What’s the best combination of distributed resources for every building in Southern California Edison’s 5.2 million customer service territory -- and what’s it worth to each customer?
NRG Energy says its new SpaceTag platform can provide the answer to these questions across a changing portfolio of properties and technologies, down to the individual building address. Now it’s putting the secretive data analytics engine to its first test -- gathering 60 megawatts of flexible clean energy capacity for key parts of SCE’s Orange County and Los Angeles power grid.
On Thursday, NRG officially began seeking out commercial and industrial customers interested in taking part in this massive behind-the-meter grid flexibility procurement. The Princeton, N.J.-based energy giant is one of many companies, including Stem, Advanced Microgrid Solutions, SunPower, and AES Energy Storage, that won bids to provide capacity as part of SCE’s 2014 distributed energy procurement, with delivery set for the end of the decade.
NRG had already laid out its three main technology offerings to meet its SCE commitments, making Thursday’s list unsurprising. First, it’s working with startup Ice Energy to install up to 25 megawatts of its ice-making, load-shifting air conditioning systems. Second, it’s teaming up with Lockheed Martin Energy to achieve up to 30 megawatts of peak load reduction through commercial HVAC, industrial refrigeration, process cooling, compressors and lighting. Third, it’s launching a demand response program aimed at 5 megawatts of commercial and industrial load.
It’s the first time NRG has publicly mentioned SpaceTag or its self-described awesome powers. “Using technology built in-house, the platform determines the compatibility of different buildings across a target region for distributed energy products by harvesting, synthesizing and analyzing data for business locations,” the company states, to “automatically identify the best solutions for each customer, making the potential customer identification and acquisition process more accurate and efficient."
NRG has kept its new analytics platform pretty hush-hush. A Google search for SpaceTag yields a few unrelated apps, Thursday’s announcement, and a trademark filing. So what’s behind this in-house data aggregation and analytics engine, and how is NRG going to be using it from now on?
We talked to Kevin Berkemeyer, NRG’s VP of innovation implementation and head of its Station A research team in San Francisco, which developed the software, to learn more. “We originally developed it to help with customer acquisition, via definition of the best resource solution for customers across the SCE territory,” he said in a Thursday interview. “It’s evolved significantly since then,” and in fact has become Station A’s main work since he took over leadership of the group about a year and a half ago.
NRG’s role as a leading generation company, one of the country’s biggest energy retailers, and a big investor in wind and solar, has given SpaceTag a lot of proprietary internal data to work with, he said. “We have significant user data from our retail operations, from our demand response operations, and from our distributed solar operations. We’re able to take data that’s publicly available, and also leverage a lot of the data we currently have (that’s proprietary) to determine optimal solutions.”
This helps differentiate NRG from the plethora of big-data analytics firms working on similar solutions to the distributed energy challenge. SpaceTag uses data about the physical attributes of the building, how it’s used, and its existing energy data, to create a profile of its energy performance -- an approach also used by startups such as Tendril, FirstFuel and Ecova's Retroficiency.
It also assesses its location in relation to the power grid, from the distribution feeder level all the way up to the grid operator level -- a task being taken on by companies such as Integral Analytics, Smarter Grid Solutions and Opus One Solutions. SpaceTag was really built to help NRG with the execution of the SCE resource program, which means it has to take the utility’s regional and distribution circuit-level capacity needs into account, said Berkemeyer.
Finally, SpaceTag uses data on the distributed energy equipment itself -- its capital cost, the associated costs of providing generation and demand-reduction attributes over time, and the optimal mix of each technology choice on the building and portfolio level. Once deployed, the same data analytics platform can help it “monitor the technical operations, and ultimately, the financial performance,” he said.
This, of course, falls into the broad description of a distributed energy resource management system, or DERMS, which features competition from startups such as Enbala, Blue Pillar and Ormat’s Viridity Energy, as well as more utility-focused products from grid giants such as Siemens, General Electric and ABB.
But NRG is already realizing value from how SpaceTag has transformed its customer acquisition process. “In the past, what we’ve done is manually combed territories for different types of customers, reached out to those customers, set up meetings, pitched the customers on what NRG can bring," said Berkemeyer. Only then has the company gotten into collecting data to determine a customer's more detailed distributed energy potential.
With SpaceTag, “We kind of reverse that process,” he said. “We’re taking a more proactive approach, from the bottom up -- assessing an entire region and all the locations in the region, and calculating the loads, and assessing the physical characteristics, and assessing the market values, the performance of different resources for those buildings." It also assesses the financials of any NRG customer.
“We’re now walking into big stores, and in the first meeting, telling them, ‘We’ve already assessed all the locations in all the areas you own and operate, and we think you should deploy this many Ice Bears, this many energy-efficiency packages, this much demand response. […] It’s a totally different approach.”
“We can also go to a utility and say the exact same thing -- "We’ve assessed your territory, and we think the most efficient deployment of capital, for customers and for you, is to deploy X megawatts of demand response and Y megawatts of batteries,” said Berkemeyer.
NRG has already mapped 24 different utility territories outside of SCE, “and we’re expanding that on a regular basis, and starting to engage more with utilities, to share more specifically how distributed energy resources could be most efficiently deployed,” he explained.