YILDIZ TECHNICAL UNIVERSITY

FACULTY OF ELECRICAL AND ELECTRONICS ENGINEERING

DEPARTMENT OF ELECTRICAL ENGINEERING

SMART HOME AND ENERGY

MANAGEMENT

TERM PROJECT
Saving money by shifting the load

Prepared By
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Teaching Assistant
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İSTANBUL, 2017
 HOME ENERGY MANAGEMENT SYSTEMS

With the arrival of smart grid era and the advent of advanced communication and information
infrastructures, bidirectional communication, advanced metering infrastructure, energy
storage systems and home area networks would revolutionize the patterns of electricity usage
and energy conservation at the consumption premises. Coupled with the emergence of
vehicle-to-grid technologies and massive distributed renewable energy, there is a profound
transition for the energy management pattern from the conventional centralized
infrastructure towards the autonomous responsive demand and cyber-physical energy
systems with renewable and stored energy sources. Under the sustainable smart grid
paradigm, the smart house with its home energy management system (HEMS) plays an
important role to improve the efficiency, economics, reliability, and energy conservation for
distribution systems.
The increasing demand for electricity and the
emergence of smart grids have presented new
opportunities for home energy management
systems (HEMS) in demand response markets.
HEMS are demand response tools that shift and
curtail demand to improve the energy
consumption and production profile of a
dwelling on behalf of a consumer. HEMS usually
create optimal consumption and production
schedules by considering multiple objectives
such as energy costs, environmental concerns,
load profiles, and consumer comfort.
Home energy management systems also incorporate Smart Meters, which are the newest
kind of gas and electricity meters. These devices regularly collect information about how
much gas and electricity you are using, thereby eliminating the need for gas and electricity
meter readings.

ROUTES TO ENERGY SAVINGS

Programs to reduce energy costs have greatly evolved from those of the 1970s that stressed
turning loads off and setting back thermostats. While it is still important to limit equipment
and system operation to only those times when they are needed, and to see that space
temperatures are matched to the needs of the occupants, today’s energy cost control
programs must do much more if they are to be successful.
There are two primary forces driving the change in energy cost control programs today: new
technology and the way in which facilities are charged for energy. New technologies have
greatly increased the operating efficiencies of today’s building systems, in some cases cutting
energy requirements by as much as 50 percent from those that were available during the
1970s.
Equally important is the way in which facilities are charged for energy. The steadily increasing
demand for energy has created a number of problems for the energy industry. Today, the
biggest concern is over electricity generation capacity. Simply stated, demand for electricity
has risen faster than utilities have been able to add generation capacity. These capacity
concerns, combined with the deregulation of the electricity industry, have resulted in
increased emphasis on demand charges for users.

But even if utilities were able to rapidly

bring new generation plants online, this
would not solve all of the problems.
While generation capacity is the big
concern today, in the near future it will
be the ability of the transmission and
distribution infrastructure to get the
power where it is needed. Therefore,
energy cost control programs must
address the demand portion as well as
the use portion of the electrical bill.

These concerns are not limited to electricity. The demand for natural gas in recent years has
outstripped both new gas wells and gas production. With many new electricity generation
plants burning natural gas instead of oil or coal, natural gas has the potential of becoming the
energy concern of the near future.
The most common strategies in use today to help control energy costs include improving the
operating efficiencies of building systems, shifting electrical loads from peak rate times,
reducing or shaving peak electrical loads, switching to alternative fuels, and most recently,
demand-response metering. By using these techniques to develop their facility’s energy cost
control program, facility executives can make a significant reduction in their facility’s energy
costs.

LOAD SHIFTING

Load shifting is a program designed to move large electrical loads from high cost, on-peak
periods to lower cost, off-peak periods. To benefit from load shifting, facilities must be on a
rate schedule that is based on time-of-day rates with separate demand charges. The greater
the differential between on-peak and off-peak rates, the greater the potential savings.
The most widely used technology for load shifting today is thermal energy storage. With
thermal energy storage, building chillers are operated during off-peak periods to generate
brine or ice, which is stored in a central tank system. During on-peak hours, chilled water is
circulated from the storage system and used to fully supply the building air conditioning
system or to supplement chilled water generated by a smaller chiller.
Because the cost of the electricity used to generate chilled water during off-peak periods is
one-fourth or less than its cost during on-peak periods, the savings in energy costs can be
significant. And with the building’s chillers offline or operating at reduced capacity when the
peak demand is set for the billing period, additional savings will be achieved in demand
charges by using thermal energy storage.
Load shifting is best applied in
applications where the occupancy of
the building varies with the time of
day, where cooling loads account for at
least 30 percent of the total electrical
load, and where the ratio between on-
peak and off-peak electricity rates is at
least 4-to-1.

PEAK SHAVING
Reducing energy use at peak times is called peak shaving or peak clipping. Peak shaving can
realise a range of benefits when it coincides with peak demand, and therefore peak prices, in
the wholesale market.
Peak shaving, as illustrated in the figure
below, can be achieved by shedding
load or by using onsite standby
generation facilities during peak times.
When reducing usage at peak times, it
can enable you to stay within your
contract’s maximum demand and can
optimise network and retail tariff costs.

Peak shaving is most appropriate when

 total load on a site is approaching the agreed maximum demand, enabling you to
avoid penalty charges; or
 the load on the distribution network is approaching its maximum.
When load on the distribution network is approaching its maximum, end users can enter into
an arrangement with the distribution network service provider to ease congestion on the
system and enhance network reliability. These types of arrangements should be discussed
with your retailer however to ensure changes in your demand profile do not impact adversely
on their energy supply arrangements and result in you paying higher energy prices because
your load appears to be more volatile.
 ELECTRICITY RATES OR TARIFF
Today’s interconnected power systems supply a number of consumers. With such a big
organization, management, economy and control come into account automatically. The
supply companies (usually in the public sector) have to sell their electricity at such a rate that
it covers the costs of generation, transmission, distribution, the salaries of the employees,
the interest and depreciation and the profit targeted by the company. This rate at which
electrical energy is sold to the consumers is termed as ‘tariff.’

The cost of generation of electricity will depend

upon various factors such as Connected Load,
Maximum Demand, Load factor, Demand Factor,
Diversity Factor, Plant Capacity Factor and Use
Factor. These, in turn, will depend upon the type
of load and load conditions. Hence, the tariff is
different for different type of loads (and hence
differentconsumers).

Therefore, while fixing the tariff, we have to consider various consumers (industrial, domestic,
commercial, etc.) and their requirements. Due to this, the whole process becomes
complicated.

Factors Involved In Deciding An Electricity Tariff

 The tariff should be such that the total cost of generation, transmission, and
distribution is recovered.
 It should earn a reasonable profit.
 It must be fair and at a reasonable to the consumers.
 It should be simple and easy to apply.
 It should be attractive than a competitor.
Keeping in mind the above factors, various types of tariff have been designed. The most
commonly used are given below.

Various Types Of Electricity Tariff

1. Simple Tariff
In this type of tariff, a fixed rate is applied for each unit of the
energy consumed. It is also known as a uniform tariff. The rate per
unit of energy does not depend upon the quantity of energy
used by a consumer. The price per unit (1 kWh) of energy is
constant. This energy consumed by the consumer is recorded by
the energy meters.
Graphically, it can be represented as follows:
Advantages:
 Simplest method
 Easily understandable and easy to apply
 Each consumer has to pay according to his utilization

Disadvantages
 There is no discrimination according to the different types of consumers.
 The cost per unit is high.
 There are no incentives (an attractive feature that makes the consumers use more
electricity.)
If a consumer does not consume any energy in a particular month, the supplier cannot charge
any money even though the connection provided to the consumer has its own costs.

Application
Generally applied to tube wells used for irrigation purposes.

2. Flat Rate Tariff

In this tariff, different types of consumers are charged at different
rates of cost per unit (1kWh) of electrical energy consumed. Different
consumers are grouped under different categories. Then, each
category is charged money at a fixed rate similar to Simple Tariff. The
different rates are decided according to the consumers, their loads
and load factors.
Graphically, it can be represented as follows:

Advantages
 More fair to different consumers.
 Simple calculations.

Disadvantages
 A particular consumer is charged at a particular rate. But there are no incentives for
the consumer.
 Since different rates are decided according to different loads, separate meters need to
be installed for different loads such as light loads, power loads, etc. This makes the
whole arrangement complicated and expensive.
 All the consumers in a particular “category” are charged at the same rates. However,
it is fairer if the consumers that utilize more energy be charged at lower fixed rates.
 3. Block Rate Tariff
In this tariff, the first block of the energy consumed
(consisting of a fixed number of units) is charged at a given
rate and the succeeding blocks of energy (each with a
predetermined number of units) are charged at
progressively reduced rates. The rate per unit in each block
is fixed.
For example, the first 50 units (1st block) may be charged
at 3 rupees per unit; the next 30 units (2nd block) at 2.50
rupees per unit and the next 30 units (3rd block) at 2
rupees per unit.
Graphically, it can be represented as follows:

Advantages
 Only 1 energy meter is required.
 Incentives are provided for the consumers due to reduced rates. Hence consumers use more
energy. This improves load factor and reduces cost of generation.

Disadvantages
 If a consumer does not consume any energy in a particular month, the supplier does
not charge any money even though the connection provided to the consumer has its
own costs.

Application
 Generally applied to residential and small commercial consumers.

4. Two Part Tariff

In this tariff scheme, the total costs charged to the consumers consist of two components: fixed
charges and running charges. It can be expressed as:

Total Cost = [A (kW) + B (kWh)] Rs.

Where, A = charge per kW of max demand (i.e. A is a constant which when multiplied with max
demand (kW) gives the total fixed costs.)
B = charge per kWh of energy consumed (i.e. B is a constant which when multiplied with units
consumed (kWh), gives total running charges.)

The fixed charges will depend upon maximum demand of the consumer and the running charge will
depend upon the energy (units) consumed. The fixed charges are due to the interest and depreciation
on the capital cost of building and equipment, taxes and a part of operating cost which is independent
of energy generated. On the other hand, the running charges are due to the operating cost which
varies with variation in generated (or supplied) energy.

Advantages
 If a consumer does not consume any energy in a particular month, the supplier will get
the return equal to the fixed charges.
Disadvantages
 Even if a consumer does not use any electricity, he has to pay the fixed charges
regularly.
 The maximum demand of the consumer is not determined. Hence, there is error of
assessment of max demand and hence conflict between the supplier and the
consumer.

Application
 Generally applied to industrial consumers with appreciable max demand.

5. Maximum Demand Tariff

In this tariff, the energy consumed is charged on the basis of maximum demand. The units
(energy) consumed by him is called maximum demand. The max demand is calculated by a
maximum demand meter. This removes any conflict between the supplier and the consumer
as it were the two part tariff. It is similar to two-part tariff.

Application
 Generally applied to large industrial consumers.

6. Power Factor Tariff

In this tariff scheme, the power factor of the consumer’s load is also considered. We know
that power factor is an important parameter in power system. For optimal operation, the pf
must be high. Low pf will cause more losses and imbalance on the system. Hence the
consumers which have low pf loads will be charged more. It can be further divided into the
following types:

(I) KVA Maximum Demand Tariff

In this type of tariff, the fixed charges are made on the basis of maximum demand in kVA
instead of KW.
We know that power factor = kW / kVA
Hence, the pf is inversely proportional to kVA demand. Hence, a consumer having low power
factor load will have to pay more fixed charges. This gives the incentive to the consumers to
operate their load at high power factor. Generally, the suppliers ask the consumers to
install power factor correction equipment.

(II) KW And KVAR Tariff

In this tariff scheme, the active power (kW) consumption and the reactive power (kVAR)
consumption is measured separately. Of course, a consumer having low power factor load
will have to pay more fixed charges.
(III) Sliding Scale Tariff
In this type of tariff scheme, an average power factor (generally 0.8 lagging) is taken as
reference. Now, if the power factor of the consumer’s loads is lower than the reference, he is
penalized accordingly. Hence, a consumer having low power factor load will have to pay more
fixed charges. Also, if the pf of the consumer’s load is greater than the reference, he is
awarded with a discount. This gives incentives to the consumers. It is usually applied to large
industrial consumers.

7. Three Part Tariff

In this scheme, the total costs are divided into 3 sections: Fixed costs, semi-fixed costs and
running costs.
Total Charges = [A + B (kW) + C (kWh)]
Where, A = fixed charges,
B = charge per kW of max demand (i.e. B is a constant which when multiplied with
max demand (kW) gives the total fixed costs.)
C = charge per kWh of energy consumed (i.e. C is a constant which when multiplied
with units consumed (kWh), gives total running charges.)

TIME OF USE PRICING

TOU pricing coupled with smart meters means you have more control over your monthly
electricity bill. By adjusting your electricity use habits slightly you can take advantage of when
the cost of electricity is less. .

When you were transitioned to TOU pricing, your

home or business was fitted with a smart meter, which
wirelessly transmits your electricity use to Hydro One
so we can bill you as accurately as possible. Most
importantly, though, smart meters help you better
understand how your daily electricity use affects your
monthly bill. .

When you know exactly how much electricity you are using and what it costs at a given hour,
you gain the power to make smarter choices for when you use electricity. You'll also be able
to save more money by reducing your electricity usage during peak hours through pricing that
rewards you for shifting your heaviest electricity usage to off-peak hours.

Because smart meters monitor your electricity use in real time, we're able to show you a
breakdown of your electricity use every month on your bill.
 LOAD SHİFTİNG APPLİCATİON USİNG MATLAB
In this part of the study, MATLAB code written to perform load shifting will be explained. The
code is written for both a winter day (15.12.2016) and a summer day (15.07.2016), and will
be mentioned here only for the winter day.

Daily Loads
The house, designed in the program, has 16 kinds of loads. Loads are
divided into 3 groups according to priority order of use:

1.Low Priority 2.Mean Priority 3. High Priority

Loads Loads
Tv Lightning
Vacuum Cleaner
Desktop Computer Freezer
Kettle
Refrigerator
Blow Dryer Microwave
Oven
Tumble Dryer Dishwasher
Combi Boiler
Iron Washing Machine
Laptop
1. Wind Power Generation
A wind turbine has been integrated into the system to reduce energy demand. Hourly wind
speed data for the relevant days are taken from www.wunderground.com. New York was
chosen as the location. Hourly forces produced against speeds were obtained from
www.futurenergy.co.uk. Hourly wind power generation is shown below.

2. Daily Remaining Demand

When wind energy is added to the system,

the remaining hourly loads are as follows.
3. Basic Algorithm
The basic operating logic of the system is shown in blocks below.
In addition, test results according to this algorithm is shown
below.
4. Benefits
Benefits are calculated using Turkey
time of use pricing (Day-Peak-Night). In
this pricing system, Day price is
0.330447 TL/kwh, Peak price is
0.499784 TL/kwh and Night price is
0.208112 TL/kwh. The calculated daily
price of electricity is as follows for the
used winter day.