En la nota Plan de Nación sin la Quimera de la Electricidad Barata, destacamos las grandes oportunidades que tendrá el país cuando reconozca, otra vez más, que lo barato sale caro. El elemento central de la nota es que:
La voluntad política de hacer el compromiso de nación para hacer realidad la economía de los servicios eléctricos nos permitirá convertirla en nuestra marca-país como lo han hecho otros países. La revista Technology Review publicó un artículo en abril del 2005, titulado "What Matters Most Depends on Where You Are" (lo que más importa depende de donde estas). Dicen que "cada país revela sus propias preocupaciones, usualmente nacen de su historia peculiar y las circunstancias actuales.” Dicen también que "hasta esas innovaciones que más directamente enfrentan necesidades urgentes regionales prueban tener aplicación para todo el planeta.” Documentan 7 países que examinaron "cuáles tecnologías emergentes son las más importantes para las sociedades y economías de las naciones, y para explicar que hace esas tecnologías características únicas de esos países.”
Mientras el sistema eléctrico de Puerto Rico es verticalmente integrado, el dominicano fue reformado con la Capitalización, la cual es mucho más costosa que el verticalmente integrado. Es más costoso porque la reforma se concentró solamente en el desarrollo de la oferta, olvidando reformar también la demanda, desaprovechando los inmensos recursos disponibles en poder de los consumidores. Ver la nota La Capitalización Ofrece la Electricidad Más Cara.
En el sistema de Puerto Rico las reservas son principalmente reservas de generación que aseguran que la falla de cualquier generador no se nota en absoluto. Por ejemplo, con un generador de 450 MW operado, ellos emplean 450 MW extras de reservas para garantizar una operación confiable. Con la reforma dominicana, la falla de una unidad de 300 MW induce casi siempre a la salida de circuitos para mantener el resto del sistema funcionando.
La realidad de ellos y la nuestra es muy distinta. En vez de una contrarreforma para aumentar la capacidad de generación y lograr que nuestro sistema funcione como el de ellos, lo que hace falta es profundizar la reforma para completar el mercado y hacerlo funcional. En vez de realizar un desarrollo a base de expansión de la oferta, lo que debemos hacer es desarrollar la competencia entre modelos de negocios que generen también reservas en el lado de la demanda. Ver la nota del 2006 Desarrollemos los Recursos del Lado de la Demanda y con Ello el País.
Cabe destacar que, en general, las reservas en el lado de la demanda son mucho más eficientes que las reservas en el lado de la oferta, porque en la oferta los generadores que suplen las reservas consumen costosos combustibles a la espera de un evento aleatorio excepcional. Sin embargo, las reservas en lado de la demanda entrar a servir solo en esos momento excepcionales.
No tenemos ninguna duda de que en el país tenemos la posibilidad de desarrollar, por ejemplo, 300 MW de reservas en el lado de la demanda para asegurar una operación confiable del sistema interconectado con mínimas reservas en el lado de la oferta. Esas mismas reservas del lado de la demanda las podremos exportar a Puerto Rico si logramos interconectar ambos sistemas, bajo la suposición de que los momentos excepcionales no ocurren de forma simultánea. Es una situación en que ambos países ganamos.
Aclaro que no estoy sugiriendo que no hace falta de capacidad de generación para abastecer la demanda. Lo que estoy diciendo es que debe completarse la reforma y dejarse al mercado esas inversiones, para separar el presupuesto de la nación del desarrollo armónico del sector eléctrico. Para más detalles sugerimos ver la nota La Proyección de la Demanda es Siempre Equivocada. Es en dicha nota donde se explica el cambio de la responsabilidad a servir a la responsabilidad a transportar electricidad confiable que es la clave para reformar nuestro sector eléctrico para poder vender reservas eléctricas a Puerto Rico.
miércoles, marzo 11, 2009
domingo, marzo 08, 2009
Innovación en los Servicios en AVATAR Club
A continuación pueden ver mi mensaje de aceptación en respuesta a la invitación que me cursó Frederic Eman-Zade Gerardino con el mensaje ¿Quiénes somos? ¿Cuáles son las finalidades de este Club?
Estimados compañeros,
Al fin me 'apunté' en el AVATAR Club SL y mi nombre es Modestico Silverfall.
Les cuento que lo que me movió a probar es el gran potencial que creo existe en el país para desarrollar la economía de los servicios, real y virtual, incluyendo decididamente el comercio global de servicios. Son al menos tres las razones:
1. La razón de ser del Grupo Millennium Hispaniola, cuyo propósito va a cambiar a lo que vislumbré en la nota Corporaciones Globales en el Plan de Nación, si aparecen personas que también lo crean posible. Entiendo que en SL las Corporaciones Globales Virtuales no tendrán las limitaciones de los intereses que impiden muchas iniciativas.
2. La innovación en los servicios es una forma de crear valor con futuro. Recientemente leí el artículo "Where innovation creates value," del consultor de McKinsey Amar Bhidé, quien dice que "Many kinds of global interactions have become more common, but not in a uniform way: international trade in manufactured goods has soared, but most services remain untraded. Of the many activities in the innovation game, only some are performed well in remote, low-cost locations; many midlevel activities, for example, are best conducted close to potential customers." Me luce que en un mundo en que el transporte físico sea mucho más costoso que el virtual, SL podría tener un lugar reservado para ser ejecutado en lugares como el país, que han dado muestras en las Zonas Francas de que podemos progresar.
3. La innovación en los servicios está en pañales puede ser un corolario del punto anterior. También supe desde hace como tres años que hay un inmenso espacio blanco para innovar en la economía de los servicios en el estudio "Seizing the white space," realizado por la firma Peer Insight para la firma Teke de Finlandia. En ese estudio, queda bien claro que el ‘producto’ de la economía de los servicios es la ‘experiencia del cliente.’
Me encantaría saber ¿a quienes de los miembros del Club les interesa este tema orientado al desarrollo del país?
Saludos,
José Antonio
Hagamos Competente Producción Local
En Hoy Digital se cita al Presidente Fernández diciendo que "... estamos compelidos en el corto y mediano plazo a la realización de un ajuste de nuestro actual modelo de desarrollo económico y social, a los fines de que apoye, impulse y promueva con mayor eficacia a los sectores productivos del país.”
Al respecto, coloqué debajo de la noticia Producción local es menos competente escrita por Carmen Carbajal, el siguiente comentario:
Al respecto, coloqué debajo de la noticia Producción local es menos competente escrita por Carmen Carbajal, el siguiente comentario:
Para hacer la producción más competente, hay que aprovechar las tecnologías de la información y las telecomunicaciones. En ese orden emergente, el costo más importante de la electricidad es el costo de la interrupción y por eso los propios productores deben generar electricidad, parecido a las minicomputadoras. Si lo pensamos bien, es lo que ha ocurrido en el país solo les falta poder vender sus excedentes. En Estados Unidos los consumidores gastan 50 centavos de dólar adicionales a cada dólar en la factura para cubrirse de las fallas del servicio mayormente en la distribución de electricidad, que hace que las grandes centrales alejadas de los centros de consumos dejen de ser competitivas. A la fecha solo don Pepín Corripio del Comité Presidencial ha respondido al mensaje "RD Debería Ser Líder de la Economía de los Servicios Eléctricos," el que puede leer pulsando la dirección de Internet incorporada en en el título del mensaje.
viernes, marzo 06, 2009
Esperanzada Denegada en Energía
Coloqué el siguiente comentario debajo de la nota Desde mi estudio / Esperanza denegada, redactada por Milton Tejeda.
Hola Milton,
Resalto que "Otro tema reiterado fue el de enfrentar adecuadamente el tema de la energía eléctrica."
Los temas consensuados en el sector eléctrico dificutlan la solución definitiva, porque las reglas de juego en la mesa de energía despreciaban el cambio necesario al order emergente.
Necesitamos una reforma impulsada por los consumidores, como aparece en la nota Propuesta Futuro Electricidad a la Cumbre de las Fuerzas Vivas y que se complementa con el artículo La Proyección de la Demanda es Siempre Equivocada.
Saludos,
José Antonio
miércoles, marzo 04, 2009
La Proyección de la Demanda es Siempre Equivocada
Por José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
Arquitecto de Sistemas de la EWPC
Semilla Orgánica del GMH
4 de marzo, 2009
© 2009. Todos los derechos reservados por José Antonio Vanderhorst Silverio
La dedicación en el libro “Spot Pricing of Electricity” dice en su segundo párrafo “Shortly before completion of this book Fred C. Schweppe, our friend, colleague and senior author died suddenly. Fred created spot pricing and proved, again, that “The forecast is always wrong!” En el modelo mental tradicional, de los que están dentro de la burbuja del orden vigente del sector eléctrico, que hace rato está por explotar, no cabe en lo más mínimo la idea de dejar de proyectar la demanda. En el orden emergente, que se puede decir que se inició en los años 80 con los trabajos de Schweppe y su equipo, no se justifica perder el tiempo, el esfuerzo, ni el dinero, en esos ejercicios.
El Editorial del GMH, publicado el 15 de septiembre, del 2006, con la nota Desarrollemos los Recursos del Lado de la Demanda y con Ello el País, es necesariamente de lectura obligatoria para comprender a cabalidad este artículo. Dicho editorial resalta las grandes oportunidades que tenemos los dominicanos al modificar el primer objetivo básico de la Ley General de Electricidad, que dicta: "Promover y garantizar la oportuna oferta de electricidad que requiera el desarrollo del país, en condiciones adecuadas de calidad, seguridad y continuidad, con el óptimo uso de recursos y la debida consideración de los aspectos ambientales."
Es evidente que se trata de un desarrollo de la oferta sin considerar el desarrollo de la demanda. El impacto de cambiar ese objetivo básico para considerar por igual el desarrollo de la demanda es transformacional, afectando radicalmente la propia ley y con ello las reglas del sector.
El Banco Mundial en su informe del año pasado “Financing Energy Efficiency: lessons from Brasil, China, India and beyond,” argumenta que existe un “vasto potencial de ahorro de energía que permanece sin realizar aunque los retornos financieros son elevados.” Comentan sobre la falta de un mecanismo eficaz de entrega de financiamiento a un número grande de pequeños proyectos esparcidos entre los consumidores. Ese mecanismo no es más que un importante nicho de modelo de negocios del desarrollo de los recursos de la demanda, que dicho sea de paso están altamente subdesarrollados en el mundo, pero no aquí en el país que simplemente están totalmente descoordinados en lo que se refiere a su potencial de eficiencia energética de corto plazo (respuesta de la demanda).
Un acontecimiento no menos importante que se desprende de lo anterior es la gran incertidumbre a futuro de la demanda, haciendo que su proyección deje mucho, pero mucho, que desear. Por eso una labor importante en el desarrollo de los recursos de la demanda, por parte de los detallistas de segunda generación (2GRs, siglas en inglés) es integrar la demanda a la planificación, operación y control del sistema interconectado. Tal integración ofrecerá grandes ahorros de coordinación por los excesos de inversión y en los costos de operación de parte de los consumidores en su autoabastecimiento.
Ahora bien y mucho más importante, la integración de la demanda al sistema interconectado, permite cambiar el proceso de contratación tradicional del sector. Para poder ejercer su derecho (que ahora no tienen porque no le compensan los apagones) a un servicio bajo las condiciones pactadas con los 2GRs, los clientes se convierten en sus principales activos para comprar electricidad en el mercado mayorista. Hagamos que los clientes sean los responsables de de proyectar sus propias demandas y asumir los riesgos de equivocarse.
Es así que en vez de adivinar, que es lo que se hace ahora hasta empleando asesores, los 2GRs desarrollarán modelos de negocios que le permitan también introducir suficiente elasticidad a su demanda en el mercado mayorista y estar en posibilidad de hacer compromisos económicos en sus proyecciones basadas en informaciones contractuales ciertas de los consumidores. Esos modelos de negocios hacen que los consumidores participen activamente en el proceso. Lo que se necesita entonces es una reforma impulsada por el consumidor, como aparece en el artículo EWPC Shared Vision: Consumer Driven Electricity System Reform.
Es así también como desaparece la necesidad del paternalismo de la Superintendencia de negociar tarifas a nombre de los consumidores que ya son mayorcitos. Es evidente que esto no ocurrirá de la noche a la mañana, por lo que el proceso de transición se podrá empezar primero con los clientes de los circuitos de 24 horas, los cuales podrán acceder a un servicio sin apagones arbitrarios.
Con reglas de juego claras y estables, como las que deben surgir de este planteamiento, la contratación de centrales de generación se queda en el sector privado y la división de los riesgos queda mejor distribuida entre los clientes, los 2GRs y los grandes generadores. Así se desacopla totalmente el presupuesto de la nación, con excepción de los subsidios focalizados que se asignen. No estoy en contra de centrales a gas, a carbón o eólicas. Estoy en contra de que el Estado asuma los riesgos de esas tecnologías, especialmente en la víspera de un nuevo protocolo post-Kioto que podría reeditar nuevas crisis IPPs.
Todo lo anterior nos lleva al concepto de la responsabilidad a servir, que subyace en el primer objetivo básico de la LGE, y que dicho sea de paso no logramos cumplir a cabalidad nunca en el país. Al consumidor hacerse responsable de sus necesidades, con la EWPC la responsabilidad pasa a ser la de transportar, que queda a cargo del servicio regulado de transporte a cambio de del peaje. Ese nuevo servicio integra la distribución física a la transmisión en las tres áreas, que hoy corresponden a las Edes, y que entonces corresponderá a las Empresas de Transporte de Electricidad (Etes). La diferencia entre la responsabilidad a servir y la responsabilidad a transportar quedará implantada en el contrato negociado entre el cliente y el 2GR que haya elegido libremente en el mercado.
Una primera propuesta de lo que podría ser el primer objetivo básico de la nueva Ley General de Electricidad es: "Promover y garantizar el oportuno transporte regulado de electricidad que requiera el mercado libre, en condiciones adecuadas de calidad, seguridad y continuidad, con el óptimo uso de recursos y la debida consideración de los aspectos ambientales." La clave de todo esto es que la proyección de la demanda es siempre equivocada.
Consultor Sistémico: Electricidad
Arquitecto de Sistemas de la EWPC
Semilla Orgánica del GMH
4 de marzo, 2009
© 2009. Todos los derechos reservados por José Antonio Vanderhorst Silverio
La dedicación en el libro “Spot Pricing of Electricity” dice en su segundo párrafo “Shortly before completion of this book Fred C. Schweppe, our friend, colleague and senior author died suddenly. Fred created spot pricing and proved, again, that “The forecast is always wrong!” En el modelo mental tradicional, de los que están dentro de la burbuja del orden vigente del sector eléctrico, que hace rato está por explotar, no cabe en lo más mínimo la idea de dejar de proyectar la demanda. En el orden emergente, que se puede decir que se inició en los años 80 con los trabajos de Schweppe y su equipo, no se justifica perder el tiempo, el esfuerzo, ni el dinero, en esos ejercicios.
El Editorial del GMH, publicado el 15 de septiembre, del 2006, con la nota Desarrollemos los Recursos del Lado de la Demanda y con Ello el País, es necesariamente de lectura obligatoria para comprender a cabalidad este artículo. Dicho editorial resalta las grandes oportunidades que tenemos los dominicanos al modificar el primer objetivo básico de la Ley General de Electricidad, que dicta: "Promover y garantizar la oportuna oferta de electricidad que requiera el desarrollo del país, en condiciones adecuadas de calidad, seguridad y continuidad, con el óptimo uso de recursos y la debida consideración de los aspectos ambientales."
Es evidente que se trata de un desarrollo de la oferta sin considerar el desarrollo de la demanda. El impacto de cambiar ese objetivo básico para considerar por igual el desarrollo de la demanda es transformacional, afectando radicalmente la propia ley y con ello las reglas del sector.
El Banco Mundial en su informe del año pasado “Financing Energy Efficiency: lessons from Brasil, China, India and beyond,” argumenta que existe un “vasto potencial de ahorro de energía que permanece sin realizar aunque los retornos financieros son elevados.” Comentan sobre la falta de un mecanismo eficaz de entrega de financiamiento a un número grande de pequeños proyectos esparcidos entre los consumidores. Ese mecanismo no es más que un importante nicho de modelo de negocios del desarrollo de los recursos de la demanda, que dicho sea de paso están altamente subdesarrollados en el mundo, pero no aquí en el país que simplemente están totalmente descoordinados en lo que se refiere a su potencial de eficiencia energética de corto plazo (respuesta de la demanda).
Un acontecimiento no menos importante que se desprende de lo anterior es la gran incertidumbre a futuro de la demanda, haciendo que su proyección deje mucho, pero mucho, que desear. Por eso una labor importante en el desarrollo de los recursos de la demanda, por parte de los detallistas de segunda generación (2GRs, siglas en inglés) es integrar la demanda a la planificación, operación y control del sistema interconectado. Tal integración ofrecerá grandes ahorros de coordinación por los excesos de inversión y en los costos de operación de parte de los consumidores en su autoabastecimiento.
Ahora bien y mucho más importante, la integración de la demanda al sistema interconectado, permite cambiar el proceso de contratación tradicional del sector. Para poder ejercer su derecho (que ahora no tienen porque no le compensan los apagones) a un servicio bajo las condiciones pactadas con los 2GRs, los clientes se convierten en sus principales activos para comprar electricidad en el mercado mayorista. Hagamos que los clientes sean los responsables de de proyectar sus propias demandas y asumir los riesgos de equivocarse.
Es así que en vez de adivinar, que es lo que se hace ahora hasta empleando asesores, los 2GRs desarrollarán modelos de negocios que le permitan también introducir suficiente elasticidad a su demanda en el mercado mayorista y estar en posibilidad de hacer compromisos económicos en sus proyecciones basadas en informaciones contractuales ciertas de los consumidores. Esos modelos de negocios hacen que los consumidores participen activamente en el proceso. Lo que se necesita entonces es una reforma impulsada por el consumidor, como aparece en el artículo EWPC Shared Vision: Consumer Driven Electricity System Reform.
Es así también como desaparece la necesidad del paternalismo de la Superintendencia de negociar tarifas a nombre de los consumidores que ya son mayorcitos. Es evidente que esto no ocurrirá de la noche a la mañana, por lo que el proceso de transición se podrá empezar primero con los clientes de los circuitos de 24 horas, los cuales podrán acceder a un servicio sin apagones arbitrarios.
Con reglas de juego claras y estables, como las que deben surgir de este planteamiento, la contratación de centrales de generación se queda en el sector privado y la división de los riesgos queda mejor distribuida entre los clientes, los 2GRs y los grandes generadores. Así se desacopla totalmente el presupuesto de la nación, con excepción de los subsidios focalizados que se asignen. No estoy en contra de centrales a gas, a carbón o eólicas. Estoy en contra de que el Estado asuma los riesgos de esas tecnologías, especialmente en la víspera de un nuevo protocolo post-Kioto que podría reeditar nuevas crisis IPPs.
Todo lo anterior nos lleva al concepto de la responsabilidad a servir, que subyace en el primer objetivo básico de la LGE, y que dicho sea de paso no logramos cumplir a cabalidad nunca en el país. Al consumidor hacerse responsable de sus necesidades, con la EWPC la responsabilidad pasa a ser la de transportar, que queda a cargo del servicio regulado de transporte a cambio de del peaje. Ese nuevo servicio integra la distribución física a la transmisión en las tres áreas, que hoy corresponden a las Edes, y que entonces corresponderá a las Empresas de Transporte de Electricidad (Etes). La diferencia entre la responsabilidad a servir y la responsabilidad a transportar quedará implantada en el contrato negociado entre el cliente y el 2GR que haya elegido libremente en el mercado.
Una primera propuesta de lo que podría ser el primer objetivo básico de la nueva Ley General de Electricidad es: "Promover y garantizar el oportuno transporte regulado de electricidad que requiera el mercado libre, en condiciones adecuadas de calidad, seguridad y continuidad, con el óptimo uso de recursos y la debida consideración de los aspectos ambientales." La clave de todo esto es que la proyección de la demanda es siempre equivocada.
martes, marzo 03, 2009
Reform, Reform, Reform
First update: Synthesis for Mr. Obama: Reform, Reform, Reform
That's how the original was titled on the EWPC Blog.
This is a synthesis of the leadership advice President Obama and President Fernández need to get our countries out of the recession stronger and sooner. Avoid by all means the uncertain business as usual that induces short term financial capital and one time green jobs; call for the certainty of a well architected reform to induce long term production capital and permanent green jobs.
To learn the details of the sysnthesis, please hit the link embedded in the tittle of the EWPC article Permanent or One Time Green Jobs?
P.D.: This was also posted as Reform, Reform, Reform, under the Technology Review article Energy Plans Revealed in Obama's Budget Outline posted by Kevin Bullis on February 26, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
That's how the original was titled on the EWPC Blog.
This is a synthesis of the leadership advice President Obama and President Fernández need to get our countries out of the recession stronger and sooner. Avoid by all means the uncertain business as usual that induces short term financial capital and one time green jobs; call for the certainty of a well architected reform to induce long term production capital and permanent green jobs.
To learn the details of the sysnthesis, please hit the link embedded in the tittle of the EWPC article Permanent or One Time Green Jobs?
P.D.: This was also posted as Reform, Reform, Reform, under the Technology Review article Energy Plans Revealed in Obama's Budget Outline posted by Kevin Bullis on February 26, 2009.
lunes, marzo 02, 2009
Permanent or One Time Green Jobs?
This is a synthesis of the leadership advice President Obama and President Fernández need to get our countries out of the recession stronger and sooner. Avoid by all means the uncertain business as usual that induces short term financial capital and one time green jobs; call for the certainty of a well architected reform to induce long term production capital and permanent green jobs.
Permanent or One Time Green Jobs?
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
EWPC Systems’ Architect
First posted in the GMH Blog, on March 2nd, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
In the EWPC post Reform on Obama Address: Health Care 9; Education 1; Energy 0, I uncovered the insight that President Obama did not called for energy reform as he did for health. That post is an update to the must read EWPC article Shared Vision: Consumer Driven Electricity System Reform (to read any of the documents, please hit the Internet link embedded in the title), whose summary states “Similar to the needed heath system reform, the Obama and the Fernández administrations can benefit all electric system stakeholders with a cost effective consumer driven reform.”
I repeat from the post that if we change ‘health’ with ‘energy’ in a key sentence of Mr. Obama address, it reads “It is time to put in place tough, new common-sense rules of the road so that our ‘energy’ market rewards drive and innovation, and punishes short-cuts and abuse.” Based on what follows, this article further supports the claim in the post that said: “… the Obama administration should expect to identify another ‘trillion dollars in savings over the next decade,’ as a result of the reform.”
To give a lucky lead, Elisa Woods wrote the very timely article Where to find a green job? She goes on to quote that “Most green jobs are not exotic. In fact, the green job of tomorrow is likely the job you have today (or had before the recession). The product you deliver may be different, but the work is much the same, according to a report issued by the Political Economy Research Institute (PERI).”
Immediately, I went to read the report, but at the top the page there were two paragraphs with a great insight that sold me a download. After reading them quickly, my attraction went rapidly towards a link that says: Download "Financing the Green Economy as an Answer to Casino Capitalism". I tried different tricks to download it, but got the message “The file is damage and could no be repaired.” However, after reading slowly the paragraphs the great insight to support the case for reform is still in them. They read as follows:
As a possible great synthesis of the article, those two paragraphs suggest a management vs. leadership decision of how to channel the stimulus funds. In one hand, management with no reform to very lousy, more of the same, old economy, ineffective one time green jobs, associated with financial capital; in the other, leadership with reform to highly effective permanent jobs of a vibrant clean-energy economy, associated with production capital. I grasp the great insight because of what I wrote back in October 2008, in the EWPC article "U.S. Presidential Elections and the Need for a Global Energy Deal:"
In synthesis, the IOUs paradigm incremental extensions that attract fossil fuels can only support business as usual financial capital (destabilizing speculation) and one time green jobs, while the EWPC paradigm shift is what will attract production capital to enable permanent green jobs. The next steps are, reform, reform, reform to an EWPC based Energy Polict Act.
Permanent or One Time Green Jobs?
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
EWPC Systems’ Architect
First posted in the GMH Blog, on March 2nd, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
In the EWPC post Reform on Obama Address: Health Care 9; Education 1; Energy 0, I uncovered the insight that President Obama did not called for energy reform as he did for health. That post is an update to the must read EWPC article Shared Vision: Consumer Driven Electricity System Reform (to read any of the documents, please hit the Internet link embedded in the title), whose summary states “Similar to the needed heath system reform, the Obama and the Fernández administrations can benefit all electric system stakeholders with a cost effective consumer driven reform.”
I repeat from the post that if we change ‘health’ with ‘energy’ in a key sentence of Mr. Obama address, it reads “It is time to put in place tough, new common-sense rules of the road so that our ‘energy’ market rewards drive and innovation, and punishes short-cuts and abuse.” Based on what follows, this article further supports the claim in the post that said: “… the Obama administration should expect to identify another ‘trillion dollars in savings over the next decade,’ as a result of the reform.”
To give a lucky lead, Elisa Woods wrote the very timely article Where to find a green job? She goes on to quote that “Most green jobs are not exotic. In fact, the green job of tomorrow is likely the job you have today (or had before the recession). The product you deliver may be different, but the work is much the same, according to a report issued by the Political Economy Research Institute (PERI).”
Immediately, I went to read the report, but at the top the page there were two paragraphs with a great insight that sold me a download. After reading them quickly, my attraction went rapidly towards a link that says: Download "Financing the Green Economy as an Answer to Casino Capitalism". I tried different tricks to download it, but got the message “The file is damage and could no be repaired.” However, after reading slowly the paragraphs the great insight to support the case for reform is still in them. They read as follows:
In his latest article for New Labor Forum, Robert Pollin grapples with two critical questions: how do we build a clean energy economy, and how do we create a financial system focused on channeling money toward productive investment as opposed to destabilizing speculation? The challenge then becomes to combine these goals in a single set of policies: how can we design financial systems that inherently support a clean-energy economy?
The reality is that there are only two possible ways to finance a clean-energy transition—public or private funding—and both sources will be needed. The key will be to ensure that private funds are channeled into green investments and away from fossil fuels. Pollin begins to explore the mechanisms that will leverage the needed private funds along with public expenditures, and guarantee that both sources of funds are channeled towards socially-desirable goals.
As a possible great synthesis of the article, those two paragraphs suggest a management vs. leadership decision of how to channel the stimulus funds. In one hand, management with no reform to very lousy, more of the same, old economy, ineffective one time green jobs, associated with financial capital; in the other, leadership with reform to highly effective permanent jobs of a vibrant clean-energy economy, associated with production capital. I grasp the great insight because of what I wrote back in October 2008, in the EWPC article "U.S. Presidential Elections and the Need for a Global Energy Deal:"
To avoid the collapse of our civilization, we need world leaders to make the commitment to develop a new system based on a paradigm shift mix of regulation and markets, under the realistic assumptions of expensive fuels, finite world limits on environmental impacts, and cheap transaction costs for end-customers that have varying energy needs. Such a paradigm is the Electricity Without Price Controls (EWPC) market architecture and design that is set to attract production capital to the power industry.
The attraction is the result of a virtuous circle of reliable service and innovative markets under stable and simple rules, adding value with the development of the resources of the demand side. Power and energy demand reductions through efficient pricing and energy efficiency may cut energy growth while increasing customer satisfaction to a new plateau that will result in attractive returns on investment.
In synthesis, the IOUs paradigm incremental extensions that attract fossil fuels can only support business as usual financial capital (destabilizing speculation) and one time green jobs, while the EWPC paradigm shift is what will attract production capital to enable permanent green jobs. The next steps are, reform, reform, reform to an EWPC based Energy Polict Act.
sábado, febrero 28, 2009
Propuesta Futuro Electricidad a la Cumbre de las Fuerzas Vivas
A todos los interesados en la sostenibilidad del sector eléctrico,
Primero que todo un cordial saludo, luego de agotada la celebración de la independencia en un mundo interdependiente. Segundo, y muy cortésmente, espero poder divulgar las respuestas que reciba a esta dupla de mensajes a ustedes que pretende volverse una visión compartida con su colaboración. Tercero, hago lo anterior porque este tema debe definitiva y necesariamente ser muy importante para la nueva fase de diálogo en la Cumbre que tratará su futuro a mediano y largo plazos.
Por eso, tanto como agente, como consultor y como consumidor, quisiera motivar su participación activa para ayudar a reorientar el sector y hacerlo realmente sostenible. Todos los inversionistas y consumidores estarán de acuerdo en que necesitamos y podemos aumentar de forma significativa y vigorosa el pastel económico del sector y eso lo haremos atrayendo consumidores sofisticados altamente rentables, como propuso antes de partir el Embajador Fannin, que necesitan un servicio de alto desempeño, al tiempo que se reintegra todo el sector.
Como bien saben todos ustedes, el futuro del sector eléctrico dominicano depende grandemente de sus reglas comerciales. Dependen por eso también de una planificación indicativa y previsora de mucha profesionalidad. En una noticia publicada en Hoy Digital, se siguen agregando propuestas y compromisos de recursos renovables, cuando la CNE informa que Instalarán 250 megas eólicos.
Por un lado, la CNE debe ser felicitada por sus grandes esfuerzos para atraer inversión en energía renovable. No obstante, por el otro lado, la CNE necesita ser también ser fuertemente cuestionada en el desempeño de la responsabilidad que le exige la Ley General de Electricidad para tratar de asegurar el máximo bienestar social del sector. Dicha responsabilidad necesaria y principalmente incluye el bienestar de los clientes finales y no solamente el cliente intermedio que es la Superintendencia de Electricidad.
Como expliqué en un anexo, que es la primera parte de esta dupla, que divulgué la semana pasada a los agentes del sector eléctrico, sin todavía recibir respuesta, la sostenibilidad del sector requiere a los agentes del mercado tomar en cuenta que su bienestar depende, indudablemente, por un efecto sistémico principalmente del bienestar de los consumidores. Ahora lo divulgo, a propósito, sin editar, con la nota RECOMENDACIONES PARA LA SOSTENIBILIDAD DEL SECTOR ELECTRICO.
Revisando el segundo informe de los consultores, que gentilmente me envió el Sr. Fermín, confirmo que ellos no se dieron cuenta de que la planificación indicativa que considera un desarrollo para sistemas mayormente hidráulicos, es totalmente inadaptada para un sistema mayormente térmico. Todo luce indicar que los que entiendo son los responsables, aunque puedo estar equivocado, de que no repitiera lo que sucedió con Mercados Energéticos, la CNE, la Superintedencia y también el OC, hiceron caso omiso al mensaje que les envié y luego publiqué con la nota Re: Información Reunión Consejo Coordinación 09.11.2005. Para no repetir la equivocación de nuevo y para actuar con la mayor brevedad para corregir la preocupante situación, noten cuidadosamente la parte final de ese mensaje, que se refiere al estudio realizado por Mercados Energéticos, donde dije y repito más de tres años después que:
Como avisé anteriormente a los agentes, este es un tema crítico para la sostenibilidad del sector eléctrico y especialmente para uno al que se pretende instalar grandes cantidades de potencia eólica, que como saben tiene tasas de salida forzada muy superiores a las de las centrales térmicas. Pues bien, el escenario de referencia que revisaron los consultores no tiene un solo MW de generación eólica y esa palabra aparece una sola vez y desligada de dicho escenario en todo en el segundo informe.
En resumen, la penetración de las centrales eólicas será mucho mayor si los planes indicativos consideran, como debe ser, la expansión con base a un sistema mayormente térmico. La penetración podrá ser muy superior si se integra la demanda a la planificación, operación y control del sistema interconectado, realizando una reforma impulsada por el consumidor, como aparece en el artículo EWPC Shared Vision: Consumer Driven Electricity System Reform. Todo luce indicar que nuestra participación en DR-CAFTA traerá una gran influencia de los Estados Unidos para modificar nuestra política ambiental.
Bajo ese nuevo escenario, creo humildemente que no solo los clientes, sino también todos los agentes del mercado, estarán siendo perjudicados por una planificación indicativa defectuosa y mucho más con una arquitectura y diseño de mercado que no refleja la nueva realidad. Todos nos merecemos una respuesta satisfactoria de las tres autoridades. Llegó la hora de empezar a enderezar el sector y generar oportunidades para exportar las ventajas que como pioneros desarrollaremos, quizás como dice la nota Corporaciones Globales en el Plan de Nación.
Un atento saludo,
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
Arquitecto de Sistemas de la EWPC.
Semilla Orgánica del GMH
Primero que todo un cordial saludo, luego de agotada la celebración de la independencia en un mundo interdependiente. Segundo, y muy cortésmente, espero poder divulgar las respuestas que reciba a esta dupla de mensajes a ustedes que pretende volverse una visión compartida con su colaboración. Tercero, hago lo anterior porque este tema debe definitiva y necesariamente ser muy importante para la nueva fase de diálogo en la Cumbre que tratará su futuro a mediano y largo plazos.
Por eso, tanto como agente, como consultor y como consumidor, quisiera motivar su participación activa para ayudar a reorientar el sector y hacerlo realmente sostenible. Todos los inversionistas y consumidores estarán de acuerdo en que necesitamos y podemos aumentar de forma significativa y vigorosa el pastel económico del sector y eso lo haremos atrayendo consumidores sofisticados altamente rentables, como propuso antes de partir el Embajador Fannin, que necesitan un servicio de alto desempeño, al tiempo que se reintegra todo el sector.
Como bien saben todos ustedes, el futuro del sector eléctrico dominicano depende grandemente de sus reglas comerciales. Dependen por eso también de una planificación indicativa y previsora de mucha profesionalidad. En una noticia publicada en Hoy Digital, se siguen agregando propuestas y compromisos de recursos renovables, cuando la CNE informa que Instalarán 250 megas eólicos.
Por un lado, la CNE debe ser felicitada por sus grandes esfuerzos para atraer inversión en energía renovable. No obstante, por el otro lado, la CNE necesita ser también ser fuertemente cuestionada en el desempeño de la responsabilidad que le exige la Ley General de Electricidad para tratar de asegurar el máximo bienestar social del sector. Dicha responsabilidad necesaria y principalmente incluye el bienestar de los clientes finales y no solamente el cliente intermedio que es la Superintendencia de Electricidad.
Como expliqué en un anexo, que es la primera parte de esta dupla, que divulgué la semana pasada a los agentes del sector eléctrico, sin todavía recibir respuesta, la sostenibilidad del sector requiere a los agentes del mercado tomar en cuenta que su bienestar depende, indudablemente, por un efecto sistémico principalmente del bienestar de los consumidores. Ahora lo divulgo, a propósito, sin editar, con la nota RECOMENDACIONES PARA LA SOSTENIBILIDAD DEL SECTOR ELECTRICO.
Revisando el segundo informe de los consultores, que gentilmente me envió el Sr. Fermín, confirmo que ellos no se dieron cuenta de que la planificación indicativa que considera un desarrollo para sistemas mayormente hidráulicos, es totalmente inadaptada para un sistema mayormente térmico. Todo luce indicar que los que entiendo son los responsables, aunque puedo estar equivocado, de que no repitiera lo que sucedió con Mercados Energéticos, la CNE, la Superintedencia y también el OC, hiceron caso omiso al mensaje que les envié y luego publiqué con la nota Re: Información Reunión Consejo Coordinación 09.11.2005. Para no repetir la equivocación de nuevo y para actuar con la mayor brevedad para corregir la preocupante situación, noten cuidadosamente la parte final de ese mensaje, que se refiere al estudio realizado por Mercados Energéticos, donde dije y repito más de tres años después que:
Sin querer menoscabar la capacidad de Mercados Energéticos para sistemas mayormente hidráulicos, encontré que ese consultor no supo evaluar el costo de desabastecimiento en el informe de las centrales a carbón y así lo expliqué en la Cámara Americana de Comercio. No he recibido a la fecha una respuesta satisfactoria en contra de mi planteamiento. Si realmente tienen experiencia manejado la parte probabilística de sistemas eléctricos mayormente térmicos, me parece que son flexibles al cumplir peticiones de los que los contratan.
Como avisé anteriormente a los agentes, este es un tema crítico para la sostenibilidad del sector eléctrico y especialmente para uno al que se pretende instalar grandes cantidades de potencia eólica, que como saben tiene tasas de salida forzada muy superiores a las de las centrales térmicas. Pues bien, el escenario de referencia que revisaron los consultores no tiene un solo MW de generación eólica y esa palabra aparece una sola vez y desligada de dicho escenario en todo en el segundo informe.
En resumen, la penetración de las centrales eólicas será mucho mayor si los planes indicativos consideran, como debe ser, la expansión con base a un sistema mayormente térmico. La penetración podrá ser muy superior si se integra la demanda a la planificación, operación y control del sistema interconectado, realizando una reforma impulsada por el consumidor, como aparece en el artículo EWPC Shared Vision: Consumer Driven Electricity System Reform. Todo luce indicar que nuestra participación en DR-CAFTA traerá una gran influencia de los Estados Unidos para modificar nuestra política ambiental.
Bajo ese nuevo escenario, creo humildemente que no solo los clientes, sino también todos los agentes del mercado, estarán siendo perjudicados por una planificación indicativa defectuosa y mucho más con una arquitectura y diseño de mercado que no refleja la nueva realidad. Todos nos merecemos una respuesta satisfactoria de las tres autoridades. Llegó la hora de empezar a enderezar el sector y generar oportunidades para exportar las ventajas que como pioneros desarrollaremos, quizás como dice la nota Corporaciones Globales en el Plan de Nación.
Un atento saludo,
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
Arquitecto de Sistemas de la EWPC.
Semilla Orgánica del GMH
RECOMENDACIONES PARA LA SOSTENIBILIDAD DEL SECTOR ELECTRICO
RECOMENDACIONES PARA LA SOSTENIBILIDAD DEL SECTOR ELECTRICO
Borrador para Discusión
A la atención de los consumidores (más adelante), las distribuidoras, los generadores diesel (las minicomputadoras del sector eléctrico) y otros que se deben sentir perjudicados económicamente por la normativa del sector.
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
23 de febrero de 2009
Prohibida su entrega a consultores externos sin mi autorización. Para uso exclusivo de la SIE, la CNE y los agentes del mercado dominicano, por el momento.
Muy a pesar de los reiterados reclamos a través del tiempo que he venido realizando, se sigue contratando consultores que desarrollan sugerencias para sistemas mayormente hidráulicos. En los sistemas mayormente térmicos, con unidades que tienen un rango amplio de tasas de salida forzadas, especialmente cuando muchas de las cuales son excesivas, se sabe desde antes de los años 80 (así trabajé en CDE) que se deben definir las reservas empleando modelos probabilísticos, en vez de determinísiticos.
Al seguir una simple lista de mérito, que no toma en cuenta las diferentes tasas de salida forzada de las unidades generadoras, no se puede lograr el nivel de seguridad estable en el SENI con solamente seguir reglas para regular la frecuencia. Al no garantizarse un nivel estable de seguridad, la operación deja de ser de mínimo costo, porque incentiva que los clientes se vean motivados a invertir en un mayor nivel de autoabastecimiento que el que resulta óptimo y que se corresponde a un nivel estable.
Tal autoabastecimiento hace que los clientes premien a sus suplidores del mercado de soluciones individuales, que compiten más fácilmente con el sector, reduciéndoles su poder adquisitivo y por ende su capacidad de pago del servicio. Este es en verdad uno de los principales elementos sistémicos que afectan adversamente la sostenibilidad del sector y cuya culpa es de la deficiencia de la propia normativa del sector.
Para realmente lograr una operación de mínimo costo, es necesario asegurar un nivel mínimo de probabilidad de pérdida de carga y las distribuidoras son las primeras que deberían realizar esos reclamos. A menos que se garantice un servicio con una probabilidad de pérdida de carga definida, los programas de 24 Horas no podrán ofrecer un nivel de servicio establecido. Así, las distribuidoras son afectadas económicamente, al comprar un servicio sin una norma que satisfaga el debido nivel de seguridad.
Al mismo tiempo, con esas normas se está afectando económicamente a las unidades más confiables. La Superintendencia deberá ser apoderada de esas injusticias tanto por los generadores afectados como por las distribuidoras, que hacen que el costo del sistema resulte muy superior al mínimo costo, afectando la sostenibilidad.
Después del escándalo de Mercados Energéticos que divulgué a lo interno y a lo externo del sector, al definir un plan de expansión que siguen cálculos deterministicos, que hacen que la industria auspicie el autoabastecimiento, tengo entendido que los consultores realizaron otro estudio para minimizar la energía no servida con modelo determinístico. Por eso solicité el informe No.2 que me mencionó el consultor de nacionalidad argentina, que trata de esa materia sin haberlo recibido todavía.
De nuevo, reitero que desde el punto de vista de la expansión de mínimo costo, esas normas perjudican grandemente a la generación de electricidad a base de motores, con la falsa noción de que las centrales grandes son las más económicas. Eso así, porque mientras más grande es una unidad, mayor es la necesidad de reserva a la que debe remunerar. Esa parece ser la razón que ha hecho que no se aplique una norma de seguridad de servicio afectando negativamente la sostenibilidad del sector, bajo la falsa idea de que mientras más grande más económico sin tomar en cuenta la fiabilidad.
Este tema cobra vital importancia con la integración de generadores eólicos y solares. Cobra también mucha importancia el apoyo que puede brindar una demanda que se desarrolle conforme a la electricidad sin control de precios, que podrá servir para ayudar a mantener el nivel de seguridad del sistema interconectado. Los detallistas de segunda generación están pensados para reemplazar las distribuidoras en sus operaciones comerciales.
Espero que este aporte de lugar a las modificaciones que se corresponden a fin de aumentar la sostenibilidad de todo el sector. No dudo que hayan otros elementos que hagan que seamos nosotros mismos los que nos perjudiquemos por falta de visión y de conocimiento.
Borrador para Discusión
A la atención de los consumidores (más adelante), las distribuidoras, los generadores diesel (las minicomputadoras del sector eléctrico) y otros que se deben sentir perjudicados económicamente por la normativa del sector.
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
23 de febrero de 2009
Prohibida su entrega a consultores externos sin mi autorización. Para uso exclusivo de la SIE, la CNE y los agentes del mercado dominicano, por el momento.
Muy a pesar de los reiterados reclamos a través del tiempo que he venido realizando, se sigue contratando consultores que desarrollan sugerencias para sistemas mayormente hidráulicos. En los sistemas mayormente térmicos, con unidades que tienen un rango amplio de tasas de salida forzadas, especialmente cuando muchas de las cuales son excesivas, se sabe desde antes de los años 80 (así trabajé en CDE) que se deben definir las reservas empleando modelos probabilísticos, en vez de determinísiticos.
Al seguir una simple lista de mérito, que no toma en cuenta las diferentes tasas de salida forzada de las unidades generadoras, no se puede lograr el nivel de seguridad estable en el SENI con solamente seguir reglas para regular la frecuencia. Al no garantizarse un nivel estable de seguridad, la operación deja de ser de mínimo costo, porque incentiva que los clientes se vean motivados a invertir en un mayor nivel de autoabastecimiento que el que resulta óptimo y que se corresponde a un nivel estable.
Tal autoabastecimiento hace que los clientes premien a sus suplidores del mercado de soluciones individuales, que compiten más fácilmente con el sector, reduciéndoles su poder adquisitivo y por ende su capacidad de pago del servicio. Este es en verdad uno de los principales elementos sistémicos que afectan adversamente la sostenibilidad del sector y cuya culpa es de la deficiencia de la propia normativa del sector.
Para realmente lograr una operación de mínimo costo, es necesario asegurar un nivel mínimo de probabilidad de pérdida de carga y las distribuidoras son las primeras que deberían realizar esos reclamos. A menos que se garantice un servicio con una probabilidad de pérdida de carga definida, los programas de 24 Horas no podrán ofrecer un nivel de servicio establecido. Así, las distribuidoras son afectadas económicamente, al comprar un servicio sin una norma que satisfaga el debido nivel de seguridad.
Al mismo tiempo, con esas normas se está afectando económicamente a las unidades más confiables. La Superintendencia deberá ser apoderada de esas injusticias tanto por los generadores afectados como por las distribuidoras, que hacen que el costo del sistema resulte muy superior al mínimo costo, afectando la sostenibilidad.
Después del escándalo de Mercados Energéticos que divulgué a lo interno y a lo externo del sector, al definir un plan de expansión que siguen cálculos deterministicos, que hacen que la industria auspicie el autoabastecimiento, tengo entendido que los consultores realizaron otro estudio para minimizar la energía no servida con modelo determinístico. Por eso solicité el informe No.2 que me mencionó el consultor de nacionalidad argentina, que trata de esa materia sin haberlo recibido todavía.
De nuevo, reitero que desde el punto de vista de la expansión de mínimo costo, esas normas perjudican grandemente a la generación de electricidad a base de motores, con la falsa noción de que las centrales grandes son las más económicas. Eso así, porque mientras más grande es una unidad, mayor es la necesidad de reserva a la que debe remunerar. Esa parece ser la razón que ha hecho que no se aplique una norma de seguridad de servicio afectando negativamente la sostenibilidad del sector, bajo la falsa idea de que mientras más grande más económico sin tomar en cuenta la fiabilidad.
Este tema cobra vital importancia con la integración de generadores eólicos y solares. Cobra también mucha importancia el apoyo que puede brindar una demanda que se desarrolle conforme a la electricidad sin control de precios, que podrá servir para ayudar a mantener el nivel de seguridad del sistema interconectado. Los detallistas de segunda generación están pensados para reemplazar las distribuidoras en sus operaciones comerciales.
Espero que este aporte de lugar a las modificaciones que se corresponden a fin de aumentar la sostenibilidad de todo el sector. No dudo que hayan otros elementos que hagan que seamos nosotros mismos los que nos perjudiquemos por falta de visión y de conocimiento.
miércoles, febrero 25, 2009
Reform on Obama Address: Health Care 9; Education 1; Energy 0.
This post responds to the M.I.T. Technology Review Blog post What the Fed Can Learn from California's Energy Policy, By Katherine Bourzac. I contend that the Fed does not want to learn anything from California energy policy, because the state developed a flawed electricity reform in order to keep an “outdated regulatory system. It is time to put in place tough, new common-sense rules of the road so that our” energy “market rewards drive and innovation, and punishes short-cuts and abuse.” In those two quotes, I only change what President Obama said in his address to the joint session of Congress, by introducing the word energy, instead of financial. There is an urgent need for a real reform.
To support the need for awareness, I searched a transcript of Mr. Obama address to add the number of times that he said the word reform on the “three areas that are absolutely critical to our economic future: energy, health care, and education.” The score was 0, 9 and 1, respectively. The reason for the zero score in energy is a BIG LIE that originated in the California electricity reform, as can be seen inside the EWPC article Shared Vision: Consumer Driven Electricity System Reform.
While the large number of green jobs created in the last 30 years could be correct, the costs to create those jobs have been a lot higher than necessary because of regulated programs inefficiencies. By including the cost effective consumer driven reform, while going “line by line through the federal budget in order to eliminate wasteful and ineffective programs,” the Obama administration should expect to identify another “trillion dollars in savings over the next decade,” as a result of the reform.
A lot of the saving will be in many of the energy efficiency programs in the budget itself without the suggested reform. To learn how to implement the reform, please consider also the EWPC article How to Increase the Leverage of Stimulus Bill to Global Green Energy.
To support the need for awareness, I searched a transcript of Mr. Obama address to add the number of times that he said the word reform on the “three areas that are absolutely critical to our economic future: energy, health care, and education.” The score was 0, 9 and 1, respectively. The reason for the zero score in energy is a BIG LIE that originated in the California electricity reform, as can be seen inside the EWPC article Shared Vision: Consumer Driven Electricity System Reform.
While the large number of green jobs created in the last 30 years could be correct, the costs to create those jobs have been a lot higher than necessary because of regulated programs inefficiencies. By including the cost effective consumer driven reform, while going “line by line through the federal budget in order to eliminate wasteful and ineffective programs,” the Obama administration should expect to identify another “trillion dollars in savings over the next decade,” as a result of the reform.
A lot of the saving will be in many of the energy efficiency programs in the budget itself without the suggested reform. To learn how to implement the reform, please consider also the EWPC article How to Increase the Leverage of Stimulus Bill to Global Green Energy.
Shared Vision: Consumer Driven Electricity System Reform
Similar to the needed heath system reform, the Obama and the Fernández administrations can benefit all electric system stakeholders with a cost effective consumer driven reform.
Shared Vision: Consumer Driven Electricity System Reform
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 25th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The objective of this post is for readers to send this message to the Presidential Committees, in the U.S. and here, in support of this shared vision of a consumer driven electricity reform.
For the background of this article, this is also part of my second response to the founder of the Funglode Campus Virtual, Mr. Jan Herder, as part of the ongoing discussion Esperando Invitación del Comité Presidencial (please hit its link to read it). To get readers interested in sending the post, I will justify the need for such reform.
Both the Obama administration and that of President Fernandez have great opportunities to benefit from a necessary and urgent cost effective reform of the electricity industry. During the Bush administration, the key disruption was the Enron scandal, which was received here by President Mejia to enable the ongoing counter reform. The reason of the disruption was not what most people were made to believe; it was something else. Even though it’s excessive greed, Enron was not the underlying cause; the cause that pushed Enron, and also enabled the very expensive Madrid Agreement in the Dominican Republic, was a flawed wholesale market driven reform.
As may be seen in the EWPC article The BIG California LIE, I show that "The BIG LIE is that retail competition is impossible in electric markets. The implementation of a competitive retail market was the center of the debate in California. Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-customers, acted very irresponsibly. EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders."
Going forward then, in the U.S. and the here in the Dominican Republic, the most important thing is to have an electricity system reform, similar to what Harvard’s professor Regina Herzlinger has been writing about the health system reform in the U.S. Dr. Herzlinger suggests that "of course you have to pay... the question is how much?," as Steve Bailey wrote one year ago in The Boston Glove article "How much is too much to pay?"
Mr Bailey added that "Herzlinger is the nation's leading advocate for consumer-driven healthcare reform - the belief that what we need is not more money in the system but consumers who have more power, more information, and more choice." Consumer-driven electricity reform, with exactly the same belief, is what should be the aim of a shared vision, which helps unleash what is explained in the article EWPC as a Timely Basic Innovation.
Shared Vision: Consumer Driven Electricity System Reform
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 25th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
The objective of this post is for readers to send this message to the Presidential Committees, in the U.S. and here, in support of this shared vision of a consumer driven electricity reform.
For the background of this article, this is also part of my second response to the founder of the Funglode Campus Virtual, Mr. Jan Herder, as part of the ongoing discussion Esperando Invitación del Comité Presidencial (please hit its link to read it). To get readers interested in sending the post, I will justify the need for such reform.
Both the Obama administration and that of President Fernandez have great opportunities to benefit from a necessary and urgent cost effective reform of the electricity industry. During the Bush administration, the key disruption was the Enron scandal, which was received here by President Mejia to enable the ongoing counter reform. The reason of the disruption was not what most people were made to believe; it was something else. Even though it’s excessive greed, Enron was not the underlying cause; the cause that pushed Enron, and also enabled the very expensive Madrid Agreement in the Dominican Republic, was a flawed wholesale market driven reform.
As may be seen in the EWPC article The BIG California LIE, I show that "The BIG LIE is that retail competition is impossible in electric markets. The implementation of a competitive retail market was the center of the debate in California. Instead of cooperating to implement it, the three big California utilities, that didn't care about the end-customers, acted very irresponsibly. EWPC is the paradigm shift to show that retail competition is not only possible, but absolutely necessary to turn the electricity industry into a vibrant value added business for all stakeholders."
Going forward then, in the U.S. and the here in the Dominican Republic, the most important thing is to have an electricity system reform, similar to what Harvard’s professor Regina Herzlinger has been writing about the health system reform in the U.S. Dr. Herzlinger suggests that "of course you have to pay... the question is how much?," as Steve Bailey wrote one year ago in The Boston Glove article "How much is too much to pay?"
Mr Bailey added that "Herzlinger is the nation's leading advocate for consumer-driven healthcare reform - the belief that what we need is not more money in the system but consumers who have more power, more information, and more choice." Consumer-driven electricity reform, with exactly the same belief, is what should be the aim of a shared vision, which helps unleash what is explained in the article EWPC as a Timely Basic Innovation.
domingo, febrero 22, 2009
EWPC as a Timely Basic Innovation
As time goes by, an increasing number of people will agree that the EWPC creation is in fact a fundamental organizational innovation to restructure the global power industry to help enable a sustainable world.
EWPC as a Timely Basic Innovation
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 22nd, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
EWPC as a Timely Basic Innovation
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 22nd, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Xxxxxxxxxxxxxxxxxxxxxxxxx There is nothing more powerful than an idea
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx whose time has come.
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Victor Hugo
Up to know, I have been writing about electricity without price control (EWPC) market architecture and design as a paradigm. It is a new paradigm for the power industry that has a very different center of attraction than that of the investor owned utilities (IOUs) paradigm, that served us so well in the Industrial Age, but that for all practical purposes its pervasive influence needs to end. From now on, I suggest that the EWPC creation will be recognized also as a basic innovation by an increasing number of people.
In chapter 5, “Never Doubt What One Person and a Small Group of Co-Conspirators Can Do,” of its book “The Necessary Revolution,” Peter Senge recalls:
By reading closely to what Senge recalls as basic innovations, I recognized that EWPC is one of them. As any insight, which is the result of lateral thinking, the idea of EWPC as a basic innovation is now very easily explained. By becoming a systemic consultant, I have been emulating Senge´s suggestion of the Leader’s New Work [see chapter 15 of the revised edition of The Fifth Discipline] while EWPC emerged.
Quoting the first edition of The Fifth Discipline, the case of commercial air travel was mentioned in my 2005 rebuttal article An Alternative Business Case for Demand Response, where I wrote that:
As can be inferred from that rebuttal article, EWPC is an extension of the seminal work of the late M.I.T. professor Fred Charles Schweppe and his colleagues, which was recently recognized, once again, in the EWPC article I will Tell You Who is Going to Get the Power, from which the following August 2005 quote is taken:
Going over the collection of more than 140 EWPC articles, that I claim each is a “holographic image from a different perspective of the whole EWPC market architecture and design paradigm shift,” it is easy to convince readers that EWPC has all the characteristics of a basic innovation. Most of those characteristics are specified in the single EWPC article The Sixth Disruptive Technology, whose summary states:
The characteristics of “shifts in personal and organizational thinking,” mentioned above, are summarized by EWPC being a paradigm shift to transform the power industry away from the IOUs paradigm. An explanation of the paradigm shift can be found in the recent EWPC article To Dr. Chu: Align Stimulus to Clean Energy Reform, from which I quote:
One of the most important discoveries of EWPC is the need for applying the system architecture ultraquality imperative heuristic to the power system, leading to the policy of Reliability First, Economy Second (R1E2). The key deregulation flaw was in fact the destruction of the system by not recognizing the high importance of preserving a key element of the institutional memory of the IOUs paradigm, by shifting to an unstable E1R2 policy. As a representative to the policy is the EWPC article Free Market and Central Planning, Under R1E2, which is summarized as [I know it is not very humble, but that is how it emerged]:
All along, I have spent a lot of patient time to try to develop EWPC first, and foremost, in my country, the Dominican Republic, which has a definite advantage to recoup very large coordination savings which are the result of an uncoordinated and vibrant Everyone for Himself (EFH) wide open market. That EFH market, as large as one half of the formal market, is also available in the U.S., as described in EWPC article Handling Smart Grid & Intelligent Utility High Complexity.
For that, and many other reasons, I have shown that DOE and non risk averse IOUs have all the justification they need to get involved in the development of EWPC. In fact, EWPC will be much less expensive that business as usual, as explained in the EWPC article How to Increase the Leverage of Stimulus Bill to Global Green Energy.
Recently, I was invited the Caribbean Regional Negotiating Machinery (CRNM) to participate in an Energy Services Consultation, where I proposed an offensive trade and investment service strategy, which is intended to capitalize the mentioned advantages of the Dominican Republic. Later on, I stressed the proposal by sending a message that included as an example the EWPC article Propelling the Power Industry to a Superior Solution Path. I promised then to try to develop the strategy by forming a virtuous team of Caribbean nationals.
I strongly and humbly believe that EWPC is in fact a fundamental organizational innovation to restructure the global power industry to help enable a sustainable world. Explaining the case of the U.S. Green Building Council (USGBC), in The Necessary Revolution, Senge quotes Jim Hartzfeld of Interface, who became its president saying “In retrospect, it’s crazy to think that a small group of people could think about transforming a whole industry that represents 8 percent of the U.S. GDP, but that’s exactly what we had in mind.” Similar to case of the USGBC which mutually reinforces EWPC, with all due respect, that’s exactly what I have had in mind all along.
In any case, as the EWPC system architect, I like to be able to interview, select, and work together in partnership, with a small group of global co-conspirators consultants’ insiders, that represent the larger whole system to form a virtuous EWPC team, to get sufficient resources for the start up phase, and to develop the needed theory and practice of profound knowledge. If you think you are such a remarkable consultant, and want to “cross the threshold,” as Joseph Jaworski defines it in his book Synchronicity, to the EWPC paradigm, please write to me at javs@ieee.org, by sending a brief statement of what you are able to do to help complete the documentation to transform the power industry.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx whose time has come.
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Victor Hugo
Up to know, I have been writing about electricity without price control (EWPC) market architecture and design as a paradigm. It is a new paradigm for the power industry that has a very different center of attraction than that of the investor owned utilities (IOUs) paradigm, that served us so well in the Industrial Age, but that for all practical purposes its pervasive influence needs to end. From now on, I suggest that the EWPC creation will be recognized also as a basic innovation by an increasing number of people.
In chapter 5, “Never Doubt What One Person and a Small Group of Co-Conspirators Can Do,” of its book “The Necessary Revolution,” Peter Senge recalls:
… a timeless story of what historians call ‘basic innovations,’ fundamentals changes in technology and organization that create new industries, transform existing ones, and, over time reshape societies. Basic innovations – such as the emergence of electrification, the automobile, commercial air travel, digital computing, and most recently the Internet – involve not just a single new technology but a collection of new inventions, practices, distribution networks, businesses and business models, and shifts in personal and organizational thinking.
By reading closely to what Senge recalls as basic innovations, I recognized that EWPC is one of them. As any insight, which is the result of lateral thinking, the idea of EWPC as a basic innovation is now very easily explained. By becoming a systemic consultant, I have been emulating Senge´s suggestion of the Leader’s New Work [see chapter 15 of the revised edition of The Fifth Discipline] while EWPC emerged.
Quoting the first edition of The Fifth Discipline, the case of commercial air travel was mentioned in my 2005 rebuttal article An Alternative Business Case for Demand Response, where I wrote that:
The DC-10 [it was actually the DC-3] initiated commercial air travel at the time of the Great Depression, it happened when all required technologies became available, and were tightly integrated…. In that same sense, electric power systems will also “fly” reliably (a very low frequency and duration of crashes) and experience commercial quality electricity under complete deregulation [that later emerged as the EWPC reregulation], when Demand Response gets tightly integrated with AMI and other existing technologies under a proper market design. DR will enable the system to operate within the Normal Operating State, returning back as soon as possible from the Alert and Emergency States with Demand Response actions. This is poised to be the End-State of the electricity industry for the long run [I replaced ‘the long run’ later on to ‘quite some time.’]
As can be inferred from that rebuttal article, EWPC is an extension of the seminal work of the late M.I.T. professor Fred Charles Schweppe and his colleagues, which was recently recognized, once again, in the EWPC article I will Tell You Who is Going to Get the Power, from which the following August 2005 quote is taken:
Contrary to the belief that IEEE Spectrum was wrong, Professor Fred C. Schweppe, of MIT, brilliantly predicted a mayor tech breakthrough in electric power, when he said [in 1978] that “There is a good chance that by the year 2000 the term blackout (societal definition) will be considered to be a term out of the Dark Ages." The chance has been there all along, except that a powerful lobby has prevented it, by keeping the natural monopoly of distribution related or integrated with non monopoly retail marketing.
Going over the collection of more than 140 EWPC articles, that I claim each is a “holographic image from a different perspective of the whole EWPC market architecture and design paradigm shift,” it is easy to convince readers that EWPC has all the characteristics of a basic innovation. Most of those characteristics are specified in the single EWPC article The Sixth Disruptive Technology, whose summary states:
A set of 6 disruptive technologies can be identified “To do a better job of managing our dwindling energy resources…” AMI and the Smart Grid are the fourth and fifth disruptive technologies to allow a breakthrough paradigm of the power industry for the 21st Century, as the required technologies become available, and will be tightly integrated by business model innovations - the sixth disruptive technology - developed by 2GRs into a systemic superior solution. The first three disruptive technologies are demand response, distributed generation and storage, and energy efficiency.
The characteristics of “shifts in personal and organizational thinking,” mentioned above, are summarized by EWPC being a paradigm shift to transform the power industry away from the IOUs paradigm. An explanation of the paradigm shift can be found in the recent EWPC article To Dr. Chu: Align Stimulus to Clean Energy Reform, from which I quote:
It is well known that the IOUs paradigm has a strong inertia against energy efficiency… Its strong magnetic attraction perverse incentive cannot be sufficiently mitigated with artificial decoupling of profits and sales … Something else is needed to apply an urgent policy …What is needed … is a paradigm shift to a new center of magnetic attraction with a very large inertia, where natural decoupling of profits and sales exists. That is the survival mechanism of competing retailers to get sales from customers that add value to them. The new paradigm replaces the magnetic attraction of the obsolete business model of having IOUs win cases to the regulator with the new source of attraction of competitive business models to be developed by Second Generation Retailers (2GRs) … aiming to the development of federal business model innovations.
One of the most important discoveries of EWPC is the need for applying the system architecture ultraquality imperative heuristic to the power system, leading to the policy of Reliability First, Economy Second (R1E2). The key deregulation flaw was in fact the destruction of the system by not recognizing the high importance of preserving a key element of the institutional memory of the IOUs paradigm, by shifting to an unstable E1R2 policy. As a representative to the policy is the EWPC article Free Market and Central Planning, Under R1E2, which is summarized as [I know it is not very humble, but that is how it emerged]:
This is my synthesis of the EWPC paradigm shift that maximizes social welfare. Although it is a non-trivial subject, it seems that many intelligent and important readers of earlier posts may just understand it. Maybe, I could get a prize for it, as it goes against the politically correct and the popular consensus of our time.
All along, I have spent a lot of patient time to try to develop EWPC first, and foremost, in my country, the Dominican Republic, which has a definite advantage to recoup very large coordination savings which are the result of an uncoordinated and vibrant Everyone for Himself (EFH) wide open market. That EFH market, as large as one half of the formal market, is also available in the U.S., as described in EWPC article Handling Smart Grid & Intelligent Utility High Complexity.
For that, and many other reasons, I have shown that DOE and non risk averse IOUs have all the justification they need to get involved in the development of EWPC. In fact, EWPC will be much less expensive that business as usual, as explained in the EWPC article How to Increase the Leverage of Stimulus Bill to Global Green Energy.
Recently, I was invited the Caribbean Regional Negotiating Machinery (CRNM) to participate in an Energy Services Consultation, where I proposed an offensive trade and investment service strategy, which is intended to capitalize the mentioned advantages of the Dominican Republic. Later on, I stressed the proposal by sending a message that included as an example the EWPC article Propelling the Power Industry to a Superior Solution Path. I promised then to try to develop the strategy by forming a virtuous team of Caribbean nationals.
I strongly and humbly believe that EWPC is in fact a fundamental organizational innovation to restructure the global power industry to help enable a sustainable world. Explaining the case of the U.S. Green Building Council (USGBC), in The Necessary Revolution, Senge quotes Jim Hartzfeld of Interface, who became its president saying “In retrospect, it’s crazy to think that a small group of people could think about transforming a whole industry that represents 8 percent of the U.S. GDP, but that’s exactly what we had in mind.” Similar to case of the USGBC which mutually reinforces EWPC, with all due respect, that’s exactly what I have had in mind all along.
In any case, as the EWPC system architect, I like to be able to interview, select, and work together in partnership, with a small group of global co-conspirators consultants’ insiders, that represent the larger whole system to form a virtuous EWPC team, to get sufficient resources for the start up phase, and to develop the needed theory and practice of profound knowledge. If you think you are such a remarkable consultant, and want to “cross the threshold,” as Joseph Jaworski defines it in his book Synchronicity, to the EWPC paradigm, please write to me at javs@ieee.org, by sending a brief statement of what you are able to do to help complete the documentation to transform the power industry.
sábado, febrero 21, 2009
Handling Smart Grid & Intelligent Utility High Complexity
Two recent articles deal on how to tackle the high complexity of Smart Grid & Intelligent Utility visionary iniatives. This article shows how to divide and conquer.
Handling Smart Grid & Intelligent Utility High Complexity
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 21st, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Mr. Roger Gray is the author of the Jan/Feb 2009 edition of Intelligent Utility article Get Involved - The "Who" of Intelligent Initiatives - How you organize to implement your intelligent utility vision is more important than the smart grid system you pick. In fact, neither the intelligent utility nor the smart grid are single systems. Rather, intelligent utility is a vision implemented by strategy, business process, and system change.
This is my suggestion on how to start to handle the complexity of intelliget initiative:
Mr. Roger Gray
There are two key elements on your article that I selected:
1) "Involvement in the intelligent utility effort transcends the utility and goes beyond its walls."
2) "As utilities start to organize to plan and implement intelligent utility and smart grid projects, we need to recognize what is a fundamental weakness in our industry: marketing and the customer relationship."
What those two elements are begging for is an emergent whole system that goes beyond the walls of the utility, in which customers are able to make real choices. As you will see that is only possible by separating the grid from the enterprise, as explained next.
This is what I wrote under the article Hype Aside, Building the Smart Grid will require Both 'Top Down' and Bottom Up Approach," by Tim Wolf , Vice President, Plexus Research, an R. W. Beck Company:
Mr. Tim Wolf,
It seems to me that your article is a perfect contribution to continue with incremental extensions of the investor owned utilities (IOUs) paradigm. I gather that by reading "... developing a sound Smart Grid plan that transcends organizational boundaries within the utility and establishes at least a 5- to 10-year time horizon." After the Theory of the U was developed, we know how to tackle problems with very high complexity, you are in a fact restricting yourself to learn from the past.
As system architects do, why no transcend the boundaries of the utility itself to learn from the whole power system, that is trying to emerge since the 80s? The emergent future is a paradigm shift, which is discontinuous from the present. As mentioned in the EWPC article Propelling the Power Industry to a Superior Solution Path, Mr. Steve Pullins (and much earlier myself) most of the value creation is occurring after the meter, in a vibrant open market where many disruptive technologies are available.
Those disruptive technologies, however, are generating a very costly everyone for himself (EFH) market, that I started to mentioned after the IEEE Power & Energy article a Dominican strategy, as Dominican “customers have invested large amounts of money to reduce shortage costs individually.” As we look carefully, the same thing has been happening in the U.S., as can be seen in the post U.S Power Service is Regulated as a 3rd World Country, that says:
That is how large was already the vibrant U.S. EFH market when that quote was made. It is easy to know that as digital penetration increases, that competitive market will keep growing, while leaving behind an obsolete IOUs market. That is why Mr. Pullins findings lead to the awareness needed for IOUs investors to adopt as soon as possible the EWPC paradigm in their favor.
Sufices to say that the EWPC paradigm separates the whole emerging system into two subsystems that mutually reinforce each other. One open wholesale and retail market system and one regulated transportation (T&D) only system that should evolve into the smart grid. That is the vision.
Besides the above documents, among the more that 130 EWPC articles, I suggest to start reading this two:
1) The Sixth Disruptive Technology
2) Leadership Answers What to do First
Regards,
José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
EWPC System Architect
Handling Smart Grid & Intelligent Utility High Complexity
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 21st, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Mr. Roger Gray is the author of the Jan/Feb 2009 edition of Intelligent Utility article Get Involved - The "Who" of Intelligent Initiatives - How you organize to implement your intelligent utility vision is more important than the smart grid system you pick. In fact, neither the intelligent utility nor the smart grid are single systems. Rather, intelligent utility is a vision implemented by strategy, business process, and system change.
This is my suggestion on how to start to handle the complexity of intelliget initiative:
Mr. Roger Gray
There are two key elements on your article that I selected:
1) "Involvement in the intelligent utility effort transcends the utility and goes beyond its walls."
2) "As utilities start to organize to plan and implement intelligent utility and smart grid projects, we need to recognize what is a fundamental weakness in our industry: marketing and the customer relationship."
What those two elements are begging for is an emergent whole system that goes beyond the walls of the utility, in which customers are able to make real choices. As you will see that is only possible by separating the grid from the enterprise, as explained next.
This is what I wrote under the article Hype Aside, Building the Smart Grid will require Both 'Top Down' and Bottom Up Approach," by Tim Wolf , Vice President, Plexus Research, an R. W. Beck Company:
Mr. Tim Wolf,
It seems to me that your article is a perfect contribution to continue with incremental extensions of the investor owned utilities (IOUs) paradigm. I gather that by reading "... developing a sound Smart Grid plan that transcends organizational boundaries within the utility and establishes at least a 5- to 10-year time horizon." After the Theory of the U was developed, we know how to tackle problems with very high complexity, you are in a fact restricting yourself to learn from the past.
As system architects do, why no transcend the boundaries of the utility itself to learn from the whole power system, that is trying to emerge since the 80s? The emergent future is a paradigm shift, which is discontinuous from the present. As mentioned in the EWPC article Propelling the Power Industry to a Superior Solution Path, Mr. Steve Pullins (and much earlier myself) most of the value creation is occurring after the meter, in a vibrant open market where many disruptive technologies are available.
Those disruptive technologies, however, are generating a very costly everyone for himself (EFH) market, that I started to mentioned after the IEEE Power & Energy article a Dominican strategy, as Dominican “customers have invested large amounts of money to reduce shortage costs individually.” As we look carefully, the same thing has been happening in the U.S., as can be seen in the post U.S Power Service is Regulated as a 3rd World Country, that says:
According to the Galvin Electricity Initiative, "the U.S. electric power system is designed and operated to meet a ‘3 nines’ reliability standard. This means that electric grid power is 99.97% reliable. While this sounds good in theory, in practice it translates to interruptions in the electricity supply that cost American consumers an estimated $150 billion a year… In other words, for every dollar spent on electricity, consumers are spending at least 50 cents on other goods and services to cover the costs of power failures...”
That is how large was already the vibrant U.S. EFH market when that quote was made. It is easy to know that as digital penetration increases, that competitive market will keep growing, while leaving behind an obsolete IOUs market. That is why Mr. Pullins findings lead to the awareness needed for IOUs investors to adopt as soon as possible the EWPC paradigm in their favor.
Sufices to say that the EWPC paradigm separates the whole emerging system into two subsystems that mutually reinforce each other. One open wholesale and retail market system and one regulated transportation (T&D) only system that should evolve into the smart grid. That is the vision.
Besides the above documents, among the more that 130 EWPC articles, I suggest to start reading this two:
1) The Sixth Disruptive Technology
2) Leadership Answers What to do First
Regards,
José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
EWPC System Architect
Taleb: Hay que Cambiar el Sistema
Jose Antonio Vanderhorst Silverio ha comentado el vídeo Roubini and Taleb discuss the crisis
Excelentes uugerencias que podríamos aplicar para cambiar el sistema del sector eléctrico
Roubini and Taleb tell CNBC Geithner will fail
Submitted by Tony Wikrent on Mon, 02/09/2009 - 21:12. financial collapse Macro Economics Nasem Taleb Nouriel Roubini TARP Wall Street rescue
CNBC has a ten-minute interview with Nouriel Roubini and Nasem Taleb in which Taleb said Geithner is "that class of people who have failed, and they're going to fail again."
The entire interview is an interesting example of how insane media people are. They kept trying to get Roubini and Taleb to provide investment recommendations, to which Roubini and Taleb all but said "You stupid horses asses, the world economy is collapsing! There's no investment that's safe right now, and there won't be any safe investments until the whole rotten system is replaced!"
One of the CNBC idiots even said that since such horrible bears as Roubini and Taleb have achieved "rock star status" it's a sure sign that the bottom has been reached. Honest! (I wish I could make this crap up, and make a living writing best-selling novels.)
Taleb especially kept trying to pound home the idea that the entire system is intellectually bankrupt as well as financially insolvent, and there is no solution other than to change the system. He also said we need to get rid of the people that failed. Incredibly, the ditzes of CNBC wanted to know who had failed. The first name out of Taleb's mouth was Ben Bernanke.
Like I wrote above, this is a classic example of main stream media insanity. And, it's also a good antidote to the euphoria that President Obama generated with his first press conference, which gave the nation proof positive that we finally have a chief executive able to coherently string together more than two sentences.
Geithner's show is tomorrow, and I suspect that it's going to be difficult to launch any criticism of what he unveils against the tide of good will the President created this evening.
Excelentes uugerencias que podríamos aplicar para cambiar el sistema del sector eléctrico
Roubini and Taleb tell CNBC Geithner will fail
Submitted by Tony Wikrent on Mon, 02/09/2009 - 21:12. financial collapse Macro Economics Nasem Taleb Nouriel Roubini TARP Wall Street rescue
CNBC has a ten-minute interview with Nouriel Roubini and Nasem Taleb in which Taleb said Geithner is "that class of people who have failed, and they're going to fail again."
The entire interview is an interesting example of how insane media people are. They kept trying to get Roubini and Taleb to provide investment recommendations, to which Roubini and Taleb all but said "You stupid horses asses, the world economy is collapsing! There's no investment that's safe right now, and there won't be any safe investments until the whole rotten system is replaced!"
One of the CNBC idiots even said that since such horrible bears as Roubini and Taleb have achieved "rock star status" it's a sure sign that the bottom has been reached. Honest! (I wish I could make this crap up, and make a living writing best-selling novels.)
Taleb especially kept trying to pound home the idea that the entire system is intellectually bankrupt as well as financially insolvent, and there is no solution other than to change the system. He also said we need to get rid of the people that failed. Incredibly, the ditzes of CNBC wanted to know who had failed. The first name out of Taleb's mouth was Ben Bernanke.
Like I wrote above, this is a classic example of main stream media insanity. And, it's also a good antidote to the euphoria that President Obama generated with his first press conference, which gave the nation proof positive that we finally have a chief executive able to coherently string together more than two sentences.
Geithner's show is tomorrow, and I suspect that it's going to be difficult to launch any criticism of what he unveils against the tide of good will the President created this evening.
miércoles, febrero 18, 2009
How to Increase the Leverage of Stimulus Bill to Global Green Energy
By balancing the influence of supply side and demand side, it is possible to develop retail markets and wholesale markets that mutually reinforce each other to increase the leverage of the economic stimulus and to set a leadership example for the whole world.
How to Increase the Leverage of Stimulus Bill to Global Green Energy
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 18th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Kevin Bullis post The Stimulus Will be a Boon to Green Energy, dated Tuesday, February 17, 2009, is synthesized with “The law, to be signed today, will help renewable energy businesses and improve efficiency.”
There should be no doubt that a green revolution is in the making, with the stimulus bill missing only a highly leverage systemic paradigm shift to increase its global leverage, for which DOE, IOUs investors, and the global society in general, have strong arguments. Today’s old paradigm has a center of attraction that favors the supply side fossil fuels, but does not favors demand side renewable energy and energy efficiency.
The new paradigm, which is neutral to the supply side and the demand side, will exert a great leverage attraction to the demand side, just to balance the accumulated excesses on the supply side induced by the old paradigm. The leverage comes from the electricity without price control (EWPC) market architecture and design paradigm.
As can be seen in the EWPC article Propelling the Power Industry to a Superior Solution Path, the assumption that competitive wholesale markets are a prerequisite to efficient retail markets have been disproved. As can also be seen in the EWPC article, that assumption went against the warnings of the late M.I.T. professor Fred Charles Schweppe and his colleagues, back in the 80s. Dr. Schweppe, the leading power systems control authority at the time, suggested an “energy marketplace [that] involves the utility and its customers operating as partners,” which is the essence of the smart grid initiatives. EWPC is an extension of Schweppe’s the Spot Pricng of Electricty.
That flawed assumption had a global pervasive impact. With its origin in EPAct 92, the assumption got even into the purpose of the COMPETE Coalition, which advocates: “… well functioning, competitive wholesale electricity markets which enable state governments to implement retail electric service options best sited to their regional needs and which enable consumers to benefit from the best possible price and service." We all know that organized wholesale markets have undergone a series of costly incremental extensions under the attraction of the old paradigm.
EWPC extends Schweppe’s development by involving customers operating as partners of the utility to make a big difference: “Under EWPC, retail electric service is not simply enabled by wholesale electricity markets. Retail electric markets and wholesale electricity markets mutually reinforce each other to provide a fully functional [competitive] electric service. That is why EWPC is able to produce a superior solution path through innovation in retail electric service at the federal level.”
Please read the EWPC article to learn about the strong arguments that DOE, IOUs investors and the general public have in order to convince state governments to join them. The article summary says; “To raise the competitive balance of the power industry to a superior solution path, “public utility commissions … have to let go of their authority to regulate rates at the retail level.” PUCs need to let go in order to enact an EWPC based EPAct that opens to competition a federal wholesale and retail electricity market, creating investments, innovations, and jobs with a lot future.”
How to Increase the Leverage of Stimulus Bill to Global Green Energy
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 18th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Kevin Bullis post The Stimulus Will be a Boon to Green Energy, dated Tuesday, February 17, 2009, is synthesized with “The law, to be signed today, will help renewable energy businesses and improve efficiency.”
There should be no doubt that a green revolution is in the making, with the stimulus bill missing only a highly leverage systemic paradigm shift to increase its global leverage, for which DOE, IOUs investors, and the global society in general, have strong arguments. Today’s old paradigm has a center of attraction that favors the supply side fossil fuels, but does not favors demand side renewable energy and energy efficiency.
The new paradigm, which is neutral to the supply side and the demand side, will exert a great leverage attraction to the demand side, just to balance the accumulated excesses on the supply side induced by the old paradigm. The leverage comes from the electricity without price control (EWPC) market architecture and design paradigm.
As can be seen in the EWPC article Propelling the Power Industry to a Superior Solution Path, the assumption that competitive wholesale markets are a prerequisite to efficient retail markets have been disproved. As can also be seen in the EWPC article, that assumption went against the warnings of the late M.I.T. professor Fred Charles Schweppe and his colleagues, back in the 80s. Dr. Schweppe, the leading power systems control authority at the time, suggested an “energy marketplace [that] involves the utility and its customers operating as partners,” which is the essence of the smart grid initiatives. EWPC is an extension of Schweppe’s the Spot Pricng of Electricty.
That flawed assumption had a global pervasive impact. With its origin in EPAct 92, the assumption got even into the purpose of the COMPETE Coalition, which advocates: “… well functioning, competitive wholesale electricity markets which enable state governments to implement retail electric service options best sited to their regional needs and which enable consumers to benefit from the best possible price and service." We all know that organized wholesale markets have undergone a series of costly incremental extensions under the attraction of the old paradigm.
EWPC extends Schweppe’s development by involving customers operating as partners of the utility to make a big difference: “Under EWPC, retail electric service is not simply enabled by wholesale electricity markets. Retail electric markets and wholesale electricity markets mutually reinforce each other to provide a fully functional [competitive] electric service. That is why EWPC is able to produce a superior solution path through innovation in retail electric service at the federal level.”
Please read the EWPC article to learn about the strong arguments that DOE, IOUs investors and the general public have in order to convince state governments to join them. The article summary says; “To raise the competitive balance of the power industry to a superior solution path, “public utility commissions … have to let go of their authority to regulate rates at the retail level.” PUCs need to let go in order to enact an EWPC based EPAct that opens to competition a federal wholesale and retail electricity market, creating investments, innovations, and jobs with a lot future.”
martes, febrero 17, 2009
Síntesis Estado del Arte de Industria Eléctrica
Los intercambios que se han producido debajo del artículo Propelling the Power Industry to a Superior Solution Path, han generado una primera versión del Estado del Arte de la industria eléctrica. Lo que sigue es una adaptación de esa primera versión del mercado americano al dominicano. Los antecedentes aparecen en dicho articulo.
Sin tratar de ser exhaustivo, ni perfecto, el Estado del Arte de la industria eléctrica envuelve:
Sin tratar de ser exhaustivo, ni perfecto, el Estado del Arte de la industria eléctrica envuelve:
Una separación de la distribución física de la comercialización al detalle para crear valor a los inversionistas y los clientes;
Sin distribuidoras desagradables bajo la EWPC, la política primero confiabilidad, segundo economía, es la clave para reducir los precios. La EWPC ayudará a crear “inversiones, innovaciones, y puestos de trabajo con mucho futuro,” permitiendo que los clientes puedan alterar la forma en que compran electricidad, como Schweppe imaginó.
Los agentes privados no deben ignorar el mercado Sálvese Quien Pueda (SQP) donde la creación de valor está creciendo rápidamente ni pelear con los consumidores; el mercado SQP que está después del medidor está en la Zona Con Rentabilidad, mientras, para todos los propósitos prácticos, los agentes antes del medidor, están ya en la Zona Sin Rentabilidad y deslizándose muy rápido.
“Para mantenerse relevante ante los clientes,” los agentes privados con mentalidad competitiva, que están dispuestos a arriesgarse, están a favor de un mercado libre a nivel nacional, basado en los elementos esenciales de la EWPC; se requieren modelos de negocios innovadores para integrar el mercado SQP a la planificación, operación y control del sistema interconectado, para pasar a la Zona Con Rentabilidad.
Los mejores agentes privados con mentalidad monopólica, que no están dispuestos a arriesgarse, tratarán fusiones y adquisiciones de otras redes.
Tan pronto se promulgue una ley de electricidad basada en la EWPC, la industria eléctrica podrá ser propulsada por medio de un proceso a una meseta mucho más elevada.
lunes, febrero 16, 2009
Diario Libre: Mesa Energía hace 26 Propuestas Fueron Consensuadas en Cumbre
Tomado de Diario Libre
Buscan priorizar energía base a bajo costo con carbón mineral
SANTO DOMINGO. La mesa de electricidad, hidrocarburos y energía renovables consensuó una propuesta de 26 puntos durante la primera fase de la Cumbre por la Unidad Nacional Frente a la Crisis Mundial, donde se plantea entre otros temas la reducción gradual del subsidio energético a más tardar el 30 de junio del 2010.
La iniciativa procura disminuir los kilovatios de 700 a 200 y el desmonte del Programa de Reducción de Apagones (PRA) acogiendo para tales fines un cronograma que elaboró la Corporación Dominicana de Empresas Eléctricas Estatales (CDEEE).
El cronograma reduce la participación del PRA en el suministro total de energía desde un 12.21% hasta un 7.67% durante el 2009.
También se propuso la implementación de una tarifa técnica, calculando el valor agregado de distribución (VAD) de las Distribuidoras de Energía para ponerlo en ejecución a más tardar en junio del 2010.
En la mesa además hubo acuerdo en solicitar a la Comisión Presidencial para el Apoyo al Sector Eléctrico promover la contratación de proyectos para la reducción de pérdidas y la comercialización.
Asimismo, en modificar en un plazo no mayor de 90 días el reglamento de la Ley 57-07 para que se permita la venta de energía renovable a cualquier agente del mercado y no exclusivamente a la CDEEE. Buscan priorizar la energía base de bajo costo mediante la utilización de carbón mineral y gas natural.
"Declarar de alto interés nacional la conversión de las plantas de gas de San Pedro de Macorís para el Uso de gas natural", refiere una de las propuestas.
Durante tres semanas distintos representantes del empresariado y la sociedad civil presentaron propuestas que tienen una implicación presupuestaria de RD$26,800 millones. La primera etapa concluyó el pasado viernes 13 y para el próximo jueves 19 en la Pontificia Universidad Católica Madre y Maestra (PUCMM) de Santiago se celebrará una plenaria donde serán presentadas las propuestas consensuadas.
Noticia original
Buscan priorizar energía base a bajo costo con carbón mineral
SANTO DOMINGO. La mesa de electricidad, hidrocarburos y energía renovables consensuó una propuesta de 26 puntos durante la primera fase de la Cumbre por la Unidad Nacional Frente a la Crisis Mundial, donde se plantea entre otros temas la reducción gradual del subsidio energético a más tardar el 30 de junio del 2010.
La iniciativa procura disminuir los kilovatios de 700 a 200 y el desmonte del Programa de Reducción de Apagones (PRA) acogiendo para tales fines un cronograma que elaboró la Corporación Dominicana de Empresas Eléctricas Estatales (CDEEE).
El cronograma reduce la participación del PRA en el suministro total de energía desde un 12.21% hasta un 7.67% durante el 2009.
También se propuso la implementación de una tarifa técnica, calculando el valor agregado de distribución (VAD) de las Distribuidoras de Energía para ponerlo en ejecución a más tardar en junio del 2010.
En la mesa además hubo acuerdo en solicitar a la Comisión Presidencial para el Apoyo al Sector Eléctrico promover la contratación de proyectos para la reducción de pérdidas y la comercialización.
Asimismo, en modificar en un plazo no mayor de 90 días el reglamento de la Ley 57-07 para que se permita la venta de energía renovable a cualquier agente del mercado y no exclusivamente a la CDEEE. Buscan priorizar la energía base de bajo costo mediante la utilización de carbón mineral y gas natural.
"Declarar de alto interés nacional la conversión de las plantas de gas de San Pedro de Macorís para el Uso de gas natural", refiere una de las propuestas.
Durante tres semanas distintos representantes del empresariado y la sociedad civil presentaron propuestas que tienen una implicación presupuestaria de RD$26,800 millones. La primera etapa concluyó el pasado viernes 13 y para el próximo jueves 19 en la Pontificia Universidad Católica Madre y Maestra (PUCMM) de Santiago se celebrará una plenaria donde serán presentadas las propuestas consensuadas.
Noticia original
domingo, febrero 15, 2009
Propelling the Power Industry to a Superior Solution Path
To raise the competitive balance of the power industry to a superior solution path, “public utility commissions … have to let go of their authority to regulate rates at the retail level.” PUCs need to let go in order to enact an EWPC based EPAct that opens to competition a federal wholesale and retail electricity market, creating investments, innovations, and jobs with a lot future.
Propelling the Power Industry to a Superior Solution Path
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 15th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
This article is a follow up that reinforces the essence of the EWPC article Just as Pogo, IOUs Found the Enemy. This is done while following a set of personal opinions provided a few weeks ago by Mr. James Carson. It can be inferred that a regulation deregulation debate is a costly distraction for all stakeholders, especially for IOUs.
To support even more that IOUs met the enemy, I found strong findings that have also been made at DOE, by a team led by Steve Pullings. A key example can be found in the article How Private Investment Is Pushing Utilities to the Edge, where Mr. Pullings gives three options on the trend that innovations and investment “are turning new companies into competitors for utility customer attention and dollars:”
All three options lead to the same conclusion: Just as Pogo, IOUs “met the enemy and he is us.” If the customer is not the enemy, just as Pogo they are. If they choose to ignore the trend, sooner or later they will see that they are their own enemy. However, as they recognize being their own enemy and decide to get involved, IOUs investors need to push for regulatory policies that enable the EWPC market architecture and design paradigm.
As readers may recall, under the EWPC article Breakthrough Suggestions for Today's Utilities Environments, Warren Causey wrote: “In order to adopt EWPC, public utility commissions would have to let go of their authority to regulate rates at the retail level. This is a political issue. PUCs are political entities. Commissioners pretend to believe they are "serving the public interest" by protecting the public from nasty old utilities.”
Most of the responses to Mr. Carson that I will provide below, can be found on the interchanges we had two years ago, under the article Playing with Fire - The 10 Tcf/year Supply Gap -- Part I, by Andrew Weissman, Editor-in-Chief & Publisher, EnergyBusinessWatch.com. Other elements can be found on my presentation at Carnegie Mellon University a few months later.
1. Fred C. Schweepe was one of the few holders of institutional memory.
Mr. Carson changed a bit his opinion about Schweppe as he read occasionally in the past two years. But my opinion is that Schweppe held institutional memory back in the 80s. As an example of key insights, Prof. Schweppe and his team made two critical warnings, which I posted on 12.20.06 under the Playing With Fire article:
In those days the warnings should have been considered as tall orders, but they were just ignored by using the wisdom of crowds (more below). Instead, an immense value destruction, not just for the U.S., but for the global power industry, as the dangerous and negative results came true, in addition to the destruction of the economics and physical security, as the policy economy first, reliability second (E1R2) was deployed with organized markets.
2. The separation of the Anti-System Utility
Mr. Carson opinion is that IOUs have changed their opinion considerably, but forgot to talk about the key issue: about the separation of the grid and the enterprise, as Warren Causey calls them, to enable deregulation that considers the demand side of the supply-demand equation as physical distribution is kept regulated, but retail gets deregulated (with prudential regulations). Readers can take a look at the EWPC article The Anti-System Utility, by hitting its hyperlink. This is part of what the article says:
So, as nasty old IOUs became regulated anti-utility they have no longer a chance to get involved. To get involved, IOUs investors will need to compete as 2GRs under an EWPC energy policy act (EPAct). Otherwise, they shoul become regulated wires only utilities.
3. Center attention in the essential systemic elements of the transformation.
While the devil is in the details, we can forget them as I explain now. Any professional system architect, which knows how to get the true systems’ requirements, will agree with me. The practice of system architecture is powerful because it allows separating the essential systemic elements from the many different incarnations. To restructure the power industry under EWPC only the true requirements are needed. In fact, active demand calls for active distribution. Passive demand and distribution was a hidden underlying assumption made by William Hogan when he claimed that “Retail Access is Easy, It’s Getting Wholesale Access that is Hard.” In slide 7 of the my presentation says:
4. The policy reliability first, economy second (R1E2) is based on the essential ultraquality imperative
In the first point above, Schweppe and his colleagues had the “…concern that the economics and physical security of the power systems not be destroyed or compromised.” Just as the architeture and design of a nuclear power plant or a deep space vehicle, which needs to meet the ultraquality imperative, power system (R1) architecture and design can not be done by the wisdom of crouds as should be done polically for money system (E2) of the open market. To address the concern, there is a need for the R1E2 policy to lift the competitive balance to a superior solution path. Positive feedbacks are actually to be enabled by customer utility interactions.
5. Active Demand is another essential systemic element not considered at the outset of deregulation.
As explained in point 3, Dr. Hogan claim that retail access because he misunderstood Schweppe. In a post under the “Playing with Fire…” Energy Pulse article I quoted Schweppe et al saying that:
It is really a pity that Hogan misunderstood that Demand Response had been around longer than deregulation. That means that wholesale deregulation without retail deregulation has destroyed “the economics and physical security of the power systems.” In addition, under EWPC article Demand Integration is NOT the Province of Politics, it is only in the "2007 Assessment of Demand Response and Advanced Metering," that “the Federal Energy Regulatory Commission (FERC) has issued the incorporation of demand response to transmission planning.”
6. The excessive complexity of organized wholesale markets is the result of the restructuring mistake.
The way to avoid the extremely destructive and uncertain method is to apply system architecture to find the true requirements, as mentioned in point 3. By discovering the essential systemic elements it is possible to apply the lesson that Dee Hock, CEO Emeritus VISA International, gave us: “Simple, clear purpose and principles give rise to complex and intelligent behavior. Complex rules and regulations give rise to simple and stupid behavior.”
7. To forget distracting details, a system architect is needed
DOE and IOUs will agree that with the system architecture approach, we can forget the details by selecting a system architect to lead the effort of developing an attractive open federal market as suggested in the EWPC article To Dr. Chu: Align Stimulus to Clean Energy Reform.
Propelling the Power Industry to a Superior Solution Path
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on February 15th, 2009.
Copyright © 2009 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
This article is a follow up that reinforces the essence of the EWPC article Just as Pogo, IOUs Found the Enemy. This is done while following a set of personal opinions provided a few weeks ago by Mr. James Carson. It can be inferred that a regulation deregulation debate is a costly distraction for all stakeholders, especially for IOUs.
To support even more that IOUs met the enemy, I found strong findings that have also been made at DOE, by a team led by Steve Pullings. A key example can be found in the article How Private Investment Is Pushing Utilities to the Edge, where Mr. Pullings gives three options on the trend that innovations and investment “are turning new companies into competitors for utility customer attention and dollars:”
Utilities may choose to fight this trend when it starts to show harm to the bottom line, but the fight may be with the consumer. It is not a good plan to make an enemy of your customer base while trying to retain them.
Utilities may choose to ignore this Edge investment movement. However, this can only be a short-term strategy until revenue loss forces reconsideration of this strategy.
Utilities may choose to get involved in the Edge Movement. While risky and not a typical space for utilities, it may be the only way to stay relevant to customers. This means new business models and new unregulated (probably) lines of business. Today, internal and regulatory policies do not recognize this need. Utilities could leverage this consumer interest in ET [energy technologies] with regulators.
All three options lead to the same conclusion: Just as Pogo, IOUs “met the enemy and he is us.” If the customer is not the enemy, just as Pogo they are. If they choose to ignore the trend, sooner or later they will see that they are their own enemy. However, as they recognize being their own enemy and decide to get involved, IOUs investors need to push for regulatory policies that enable the EWPC market architecture and design paradigm.
As readers may recall, under the EWPC article Breakthrough Suggestions for Today's Utilities Environments, Warren Causey wrote: “In order to adopt EWPC, public utility commissions would have to let go of their authority to regulate rates at the retail level. This is a political issue. PUCs are political entities. Commissioners pretend to believe they are "serving the public interest" by protecting the public from nasty old utilities.”
Most of the responses to Mr. Carson that I will provide below, can be found on the interchanges we had two years ago, under the article Playing with Fire - The 10 Tcf/year Supply Gap -- Part I, by Andrew Weissman, Editor-in-Chief & Publisher, EnergyBusinessWatch.com. Other elements can be found on my presentation at Carnegie Mellon University a few months later.
1. Fred C. Schweepe was one of the few holders of institutional memory.
Mr. Carson changed a bit his opinion about Schweppe as he read occasionally in the past two years. But my opinion is that Schweppe held institutional memory back in the 80s. As an example of key insights, Prof. Schweppe and his team made two critical warnings, which I posted on 12.20.06 under the Playing With Fire article:
The deregulation concept of this chapter is based on a supply and demand marketplace. Most of the other deregulation literature is oriented only to the supply side i.e., to deregulating generation without altering the way users buy electricity. We believe that deregulation which considerers only the supply side of the supply-demand equation is very dangerous and could have very negative results… A second major difference between this chapter and most of the rest of the deregulation literature lies in our concern that the economics and physical security of power systems not be destroyed or compromised.
In those days the warnings should have been considered as tall orders, but they were just ignored by using the wisdom of crowds (more below). Instead, an immense value destruction, not just for the U.S., but for the global power industry, as the dangerous and negative results came true, in addition to the destruction of the economics and physical security, as the policy economy first, reliability second (E1R2) was deployed with organized markets.
2. The separation of the Anti-System Utility
Mr. Carson opinion is that IOUs have changed their opinion considerably, but forgot to talk about the key issue: about the separation of the grid and the enterprise, as Warren Causey calls them, to enable deregulation that considers the demand side of the supply-demand equation as physical distribution is kept regulated, but retail gets deregulated (with prudential regulations). Readers can take a look at the EWPC article The Anti-System Utility, by hitting its hyperlink. This is part of what the article says:
When an organization operates as a system, the value of the whole is greater than sum of the value of its parts.
Reading carefully the article by Warren Causey, I come to the following conclusion:
The sum of the potential value of the grid plus the sum of the potential value of the enterprise is greater than the potential value of the utility, meaning that the utility instead of being organized as a system, it can be though as an anti-system.
What is the problem? Incumbent’s monopoly mindsets and political interference.
The monopoly utility operates a cash cow and so the priority is the enterprise, not the grid, nor customer service. In addition, the utility is also a political target. So grid’s investments are postponed, over and over.
What’s the solution? To restructure by a paradigm shift from VIUs to EWPC.
In order to make the industry robust, competitive and fully functional, EWPC separates the utility grid from the enterprise, with the former integrated to transmission and the latter open to competition. When that is done, the new utility becomes the transportation grid and several 2GRs (see link Second Generation Retailer - 2GR) take over a segment of the market by adding to their part of the enterprise the non-trivial functions of competition and integration of demand to the industry. Incumbents IOUs should decide whether they select one and only one of three activities (no Chinese walls allowed) of the restructured industry: generation, transportation, and retail.
As the grid is integrated with transmission, the resulting transportation utility budget is applied entirely to the modernization of the greater grid in a given area. As the regulated enterprise is transformed into several competing enterprises (aka Second Generation Retailers), the political target disappears, and investments, innovations, and jobs with a lot future are created.
So, as nasty old IOUs became regulated anti-utility they have no longer a chance to get involved. To get involved, IOUs investors will need to compete as 2GRs under an EWPC energy policy act (EPAct). Otherwise, they shoul become regulated wires only utilities.
3. Center attention in the essential systemic elements of the transformation.
While the devil is in the details, we can forget them as I explain now. Any professional system architect, which knows how to get the true systems’ requirements, will agree with me. The practice of system architecture is powerful because it allows separating the essential systemic elements from the many different incarnations. To restructure the power industry under EWPC only the true requirements are needed. In fact, active demand calls for active distribution. Passive demand and distribution was a hidden underlying assumption made by William Hogan when he claimed that “Retail Access is Easy, It’s Getting Wholesale Access that is Hard.” In slide 7 of the my presentation says:
The death of Fred Schweppe in 1988 and a misunderstanding by William Hogan in 1992 of Schweppe’s work on the energy marketplace were “small chance events early in the history of” deregulation that “tilt[ed] the competitive balance, ”to an inferior solution path, as W. Brian Arthur explained in general in his Scientific American, February 1990, article “Positive Feedbacks in the Economy.”
4. The policy reliability first, economy second (R1E2) is based on the essential ultraquality imperative
In the first point above, Schweppe and his colleagues had the “…concern that the economics and physical security of the power systems not be destroyed or compromised.” Just as the architeture and design of a nuclear power plant or a deep space vehicle, which needs to meet the ultraquality imperative, power system (R1) architecture and design can not be done by the wisdom of crouds as should be done polically for money system (E2) of the open market. To address the concern, there is a need for the R1E2 policy to lift the competitive balance to a superior solution path. Positive feedbacks are actually to be enabled by customer utility interactions.
5. Active Demand is another essential systemic element not considered at the outset of deregulation.
As explained in point 3, Dr. Hogan claim that retail access because he misunderstood Schweppe. In a post under the “Playing with Fire…” Energy Pulse article I quoted Schweppe et al saying that:
It turns out, that Schweppe’s said: "conventional metering is replaced by a Marketing Interface to Customer (MIC) which, in addition to measuring power usage, multiplies the usage by posted price and records the total cost [3]," which means that Homeostatic Utility Control was what we are now calling demand response.
The regulated “energy marketplace involves the utility and its customers operating as partners… Utility implementation concerns include real-time calculation/prediction of hourly spot prices, metering-communication-billing, and system control center operation using the new control signal called price… customers who choose to exploit the energy marketplace potentials must implement the appropriate response systems (today demand response), which could range from simple manual response to sophisticated digital controls…”
It is really a pity that Hogan misunderstood that Demand Response had been around longer than deregulation. That means that wholesale deregulation without retail deregulation has destroyed “the economics and physical security of the power systems.” In addition, under EWPC article Demand Integration is NOT the Province of Politics, it is only in the "2007 Assessment of Demand Response and Advanced Metering," that “the Federal Energy Regulatory Commission (FERC) has issued the incorporation of demand response to transmission planning.”
6. The excessive complexity of organized wholesale markets is the result of the restructuring mistake.
The way to avoid the extremely destructive and uncertain method is to apply system architecture to find the true requirements, as mentioned in point 3. By discovering the essential systemic elements it is possible to apply the lesson that Dee Hock, CEO Emeritus VISA International, gave us: “Simple, clear purpose and principles give rise to complex and intelligent behavior. Complex rules and regulations give rise to simple and stupid behavior.”
7. To forget distracting details, a system architect is needed
DOE and IOUs will agree that with the system architecture approach, we can forget the details by selecting a system architect to lead the effort of developing an attractive open federal market as suggested in the EWPC article To Dr. Chu: Align Stimulus to Clean Energy Reform.
viernes, febrero 13, 2009
Esperando Invitación del Comité Presidencial
Dr. Leonel Fernández, presidente de la República y del
Comité Presidencial para el Fortalecimiento del Sector Eléctrico
Señores asesores del referido Comité
CDEEE, secretario de dicho Comité
De mi más elevada consideración:
Como ha sido divulgado por la prensa, el próximo 27 de febrero, el Presidente Fernández anunciará las propuestas que acogerá el gobierno. En el caso de la electricidad, entiendo que lo hará con base a la sabiduría y el poder de sus asesores en el Comité Presidencial. Hoy visité el Hotel Dominican Fiesta para participar en la evaluación y encontré que la Mesa sobre Energía no estaba programada para sesionar.
Mi plan era presentar importantes inconsistencias, como, por ejemplo, las que identifiqué con las notas Efectos Secundarios de las Propuestas Consensuadas en la Mesa de Energía y La Capitalización Ofrece la Electricidad Más Cara. Es de notar, que la primera de las propuestas consensuadas en la referida Mesa les pasa el control a ustedes, lo cual podría muy bien explicar la razón de que dicha Mesa no sesionara. Así que espero que lean atentamente dichas ejemplos que corroboran la lección de Platón: “El principio es la parte más importante del trabajo,” que respalda mi solicitud de reunirme con ustedes en su primera reunión de trabajo.
Esas inconsistencias se explican porque en la reestructuración de los mercados eléctricos se cometió un error trascendental al principio de dicho proceso. Al ser seleccionado por la Federación Nacional de Comerciantes y Empresarios de la República Dominicana (Fenacerd) y el Consejo Dominicano de Detallistas de Provisiones (Codepro) como su vocero en la primera reunión de la Mesa sobre Energía elaboré la nota Propuesta Sector Comercial en Electricidad e Hidrocarburos y la introduce como una propuesta para el orden emergente. En consonancia con mi solicitud ante ustedes, en dicha propuesta incluí como una medida de corto plazo “designar un experto arquitecto de sistemas, quien seleccionará un equipo de consultores, para diseñar el proyecto de la electricidad sin apagones arbitrarios que resultará en la solución definitiva de la crisis del sector eléctrico.”
Ahora bien, para dar otro ejemplo de referido error trascendental, que se explica con los efectos secundarios y la información de que la capitalización lleva a una electricidad más cara, repito un párrafo de la nota Introducción a la Economía de los Servicios Eléctricos, que publiqué el día de Navidad del 2008, y que les remití a ustedes con el asunto, "RD Debería Ser Líder de la Economía de los Servicios Eléctricos," destacando que el orden vigente no tiene futuro. En respuesta, el Sr. José Luís Corripio me mostró su interés de que me invitaran.
De nuevo es grato reconocer que ustedes, que representan al poder político y al poder económico del país, conforman un Comité Presidencial fuerte, coherente y equilibradamente representativo del futuro dominicano, lo cual es esencial para que dirijan los trabajos dentro de un proceso en que prime la sabiduría.
Quedando al total servicio de ustedes.
Con mucho aprecio, afecto, respeto y admiración, me despido de ustedes.
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
Propulsor de la EWPC
Semilla Orgánica del Grupo Millennium Hispaniola
Comité Presidencial para el Fortalecimiento del Sector Eléctrico
Señores asesores del referido Comité
Monseñor Agripino Núñez Collado, presidente del Consejo Económico y Social;
Lisandro Macarrulla, presidente del CONEP;
Juan Vicini Lluberes, vicepresidente del Grupo Vicini;
Roberto Bonetti, vicepresidente de MercaSID;
Celso Marranzini, dirigente empresarial;
José Luís Corripio, presidente del Grupo Corripio;
Félix García, presidente de Multimedios El Caribe y del Grupo Linda;
Secretario de Estado de Hacienda;
Contralor General de la República;
Secretario de Estado de Economía, Planificación y Desarrollo; y
Consultor Jurídico del Poder Ejecutivo.
CDEEE, secretario de dicho Comité
De mi más elevada consideración:
Como ha sido divulgado por la prensa, el próximo 27 de febrero, el Presidente Fernández anunciará las propuestas que acogerá el gobierno. En el caso de la electricidad, entiendo que lo hará con base a la sabiduría y el poder de sus asesores en el Comité Presidencial. Hoy visité el Hotel Dominican Fiesta para participar en la evaluación y encontré que la Mesa sobre Energía no estaba programada para sesionar.
Mi plan era presentar importantes inconsistencias, como, por ejemplo, las que identifiqué con las notas Efectos Secundarios de las Propuestas Consensuadas en la Mesa de Energía y La Capitalización Ofrece la Electricidad Más Cara. Es de notar, que la primera de las propuestas consensuadas en la referida Mesa les pasa el control a ustedes, lo cual podría muy bien explicar la razón de que dicha Mesa no sesionara. Así que espero que lean atentamente dichas ejemplos que corroboran la lección de Platón: “El principio es la parte más importante del trabajo,” que respalda mi solicitud de reunirme con ustedes en su primera reunión de trabajo.
Esas inconsistencias se explican porque en la reestructuración de los mercados eléctricos se cometió un error trascendental al principio de dicho proceso. Al ser seleccionado por la Federación Nacional de Comerciantes y Empresarios de la República Dominicana (Fenacerd) y el Consejo Dominicano de Detallistas de Provisiones (Codepro) como su vocero en la primera reunión de la Mesa sobre Energía elaboré la nota Propuesta Sector Comercial en Electricidad e Hidrocarburos y la introduce como una propuesta para el orden emergente. En consonancia con mi solicitud ante ustedes, en dicha propuesta incluí como una medida de corto plazo “designar un experto arquitecto de sistemas, quien seleccionará un equipo de consultores, para diseñar el proyecto de la electricidad sin apagones arbitrarios que resultará en la solución definitiva de la crisis del sector eléctrico.”
Ahora bien, para dar otro ejemplo de referido error trascendental, que se explica con los efectos secundarios y la información de que la capitalización lleva a una electricidad más cara, repito un párrafo de la nota Introducción a la Economía de los Servicios Eléctricos, que publiqué el día de Navidad del 2008, y que les remití a ustedes con el asunto, "RD Debería Ser Líder de la Economía de los Servicios Eléctricos," destacando que el orden vigente no tiene futuro. En respuesta, el Sr. José Luís Corripio me mostró su interés de que me invitaran.
Es evidente que las recomendaciones de Bernardo Vega están orientadas a que se siga con el orden vigente con sustanciales mejoras. Debe resultar evidente que el orden vigente no tiene futuro. Por eso, en la nota Solicitud a 1ra. Audiencia del Comité Presidencial para el Fortalecimiento del Sector Eléctrico, sigo la lección de Platón, de que “El principio es la parte más importante del trabajo,” para humildemente sugerir además los elementos de lo que en este artículo es reconocido como la economía de los servicios eléctricos. No debe quedar ninguna duda, que las primeras tareas en la economía de los servicios eléctrico será enfrentar el robo de electricidad de los clientes y también a los clientes. La restructuración del sector es sin lugar a dudas el mejor compromiso irreversible para sacar la política del mismo. En cuanto al mecanismo para pagar los mil millones de dólares que se deben, reitero lo que dice el artículo que me publicó el matutino El Caribe Renegociar con Visión de Futuro.
De nuevo es grato reconocer que ustedes, que representan al poder político y al poder económico del país, conforman un Comité Presidencial fuerte, coherente y equilibradamente representativo del futuro dominicano, lo cual es esencial para que dirijan los trabajos dentro de un proceso en que prime la sabiduría.
Quedando al total servicio de ustedes.
Con mucho aprecio, afecto, respeto y admiración, me despido de ustedes.
José Antonio Vanderhorst Silverio, Ph.D.
Consultor Sistémico: Electricidad
Propulsor de la EWPC
Semilla Orgánica del Grupo Millennium Hispaniola
Suscribirse a:
Entradas (Atom)