This is the second of two education modules on volt/VAR technologies. Read the first here.
Despite their ability to significantly improve power quality and lower line losses and reduce peak demand compared to traditional methods, VVO systems have not been widely deployed in the U.S. because traditional utility fee structures fail to provide revenue recovery or ROI to pay for the necessary investments.
In November 2012, the National Association of Regulatory Utility Commissioners, representing the public utility commissions of all U.S. states and territories, recognized the need for change through its resolution of support for the adoption and rapid deployment of voltage optimization technologies, with the following statement:
[NARUC] encourages State public service commissions to evaluate the energy efficiency and demand reduction opportunities that can be achieved with the deployment of Volt-Var Optimization (VVO) technologies…and encourages State public service commissions to consider appropriate regulatory cost recovery mechanisms.
NEMA supports the NARUC position and further recognizes an appropriate role for federal support in expediting state adoption of VVO technologies. Federal legislation to improve energy efficiency and advance the electric grid must include incentives to encourage the deployment of voltage management technology and should include incentives for the adoption of State Energy Efficiency Resource Standards, electric utility rate incentives, and/or the establishment of a grid optimization fund to finance necessary upgrades.
Strategies such as conservation voltage reduction (CVR) have numerous potential benefits. This type of VVO solution can be used to flatten voltage profiles and then lower overall system voltage, while staying within the specified ANSI voltage limits. In short, doing this reduces overall system demand by a factor of 0.7–1.0 percent for every one-percent reduction in voltage. From a consumer perspective, this reduces the energy consumed. From a utility perspective, it reduces the amount of power needed to generate or purchase from a generator. There is a cost benefit associated with reduced operating costs, but, to the extent these strategies can be implemented to defer investment in new generation capacity or to address reduced capacity due to old generating assets being taken offline, the benefits can be enormous especially when load growth is small.
Avoiding VAR penalties
In the case of a vertically integrated utility, being able to optimize a power factor means that the utility has to generate less power to satisfy the demand of its customers. In simple terms, certain power factor conditions require utilities to generate more real power than is actually needed by its consumers. This excess real power is wasted in the form of thermal losses. The ability to optimize power factor is a key driver in a utility’s ability to minimize losses. This particular benefit also serves the environment; if a utility has to generate less power to serve the same demand, then, in turn, it burns less coal or natural gas and therefore emits less CO2. Similarly, utilities that purchase power from transmission companies or independent power producers usually have contractual, financial incentives, including steep penalties for operating outside of specified power factor limits.
With the development of microprocessor-based controls and computing platforms, pervasive, high-performance communications technologies, widely deployed sensor technology including advanced metering infrastructure (AMI) systems and advanced software algorithms, it is now possible to coordinate these devices to optimize the broader electrical system at the feeder, substation, or utility level with VVO systems. With these integrated systems in place, utilities can optimize voltage profiles and VAR flow to achieve a variety of objectives, including reducing peak demand, targeting power factor levels to minimize energy losses, and implementing CVR. CVR controls feeder and substation equipment to lower distribution line voltage within approved standard ranges. The result is a significant reduction of loss and energy demand. They can also change target objectives at different times of the day, week, month, or year to meet performance goals.
The devices defined below work together to flatten and lower system voltage (within acceptable limits) to improve power efficiency and to reduce demand. This results in substantial energy savings. Four case studies showing cost savings and energy efficiency gained with VVO can be found in the document “Volt/VAR Optimization Improves Grid Efficiency,” available on the NEMA website.
- Substation transformer load tap changer (LTC): A transformer’s rated voltage may not match the system voltage exactly, or it may be necessary to raise or lower the output voltage to supply a certain load. In these cases, a portion of a winding can be removed or added to change the transformer turns ratio. The simplest tap-changing device operates on a “break before make” principle and changes taps on the primary winding. Such a device cannot be operated when the transformer is carrying load or even when the transformer is energized, because it would break load current and/or magnetizing current. This device is called a tap changer for de-energized operation. Traditionally, this device was called a no-load tap changer, but this description has fallen out of favor because the name implies that it can be operated when the transformer is energized but not carrying load, which is not the case. Most tap changers for de-energized operation have a total of five tap positions. There are usually two tap positions above the nominal voltage rating and two tap positions below the nominal voltage, plus a tap at the nominal voltage. The voltage increments between taps are generally 2.5 percent of the nominal voltage, so the full tap range is +/−5 percent.
- Buck-boost voltage regulator: A voltage regulator is a device that maintains a relatively constant output voltage even though its input voltage may be highly variable. A basic voltage regulator relies on a simple electromechanical design. A wire connected to the circuit is coiled such that it forms an electromagnet. As the voltage in the circuit increases, so does the strength of the electromagnet. This causes an iron core to move towards the electromagnet, which is connected to a power switch. When the moving magnet pulls the switch, it reduces the voltage in a circuit (buck). When the voltage in the circuit decreases, the electromagnet gets weaker. This allows the iron core to move back towards its resting position which turns the switch back on and increases the voltage of the circuit (boost). There are a variety of voltage regulator types based on the particular method they use to control the voltage in a circuit. In general, a voltage regulator functions by comparing its output voltage to a fixed reference and minimizing this difference with a negative feedback loop.
- Actively switched capacitor bank: Capacitors are electrical components that store electrical energy. Capacitors consist of two conductors that are separated by an insulating material. Unlike in batteries, this stored energy is not maintained indefinitely, as the dielectric allows for a certain amount of current leakage which results in the gradual dissipation of the stored energy. In turn, a capacitor bank is a grouping of several identical capacitors inter-connected in parallel or in series as required. The main purpose of a distribution capacitor bank is to counteract or correct a power factor lag or phase shift in an AC power supply. In AC circuits, the power factor is the ratio of the real power that is used to do work to the apparent power that is supplied to the circuit. Power factor correction is an adjustment of the electrical circuit in order to change the power factor near one (known as unity power factor). Lagging power factor is when the current lags the voltage and leading power factor is when the current leads the voltage. Unity power factor refers to the case in which the current and voltage are in the same phase. Power factor correction is usually done by adding capacitors to the load circuit, when the circuit has inductive components, like an electric motor. A power factor of one or more unity power factors is the goal of any electric utility company since, if the power factor is less than one, they have to supply more current to the user for a given amount of power use. Power factor near one will reduce the reactive power in the circuit and most of the power in the circuit will be real power. This reduces power lines losses.
- Active VAR controller: Power electronic FACTS (flexible alternating current transmission systems) devices can control reactive power and, therefore, voltage in a circuit on a continuous basis both accurately and dynamically. The main differences in the performance of traditional voltage control devices when compared to a FACTS device are 1) faster speed of response (milliseconds), 2) finer control, 3) lower maintenance, and 4) increased longevity of secondary equipment. FACTS devices have been proven to be cost-effective in some industrial and transmission system applications but have not yet been widely used in distribution systems. The enabling technology of a FACTS device is a power electronic switch known as an IGBT (insulated gate bipolar transistor), which can switch on and off several times per cycle and operate intermittently or continuously in a reliable manner for many years with very little maintenance. Power electronics can create value for utilities within their distribution systems by allowing them to more accurately and economically control voltage and current. This, in turn, will reduce electrical losses, support the integration of distributed generation and renewable power, and reduce the need for additional distribution lines. All of these factors will make power electronics systems an attractive investment for distribution utilities. The macro trends that are driving the increasing demand for power electronics in the distribution portion of the electrical system are clean power, energy security, and urbanization. The desires to minimize global warming, increase energy security, and make the U.S. electrical grid more efficient have led to federal and state incentives that encourage growth in renewable power and energy storage. The extent of these incentives will likely fluctuate, but it is likely they will continue, in some form, for several years, thus driving a continued increase in renewable power and energy storage across the U.S. grid. All investments in renewable power and energy storage will benefit greatly from advanced technologies and, more specifically, the application of power electronics within the distribution system.
 Anderson, Phillip, P.E. Conservation Voltage Reduction (CVR). Idaho Power, an IDACORP Company. Accessed May 4, 2016. https://www.idahopower.com/pdfs/AboutUs/PlanningForFuture/irp/2013/DecMtgMaterials/ConservatioVoltageReduction.pdf.