anticipatory consumption
So I have recently handed in my thesis. And typically a day after I handed it in I figured out why I am not happy with what I wrote. Its not so much the pragmatic approach that I took, but the fact that I lost the perspective that actually pushed me towards my theme. The making automatic of markets and their imposition on lived spaces is something I think is interesting, and in my theme (the transition to smart grids) this makes for something of a paradigm shift in the generation/distribution/consumption of electricity. I touched on it, saying that the administration level (in terms of government and regulatory oversight) of the electricity industry can not keep up with the technological change they are engendering, but I did not push through and now I regret that.
There are two major (technological) drivers behind the transition to smart grids. Firstly there is the fact that energy will be generated distributed over the network, secondly there is the fact that most of this generation happens intermittently. New technologies are needed to integrate these new patterns of generation. This is a less linear path in volumes, times and velocity of power production and therefor needs to be mediated to align with the customer's desired uses. Think about it: if we all decided to plug in our electric vehicle at the same time and there is no power to charge them available, the network invariably fails.
A network that would allow bi-directional information exchange is one way to solve this. It is based on a new decentralised structure in which intermediaries through the market regulate power consumption of the households connected to them. They do so by offering electricity to their localised (virtually or geographically, both variants exist) markets and through a bidding process they resolve the amount of forecasted energy available with the scheduled tasks of the customers. By using the micro-economic practices of demand and supply, for each of the participants an optimum is found. Needless to say this system only works with appliances that dispose over flexibility or the ability to shift, shed, store, and curtail loads at demand.
These intermediaries (referred to as aggregators) are somewhere between power brokers and market makers if we conceive of them in terms of the financial market. At each moment in the bidding process they are able to automatically re-align their calls and puts with the forecasted energy consumed and generated by their constituency. Beyond having a connection to their localised market they are also connected to the wholesale market, through which they continuously seek to create a balance between demand and supply in their power portfolio (which could also be in the form of energy futures, but lets leave that for some other time).
What is interesting to me, and what I see as a missed opportunity, is the fact that these portfolio's thrive on expectations of power supply in the network. This means that aggregators calculate the potential of generators in their network through weather forecasts and put out prices that align with the future availability of energy and its demand. This also means that (assuming those generators are connected to smart grids) whenever a surplus of energy would come available the produced would be incentivised to switch of some of their capability. And the same goes for demand, whenever the forecasts paint a picture of sparse energy, customers will be automatically incentivised to hold of on using flexible appliances. So what the smart grid is doing is creating a future through metrics that is almost inevitable when planned for.














