Serendipity must have been on the menu that day
back in spring 1999 when electrical and computer engineering professor
Bruce Wollenberg
and teaching assistant Aniss Fradi met for a working lunch.
Wollenberg
and Fradi, a doctoral student, were discussing a complex mathematical
problem whose solution had eluded them for months. Doctoral student
Sergio Brignone walked in, saw their calculations on the chalkboard,
and blurted out the answer within seconds.
“Sometimes it takes another pair of eyes,” Wollenberg says with
a chuckle. “You will work on a problem for weeks and not see the
answer, but a casual visitor will walk by and make you look like
a fool."
Thanks to Brignone's fresh perspective, Wollenberg and Fradi gained
a team member and discovered an algorithm that promises to benefit
electric utilities and their customers.
For most of the 20th century, a few utility companies in each
state supplied electrical power to U.S. consumers and businesses.
Each utility staked out its own turf, restricted its service to
that area, and charged rates that were regulated by the federal
government and state public utility commissions. But in the 1990s,
the federal government deregulated the electric utility industry,
offering consumers the prospect of lower costs and the option of
choosing among service providers.
Although slow to take effect in the Midwest, those changes have
occurred in other regions of the country and eventually will benefit
all consumers, say industry experts. However, deregulation also
exposed industry flaws, including an inaccurate loss allocation
system.
A percentage of the electricity flowing through transmission lines
is always lost. Before deregulation, there was less of an incentive
to determine exactly how much loss should be attributed to each
utility company. Losses were distributed among companies using approximate
formulas, and the companies in turn compensated for their added
costs by raising consumer prices.
In the highly competitive deregulated marketplace, however, price
is a critical factor for consumers and utilities alike. Under deregulation,
suppliers in one part of the country can sell energy to a user in
another area, sending the electric power over transmission lines
owned by other utility companies.
The new algorithm can allocate transmission line losses equitably
among the various energy providers using the lines at a given time.
Efficiency—and resulting cost savings—can provide the critical
margin that utilities need in order to stay competitive.
Wollenberg says the new algorithm would distribute transmission
line losses fairly. “Losses could be off by 20 to 30 percent,” Wollenberg
says of past loss calculations. “We've come up with a way of precisely
doing loss allocation."
The calculation initially used trapezoidal integration—a method
of calculating slopes—and multiplication by a small change in
power transfer to obtain the change in losses. Now, Wollenberg says,
they use more advanced methods that can accurately measure electricity
loss to six decimal points.
“If I [as a company] am being overallocated for the losses I'm
sustaining, I [won't have] a happy board of directors,” Wollenberg
says.
Deregulation required a whole new way of measuring loss allocation,
says Vern Albertson, professor emeritus in the Department of Electrical
and Computer Engineering and former head of the Center for Electric
Energy.
Established in 1981, the center promotes and financially supports
electric power and energy engineering research. The center's industry
advisory board, which consists of eight to ten Midwest companies,
recommended that its researchers undertake a study of loss allocation,
an issue that had been neglected for years, according to Albertson.
“Prior to Professor Wollenberg's research on this topic, there
was no accurate method of allocating the costs of these losses to
each electric supplier using the transmission grid. The electric
utilities that owned the transmission grids were in a quandary as
to how to recover these costs,” Albertson says. “Wollenberg's research
is pioneering work in this field and is of critical importance to
the electric utility industry, not only nationally, but internationally
as well. It will be recognized as a major breakthrough and contribution."
The new algorithm could provide a major windfall for companies
that do a good job of preventing energy waste. One public utility
anxiously awaiting the long-term results of Wollenberg's research
is Otter Tail Power Company, a relatively small but highly respected
electric utility based in Fergus Falls, Minnesota. The company has
been working to solve the problem of loss allocation since the 1960s,
when it was absorbing losses caused by transmission of energy from
the Missouri River hydroelectric generating plants to the Minneapolis
loads. Otter Tail is one of the companies that advised the Center
for Electric Energy to study loss allocation.
“Before, the generation using the transmission was mostly serving
the company's load, and the losses were provided by those generators,”
says Larry Larson, manager of delivery operations at Otter Tail.
“We are excited about having more accurate allocations,” he says.
“Currently the Mid-Continent Area Power Pool—which we are members
of—uses a calculation that is inherently in error because of simplified
assumptions."
Most companies in the industry are excited about the University's
research, Larson says, because they want to control their costs.
Some companies have been absorbing costs that are disproportionately
high, relative to the amount of electricity lost through their lines,
he says.
A new loss allocation method must obtain government approval,
so there will be a waiting period before any new system takes effect
nationwide. But as the new method is adopted and deregulation starts
taking effect throughout the country, Wollenberg's research is one
step among many that will help consumers, Larson says.
“In the long run, everyone should benefit because of the competition,”
he says.
