Guest Interview with Michael Rufo of Itron
How long have you worked at Itron?
I’ve worked at Itron for seven years.
What is your role at Itron?
I lead Itron’s Consulting and Analysis (C&A) group. Our group works on a wide variety of demand-side management and smart grid-related issues, principally focused on program evaluation, design and market research for energy efficiency, demand response and distributed energy resources.
How long have you been involved in demand side activities?
My entire professional career - 25 years.
What challenges have you faced as a DR professional within your organization and within the industry?
I think the biggest challenge has been around how to connect the dots between where the market is and where we’d like it to be. In some respects, there was a demand response (DR) renaissance that started a decade or so ago, but, at times, it’s as if the first generation of DR (back in the 1980s and early 90s) never happened. Although the industry has certainly advanced quite a bit over the past decade, we still seem to be awaiting one last set of transformations necessary to move from being a niche industry to being a significant, pervasive resource that delivers value to all key stakeholders. I believe smart metering is one of the key foundations of that transformation but a number of other technical, economic and regulatory elements need to come into play to fulfill the full promise of DR.
What changes have you seen in the industry as it relates to DR and EE over the last few years?
In the demand response area, we’ve seen an increased focus on residential programs and automation. We’ve also seen an increased focus on engaging consumers in an ongoing conversation about their electricity usage. This is an interesting area as some aspects of it are really just tweaks that use new technologies to build off of relatively mature efforts that have been going on for more than two decades. Meanwhile others have the promise to be more groundbreaking advances that might leapfrog over some of the more difficult and longstanding barriers to broad and deep DR. Another exciting area is the increasing attention to the integration of renewable energy resources into the grid, especially at a local level, which may generate challenges that are opportunities to create DR value.
What do you expect to be the biggest challenge with implementing DR in the next decade?
Event-based programs such as Peak Time Rebate (PTR) and Critical Peak Pricing (CPP) that, in many segments, still result in manual customer responses will likely be around for quite a few years; however, the management of peak load needs to evolve past event-based, manual programs to more continual load management that is less impactful and lower cost and thereby more beneficial to end-use consumers. Implementing enough automated systems in the field to achieve this level of management is a significant challenge.
In addition, there is a chicken and an egg problem with respect to getting from where we are today to an end-use infrastructure that is broadly DR-enabled and consumer controlled with automation that is continuous and not just binary. In some sense, every piece of long-lived energy consuming equipment purchased today or over the next few years that does not have such capability is a lost opportunity over the life of the equipment. Fortunately, there are a number of exciting technologies that are advancing rapidly to bring down the cost of device monitoring and control, which will, over time, drive the availability and value of the resource up. Small, barely noticeable sheds across a broad set of end-users and a large number of customers should play an increasing role, rather than solely deep cuts in a single end use for a relatively small segment of a population.
Pricing also must evolve more quickly in the mass market. The promise and value of smart metering will not be completely fulfilled without a faster maturation of mass market pricing programs that better reflect costs and value. Modernized regulatory, utility and private sector business models will be needed to stimulate more optimal energy transactions among utilities, energy providers, consumers and “prosumers”.
Lastly, supply-side trends, in particular the potential impact of shale gas, must be closely monitored to ensure DR products and services stay aligned with overall resource and grid needs (and associated costs). Decreasing solar costs are another case in point.
In the meantime, moving consumers to embrace DR programs and invest in automation technologies is still a short-term barrier to greater success.
What advice or guidance would you give to young professionals who are considering a career in demand response and smart grid?
Always maintain multiple fields of vision. You should deep dive early in your career in one or a few specialty areas to develop a particular expertise; however, you will be in a highly dynamic, multi-disciplinary field and need to understand the full panoply of forces acting upon it (e.g., technological, economic, behavioral and political), both in the short and long-term, to fully manifest your potential.
How long have you worked at Itron?
I’ve worked at Itron for seven years.
What is your role at Itron?
I lead Itron’s Consulting and Analysis (C&A) group. Our group works on a wide variety of demand-side management and smart grid-related issues, principally focused on program evaluation, design and market research for energy efficiency, demand response and distributed energy resources.
How long have you been involved in demand side activities?
My entire professional career - 25 years.
What challenges have you faced as a DR professional within your organization and within the industry?
I think the biggest challenge has been around how to connect the dots between where the market is and where we’d like it to be. In some respects, there was a demand response (DR) renaissance that started a decade or so ago, but, at times, it’s as if the first generation of DR (back in the 1980s and early 90s) never happened. Although the industry has certainly advanced quite a bit over the past decade, we still seem to be awaiting one last set of transformations necessary to move from being a niche industry to being a significant, pervasive resource that delivers value to all key stakeholders. I believe smart metering is one of the key foundations of that transformation but a number of other technical, economic and regulatory elements need to come into play to fulfill the full promise of DR.
What changes have you seen in the industry as it relates to DR and EE over the last few years?
In the demand response area, we’ve seen an increased focus on residential programs and automation. We’ve also seen an increased focus on engaging consumers in an ongoing conversation about their electricity usage. This is an interesting area as some aspects of it are really just tweaks that use new technologies to build off of relatively mature efforts that have been going on for more than two decades. Meanwhile others have the promise to be more groundbreaking advances that might leapfrog over some of the more difficult and longstanding barriers to broad and deep DR. Another exciting area is the increasing attention to the integration of renewable energy resources into the grid, especially at a local level, which may generate challenges that are opportunities to create DR value.
What do you expect to be the biggest challenge with implementing DR in the next decade?
Event-based programs such as Peak Time Rebate (PTR) and Critical Peak Pricing (CPP) that, in many segments, still result in manual customer responses will likely be around for quite a few years; however, the management of peak load needs to evolve past event-based, manual programs to more continual load management that is less impactful and lower cost and thereby more beneficial to end-use consumers. Implementing enough automated systems in the field to achieve this level of management is a significant challenge.
In addition, there is a chicken and an egg problem with respect to getting from where we are today to an end-use infrastructure that is broadly DR-enabled and consumer controlled with automation that is continuous and not just binary. In some sense, every piece of long-lived energy consuming equipment purchased today or over the next few years that does not have such capability is a lost opportunity over the life of the equipment. Fortunately, there are a number of exciting technologies that are advancing rapidly to bring down the cost of device monitoring and control, which will, over time, drive the availability and value of the resource up. Small, barely noticeable sheds across a broad set of end-users and a large number of customers should play an increasing role, rather than solely deep cuts in a single end use for a relatively small segment of a population.
Pricing also must evolve more quickly in the mass market. The promise and value of smart metering will not be completely fulfilled without a faster maturation of mass market pricing programs that better reflect costs and value. Modernized regulatory, utility and private sector business models will be needed to stimulate more optimal energy transactions among utilities, energy providers, consumers and “prosumers”.
Lastly, supply-side trends, in particular the potential impact of shale gas, must be closely monitored to ensure DR products and services stay aligned with overall resource and grid needs (and associated costs). Decreasing solar costs are another case in point.
In the meantime, moving consumers to embrace DR programs and invest in automation technologies is still a short-term barrier to greater success.
What advice or guidance would you give to young professionals who are considering a career in demand response and smart grid?
Always maintain multiple fields of vision. You should deep dive early in your career in one or a few specialty areas to develop a particular expertise; however, you will be in a highly dynamic, multi-disciplinary field and need to understand the full panoply of forces acting upon it (e.g., technological, economic, behavioral and political), both in the short and long-term, to fully manifest your potential.
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