Jeff Beale A BATTERY OF CHOICES: WHAT DOES IT MEAN?

Honeywell Smart Energy TechAdvantage 2018

Agenda

Introductions & Honeywell Overview

Market-Size
• by Customer Segment
• by Use-Case
Values in the Electric Supply-chain

Example Use-cases & Financial Impact

Battery Energy Storage: A Threat & an Opportunity

© 2017 by Honeywell International Inc. All rights reserved.
 Meet Jeff Beale

• 13+ years in IoT/M2M & 4 years Smart Grid

• Hardware, Software, Network & Services

• Help Organizations Save Money

• Cross-functional Stakeholder Alignment

• Current Focus:

• Residential Demand Response

• Automated Demand Response (ADR)

• Battery Energy Storage

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A World Connected

Home & Buildings Safety & Performance

Technology Productivity Solutions Aerospace Materials and
Technologies
$ 10.1B $4.5B $ 15.6B $ 10.2B
NEARLY HALF OF HONEYWELL’S PRODUCT PORTFOLIO
DELIVERS ENERGY EFFICIENCY BENEFITS

© 2017 by Honeywell International Inc. All rights reserved.

Who is Honeywell Smart Energy?
• Utility-focused Implementer
Technology Marketing
• 200+ Utilities Served
• Demand-side Management Expert

• Smart Metering (formerly Elster)

Cooperative
• Flexible Services & Technology Program Electric Utility Program
Design Operations
Mission
To help enable utilities to transform
operations, efficiency and reliability Implementation
– through advanced grid solutions
Management
and customer engagement.
© 2017 by Honeywell International Inc. All rights reserved.

Flexible Service Organization that also offers Technology

End-to-End Value Chain

METERING DATA SECURITY GRID ENERGY EFFICIENCY

TECHNOLOGY AND INTEGRITY PROFESSIONAL
MANAGEMENT DEMAND RESPONSE
DISTRIBUTED SERVICES AND
COMMUNICATION ANALYTICS SOFTWARE
ENERGY RESOURCE CONSULTING
TECHNOLOGY SOLUTIONS
MANAGEMENT

© 2017 by Honeywell International Inc. All rights reserved.

 What is a Battery? DER Grid Service Matrix

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Battery Energy Storage
Market Size

The Who

© 2017 by Honeywell International Inc. All rights reserved.

 Market Size by Segment (Utility-Grid, C&I and Residential)

$22.4B
Collective Market of $62B

$15.4B

$11B

$8.2B

$5.2B

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 Utility Scale Size by Use Case
• Generation Capacity: 42% of Installs or $12.5B
• T&D Asset Capacity: 22% of installs or $6.4B
• Frequency Regulation: 9% or $5.8B

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Battery Energy Storage
Supply-chain Values

The What

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Battery Energy Storage: Supply-chain Perspective

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Areas of Value: Market-based Earnings (MBE)

Supports Renewable Balances fluctuations

generation generation assists between electricity
capacity needs with challenges to generation and
grid operators electrical load

Manages reactive Generation Ensures that electricity

power to maintain capacity that is lines, substations, and
the power system’s online and able to other equipment have
voltage at serve load enough bandwidth to
acceptable ranges immediately handle peak demand

© 2017 by Honeywell International Inc. All rights reserved.

 Opportunities to Make an Impact
Function Application Description Capacity Classification
Requirement
Storing energy during low-price periods to
Electricity Cost
Peak Pricing Arbitrage reduce amount of peak-price energy that must 4-6 Hours Bulk Storage
Optimization be purchased.
Ensuring there is enough electricity available at
all times, included both spinning and non-
Bulk Storage
Generation Capacity spinning reserves. This includes the shifting of 2-6 Hours
renewable generation to align with high
Load Serving demand periods.
Ensuring transmission & distribution
Bulk Storage
T&D Asset Capacity infrastructure has sufficient capacity to serve 2-4 Hours
load.
Balances the fluctuations between electricity
generation and electrical load, manages the
Frequency Regulation variability in the grid’s frequency, by pulsing
1-15 Minutes Ancillary Services
Grid Operations large bursts of power on and off the grid.
Manages reactive power to maintain the power
Ancillary Services
Volt/Var Support system’s voltages at acceptable ranges given 1-15 Minutes
the operating conditions it is likely to face.
Refers to smoothing/firming output from wind
Renewable Renewables Ancillary Services
and solar plants, and controlling generation 1-15 Minutes
Integration Ramping/Smoothing ramp rates.

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Battery Energy Storage
Use-Cases

The Why

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Use-Case: Renewable Firming & Arbitrage
• Duck Curve Challenges (West/Southwest)
- Excess daytime generation &
dramatic ramping curves at day-
end during peak-periods
- Storage can serve the ramp and
flatten or fill the “belly”

• Renewables
- Customer usage does not stop California Independent System Operator,
https://www.caiso.com/Documents/FlexibleResourcesHelpRenewables_FastFacts.pdf, 2016 p.3.

during a cloudy or still day!

- Proven to smooth intermittent
renewable generation
- Arbitrage: Buy Low, Sell High (wind)
© 2017 by Honeywell International Inc. All rights reserved.
Use Case: T & D Infrastructure Deferral
• Aging Infrastructure
- 70% of transmission lines and power
transformers are 25+ years old
- 60% of circuit breakers are 30+
- DOE Estimates
“Extending the capability of the transmission
grid—for example by pre-positioning storage
- Benefit: Reduce Grid Construction on the load side of transmission constraint
upgrades & augment existing assets points—makes the grid more secure, reliable,
and responsive,” DOE researchers
U.S. Department of Energy, Grid Energy Storage,
• Power Quality Management https://energy.gov/sites/prod/files/2014/09/f18/Grid%20Energy%20Storage%20December%202013.pdf.

- Rapid-response for frequency regulation

or volt/VAR support.

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Traditional Poles & Wire Upgrade Timeline

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T&D Deferral Example: Alternative Approach

Nav T&D p19

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Develop a Business Case Around T&D Benefits
Assess
Where can you help your
membership & your Grid at the
same time?

How will they be impacted?

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Assess Opportunities to Stack-Value

HONEYWELL SMART ENERGY

Questions?

© 2017 by Honeywell International Inc. All rights reserved.

Honeywell Smart Energy Differentiators
• Smart Grid Consultancy
o Integrator: Need Identification, Design/Scope & Communicate Payback

• Experience
o Military & other Microgrid Battery Energy Storage Experience
o SCADA, Sub-station design, FFR & Automated Demand Response
o Understand Utility Avoided-cost & Solution Value-stacking

• Strategic Smart-Grid Vision

o Data Analytics, Smart Meter, ADR, FFR & Smart-home
o Utility Touchpoints: Residential, Commercial, Industrial & Substation

• Stable, Global-Brand
o Less Risk on Long-term Contract
o Honeywell or Renewable start-up?
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