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Special Edition: "Innovative Microgrid Solutions Across New York" with Bruce Schadler, Director of Project Management at Veolia [an Energy Central Power Perspectives™ Podcast]

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The ‘Energy Central Power Perspectives™ Podcast’ features conversations with thought leaders in the utility sector. Each two weeks we’ll connect with an Energy Central Power Industry Network...

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  • May 18, 2021 11:30 am GMT
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This item is part of the Special Issue - 2021 - 05 - Grid Modernization, click here for more

The U.S. power grid is getting intense focus from all angles these days, from federal initiatives to spend billions of dollars to upgrade the grid infrastructure all the way down to local projects looking to harden transmission infrastructure. Regardless of the scale or lens, though, a pervading type of solution continues to be identified that can accomplish a myriad of goals: the microgrid. Microgrids are effective and innovative tools that, when utilized optimally, can boost how resilient, affordable, and clean a local power system can be.

In today’s episode, Bruce Schadler joins the Energy Central Power Perspectives Podcast to share with host Jason Price and producer Matt Chester about the vast impact his team has been able to create with targeted microgrid projects. Acting as the Director of Project Management at SourceOne, an energy consulting company for Veolia North America, Bruce and his team have implemented microgrid solutions across New York at sites that include NYU, the New York Public Library, Hudson Yards, and many more. Bruce shares his keen insights about how these solutions, and in particular the Hubgrade service from Veolia, have left an unmistakable fingerprint across the Empire State to prioritize efficiency, digital innovation, sustainability, and resilience.  

A special thanks goes to Veolia North America for supporting this edition of the Energy Central Power Perspectives Podcast.

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Key Links

Bruce Schadler's Energy Central Profile: https://energycentral.com/member/profile/bruce-schadler

 

TRANSCRIPT

Jason Price: 

Hello, and welcome to Energy Central Power Perspectives Podcast. This is the show where we bring in thought leaders and innovators across the utility industry and grill them about the future of the industry and learn about how they're making that utility of tomorrow a reality today. My name is Jason Price of West Monroe, and I'm coming to you from New York City. Joining me, as always, is Energy Central's community manager and podcast producer, Matt Chester. Matt we're diving into the future of microgrids today, with one of the key players working in that space, to solve some of the energy sector's biggest hurdles. Are you ready to hear about the microgrid opportunities that might be coming your way soon?

Matt Chester: 

I sure am. It's a topic that's gotten a lot of great buzz and that's what we're here to do is to learn some more.

Jason Price: 

Indeed. So let's set the stage. The modern US grid is seeing numerous weak spots being highlighted pretty consistently these days. Subpar resilience and reliability, a clean energy transition that's got to move faster than it's been, increasingly common severe weather events undermining grid reliability, stricter environmental regulations constantly coming our way, and more. And in an effort to overcome these challenges, the cost to the customer to get their energy really can't afford to rise. So how do we tackle all these various challenges? Luckily, we can make real and affordable progress toward overcoming these hurdles with one shared solution, and that's microgrids. microgrids are poised to reduce service interruptions, to allow for easy integration of distributed, clean energy sources, and to provide redundancy, resilience, and a hardened grid. And unlike some other solutions being tossed around, microgrids aren't something we have to wait around for. Rather, they're being used by utilities, municipalities, and large energy consumers across the country today.

Jason Price: 

To share some of the ways microgrids are forging a new path to the utility of tomorrow, we welcome to the podcast Bruce Schadler. Bruce is the director of project management at SourceOne, an energy consulting company for Veolia North America. New York state-licensed engineer. With over 20 years of experience, Bruce is one of the foremost leaders on microgrid design and implementation. The projects across the empire state with his fingerprints on them are impressively vast and varied, from implemented microgrid projects at William Floyd School District, to NYU, Intrepid Air and Space Museum, to Hudson Yards, King's Plaza Mall, and more. He's also performed feasibility studies for microgrids at New York Presbyterian Hospital, New York Power Authority, New York Public Library, Grand Central Terminal, and various SUNY campuses. Clearly, his projects truly stretch across many major New York institutions. That experience makes him an expert on not just how to design microgrid projects, but also why different stakeholders should take a long hard look at implementing microgrid projects of their own. And the market is agreeing with them, with the growth of such projects only accelerating.

Jason Price: 

And before we bring Bruce into the podcast booth, let's give a quick thanks to Veolia North America for making today's episode possible. As many of you may know, Veolia North America is a leading environmental solutions company, serving customers in water, waste, and in energy in the US and Canada. We are pleased to be partnering with them to show how the energy market is evolving, and highlight the latest innovations and trends that are best poised to meet the challenging needs of energy consumers, providers, and producers. With that said, let's pull Bruce into the conversation. Bruce Schadler, welcome to today's episode of Energy Central's Power Perspectives Podcast.

Bruce Schadler: 

Thank you, Jason and Matt for having me today. I look forward to sharing my perspective and experiences around microgrids today.

Jason Price: 

Bruce, let's start with defining what is a microgrid? Who are the buyers and has this changed over time?

Bruce Schadler: 

I think there's a lot of interpretations out there around what a microgrid is. Size, does it have to be a certain size, does it had to be part of the utility grid? I think to me, the definition of a microgrid is some type of distributed generation that's connected into utility, either operating in parallel or independently, but is able, at some point, to operate independently around the grid where you have a defined border. So having said that the grid goes down, then this generation can supply a load for whatever set facility. I think it's important to understand, too, that I don't feel microgrids are new. I think they've been around for several years. If you look back to small municipalities and even large industry campuses, they've had large generation in place for over 30 years, for different reasons, for distribution regions where the utility couldn't get out to them, or their load is so big that they couldn't upsize feeders that get to them.

Bruce Schadler: 

So I think based on that, they've been around, they've been classified more as combined heat and power rather than microgrids. But as they connect to the utility grid, they truly become microgrids. I think the buyers you see nowadays have migrated from the small muni’s and the industrial campuses, and you see more hospitals malls, smaller size generation, 5 to 10 megawatts. Reasons for this and why it's changing over time, I think deregulation in the markets some years back had a lot to do with it. I think that utilities are becoming more flexible with their standards and policies.

Bruce Schadler: 

There's definitely a rise in need for reliability and independence due to what seems to be a lot of natural disasters, if you will, coming into play. There's also been a large increase in technology and controls, which has been lowering the capital cost to install a microgrid and making it more available for a wider range of users. And then you always have the hedge against increasing energy costs. So I think with all of that, you're starting to see large, 60 megawatt plants start to go to a megawatt, two megawatt in hospitals, malls, and start to enjoy the benefits of a microgrid.

Jason Price: 

Okay, well since our audience is from the utilities, describe the relationship and interaction of your work developing microgrids with the utilities.

Bruce Schadler:  

Interactions with utilities, I would say is kind of a love hate relationship. The first step in any microgrid development is to meet with the utility to understand their policies, rate structures, interconnection requirements, what goes along with full mitigation, and sometimes franchise agreements, because in some districts or utilities, they allow you to go cross one public street, so you could potentially tap an owner or prospective client on the other side of the road. Some, it's only adjacent property, so you got to really understand their policy towards it and the franchise agreements as you're developing these microgrids. But usually you meet with the utilities during a feasibility stage to review the project requirements and a customer's goals, and to make sure we have a path forward.

Bruce Schadler: 

I think it's also important to understand that you need to have the utilities to have buy into what you're trying to do with the microgrid, in order to have a good successful project. Early on in my career, William Floyd School District being one of my first projects that I worked on, we had a difficult time out there working with the utility. We used to call the utilities cogen killers, or nowadays microgrid killers because their requirements would be very strict, which leads to extra equipment needed, increased capital costs, which unless you had stellar financials really, really destroyed it. And I think they would come out and say that they supported CHP and such, but I think in the end they were just looking to increase their revenue. I think nowadays there's definitely been a change in policy and understanding towards interconnections and microgrids and their advantages.

Jason Price: 

Okay. But are utilities getting into the microgrid development business? Are you seeing utilities buying finished projects? Are they competitors to you when they develop, or how do you position that?

Bruce Schadler: 

I think that's a great question, and I think... We've worked with several utilities, one in Southeast Canada in developing microgrids, that they were interested in purchasing. Reason for it, there was a lot of large scale and consumers in industrial steel mills, carbon black mills that really large loads, 10 megawatt, 15 megawatt. They don't have the distribution, as you can imagine, where they can deliver the power that that's needed. So they understand that if they can come out and develop a microgrid for them, they'll have this customer. And I think with the advent of all these indoor grow farms that you see popping up, because there's really a large demand for power, utility understands that it would be astronomical to develop the infrastructure to get the power to them, but rather a microgrid, a local microgrid, as a solution.

Bruce Schadler: 

We've also done some work with the Puerto Rico power authority, took some meetings with them, again around distribution issues. After Maria came through, Puerto Rico, as I'm sure everyone knows, there's some parts of the island didn't have power for up to nine months. They were looking at how we look at the specifications, the requirements, how we interconnect. I think in a nutshell, what they were looking for was, was there a way to have their large end users, whether they're some type of manufacturing and stuff, but have their own generation where if they had an actual disaster, they could segregate parts of the grid and have these distributed generation backfeed out into the grid and pick up the local towns and villages, if you will, around the manufacturing plants. So to answer your question, yeah, I do see a utility getting involved in developing microgrids, not as a competitor, but as a partner.

Jason Price: 

I know you've also mentioned that microgrids can be integral to recovery during natural disasters. Can you explain for us the role they can play in those situations?

Bruce Schadler: 

Sure. I think a great example I always throw out there when we're talking on this topic is NYU Square down in lower Manhattan. During Superstorm Sandy, most of lower Manhattan was shut down by the utility Con Ed. One, for protection and two, because most of it was underwater at that point. There's a great picture out there of Manhattan taken 30,000 feet up or so or whatever, and you see this little square of light in lower Manhattan, and that was NYU Square, because they had their own microgrid cogen at that point, and they were able to keep the lights on and keep the facilities running.

Bruce Schadler: 

So I think that's a great example of how beneficial a microgrid can be, where during normal times you can share power with the utility, but in the event of a natural disaster where the utility has to shut down, you can potentially run your plant and keep operations going. Natural disasters, I mean, they definitely spur other microgrids, the Air and Space Museum at the Intrepid, they put in a microgrid as a result of Superstorm Sandy, as did Hudson Yards took inspiration from that when considering putting in a microgrid and building their development now. So I think you can definitely see how natural disasters definitely influenced microgrids and how they can play a role in those situations.

Jason Price: 

Terrific. All right, let's talk concrete examples. You've implemented some state-of-the-art microgrid technology at the Hudson Yards development complex. So walk us through that project. What was the initial problem to be solved? How did you scope out the solution? And what were the ultimate outcomes?

Bruce Schadler: 

Yeah, just to give you a little background on the Hudson Yards development, it's located on the west side of Midtown Manhattan, and it acts like a small city in itself with multiple buildings of mixed use, which is rental, residential, office, etc. The design is it's a 13 megawatt microgrid and it's situated on the roof of the mall, the retail mall there. I think after Superstorm Sandy hit New York City, I think there was a huge movement towards resiliency. I think that was a big motivating factor for related and the Hudson Yards development to move forward with it. I think it was a positive selling point for future tenants. And I think it made economic sense if we could pick up the whole campus.

Bruce Schadler: 

And that's where the challenge came in, was how do we pick up the entire campus, putting in distribution and connecting without driving up the cost too much to make this uneconomical? And a strategy we came up with was interconnecting to utility, but in utility feeders. So this was kind of unusual and the first of its kind in New York City, where we're actually going to put breakers into the utility distribution. I mean, usually, when you do connections, it's on the house side of the utility meter. This was on the utility side of the meter. So we really had to work with Con Ed and their policy to come up with a specification that we could all agree upon to make this happen.

Jason Price: 

So what are the financial implications of all this loss load to Con Ed? Who's the local provider? Who is winning and losing in this equation?

Bruce Schadler: 

I view it as a win-win. I think that the customer receives the reliability that they're looking for and the economic savings. I think that the utility benefits from having that load freed up from the grid. And it also demonstrates that the utility is open to change and new solutions when looking to install microgrids. So I think that goes a long way with public favor. In other situations, the microgrid can provide power to the grid as I was discussing earlier, and that will also reduce operating costs to the owner.

Jason Price: 

Bruce, I've toured the Hudson Yards microgrid, and it's an impressive structure. And we know that the underpinning value of the microgrid at Hudson Yards was its resiliency, as you pointed out. How do you measure, how do you value resiliency?

Bruce Schadler: 

I think it's tough to value resiliency unless it's measurable in dollars, of course. For something like Hudson Yards, the resiliency would come through in leases and rentals and tenants, getting valuable tenants to sign onto the leases. I think you take a look a away from Hudson Yards and you look at other industries that we work with, sometimes they measure resiliency in the fact of if their process is down, what does that cost them? We've done work with Johnson and Johnson, and if they lose power for more than two minutes, they have to go through a whole cleaning process. And being down for a day was worth $4 million to them. So I think you can put a price tag and resiliency if it can be measured.

Jason Price: 

Perfect. When it comes to microgrid technologies, do the projects you implement have any, say, special sauce? What does your platform offer that's really elevating these solutions to the next level?

Bruce Schadler: 

I would say as far as technologies go, we evaluate everything based on what our customer's goals are. We're impartial to technologies, and we don't rep or push any one type of technology. And I do think customers appreciate that. I'd say the special sauce that we have is our model and performance. It's the tool which we use to evaluate all our opportunities, and it has the ability to evaluate different technologies at the same time.

Jason Price: 

So tell me, once you stand up a microgrid, do you also get into the rate design?

Bruce Schadler: 

Yes, I think depending on the situation, Veolia has a group that advises on rates and commodity. We advise on rates structure to the people that take power off of the microgrid. Sometimes it's a simple PPA, a power purchase agreement, where it's just based on a discount against the utility rate. Other times it gets a little bit more complicated, where we consider capacity, commodity and transfer and distribution charges. I know at Hudson Yards, they had several different rates down there just based on how many clients they had, and they had a tier structure to sign up for backup different levels. So depending on what tier you signed up for, you had a different rate. So we did advise on that at Hudson Yards, and we also do a lot of negotiating with the utilities for rates on the utility side, just not on the power purchase side.

Bruce Schadler: 

Since these are very unique projects, when we approach the utility, sometimes they have needs and they're willing to negotiate with us. Sometimes it can be being able to export on a particular rate that you're not normally, or we definitely negotiated reducing standby capacity charges, which is what happens when you have distributed generation connected to the grid. And even at Hudson Yards, I believe we did the buyback rate, so it was neutral for us to push power back out to the grid. So the grid could capitalize on getting power injected into the grid, and at the same time, at Hudson Yards we could run the engines at 100% efficiency, giving us a better Performa. So that that's how we work with the rates around a micro-grid or cogen.

Jason Price: 

Understood. Bruce, share with us what the past year has been like. What's it been like regarding the adoption of microgrids and just generally speaking what you've seen in the marketplace this past year, given COVID and the economy.

Bruce Schadler: 

To be honest, I haven't really seen any slowdown in interest on microgrids, even given the recent pandemic and economic slowdown. I think we've started to see more studies than ever looking at microgrids. I think there's a financial savings as a driver for these, and I think with the corporate initiatives that are coming out to go green and reduce carbon footprint, as well as the government policy now on greener energy, I think all of that has been shifting momentum into microgrids. Just based on that, I think microgrid will start to come into their own.

Jason Price: 

Bruce, tell us how this microgrid offering fits within Veolia's Hubgrade platform for digital innovations and solutions.

Bruce Schadler: 

I think microgrids are one of the technical solutions that Veolia offers under our Hubgrade service. The service is kind of an umbrella type concept for digital innovation. It offers greater sustainability, energy efficiency through real time energy management. Hubgrade, it's a way for us to basically help customers improve their performance, whether it's a building microgrid or otherwise. Ways I've used it and what we're trying to work it into with microgrids is I make buy type analysis where we use the RTEM, the real-time energy management, and we look at several factors for the operating efficiency of the plant, cost of production at that moment, what's the real power cost from the utility? And we can basically decide time of day if it makes sense to run the microgrid, or if it makes sense to import power from the utility. So we're using Hubgrade in that way with microgrids for the customer to improve their overall performance and their financials.

Jason Price: 

Got you. Now let's look forward. What's the future of microgrids and how are you and your team working to make the future reality?

Bruce Schadler: 

The future of microgrids is interesting, because I think you have to look at the microgrid with the macrogrid, if you will. What I see in the future is microgrids interacting with the macrogrid to provide power in spot networks where needed, and what it'll do, it'll help offset some of the capital costs to upgrade aging infrastructure and distribution throughout the utilities grid. So you have these microgrids that will produce locally to the communities that's needed. I think a good example of this is a project we just did out in Brooklyn, Kings Plaza Mall, where we connected to the grid and they had excess capacity, as I was describing early on. And what they do during the demand days is they export six megawatts of excess spinning reserve they have to the local community, and it's able to keep the lights on there were in the past they've had to have brownouts and such. So I see the future of microgrids acting that way. Maybe it's a little bit more integrated with the utility, but I can see that definitely being the future.

Jason Price: 

Very nice. So Bruce, this has been a terrific conversation and we really appreciate you letting us pick your brain on everything that's microgrids. You'll have to check back into the Energy Central community platform to continue to update us on the state of the industry and the fascinating projects you continue to put into the world. Thank you so much for joining us today.

Bruce Schadler: 

Thanks for having me. It's a pleasure talking.

Jason Price: 

You can always reach Bruce through the Energy Central platform where he welcomes your questions and comments. And on behalf of the entire Energy Central team, thanks to everyone listening today. Once again, I'm Jason Price. The most relevant conversations of the utility industry today are happening in the Energy Central community, so we look forward to you joining us and sharing your insight energycentral.com, and we'll see you next time on the Energy Central Power Perspectives Podcast.

 


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