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What Is Transactive Energy?

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Over the past two years, the GridWise® Architecture Council has been developing a body of knowledge aimed at addressing one of the major challenges to the electrical system. Traditionally, power system operations have been centrally managed with a focus on maintaining adequate capacity, power and reliability through bulk power markets and wholesale generation and transmission centralized operations. Distribution and retail operations have generally been based on a one-way supply model with little or no operational or market-based mechanisms for adjusting the demand side of the system. This structure is inadequate for future high penetrations of intermittent renewable and distributed energy resources (DER) integrated conventionally or through micro-grids. Distributed and hierarchical controls, services and pricing methods spanning bulk power and distribution system operations, retail markets with coordinated reliability and economic objectives, are needed to enable the 21st century power system.

How We Define Transactive Energy

A number of research and development efforts related to Transactive Energy architecture, market designs, systems, services, pricing and standards are underway by universities, national labs, utilities and technology firms across the world. The term “transactive energy” is used here to refer to techniques for managing the generation, consumption or flow of electric power within an electric power system through the use of economic or market-based constructs while considering grid reliability constraints. The term “transactive” comes from considering that decisions are made based on a value. These decisions may be analogous to, or literally, economic transactions.

Transactive Energy has become a convenient “bucket” for collecting together the various disparate efforts aimed at solving the architectural and policy challenges we are currently facing. Indeed, the very descriptions that have been used for “Smart Grid” turn out to describe what we are calling “Transactive Energy”. Think of Transactive Energy as simply the theory and practice of implementing some of the key concepts of the smart grid.

QualityLogic Works on Leading Implementation of Transactive Energy

Why does a company that builds test tools care about something like Transactive Energy? The answer is simply that QualityLogic’s business strategy is to provide the best development test tools to the industry for implementing emerging smart grid standards, and we are working on a leading implementation of Transactive Energy, called Transactive Control, in the Pacific Northwest Regional Demonstration Project. In our business of developing test tools, we engage with the technical community defining a standard in order to improve not only the standard itself, but the efficiency of implementing products based on the standard. The better we understand the business value and use of a standard, the specification and the intent of the implementations, the better our development test tools meet the needs of the industry.

We see Transactive Energy implementations and emerging standards like Transactive Control as the future of the electrical control system and are committed to providing the industry the tools it needs to create interoperable products.

For those interested in learning more about Transactive Energy, see the GWAC proceedings referenced and also consider attending the upcoming First International Transactive Energy Conference and Workshop, May 23-24 in Portland, Oregon. The goal of the conference and workshop is to bring together organizations and researchers that have been researching, developing and deploying Transactive Energy techniques and business models. This forum is intended to facilitate development of a Transactive Energy Framework design initiated by GridWise Architecture Council to enable accelerated adoption of Transactive Energy policy and technologies policy worldwide.

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