Stabilizing the Grid and Reducing Utility Bills Through Price-Responsive Controls for Heat Pump Water Heaters

The electricity grid is facing increasing challenges in cost-effectively balancing supply and demand. These challenges are exacerbated by increased penetration of photovoltaics, which causes mid-day overproduction, and electrification of gas appliances, which increases peak-period electricity demand. Decarbonization requires shifting building loads from fossil-intensive high-cost times to renewable-intensive low-cost times while maintaining quality of service to occupants. Utilities and ISO’s are investigating new ways of incentivizing this load shifting. One promising method is the use of Highly Dynamic Prices (HDPs). HDPs feature continuously changing prices that reflect real-time grid generation and distribution costs and capacity constraints, and thus incentivize consumers to shift their loads. California’s CPUC CalFUSE proposal and Hawaii’s recent changes demonstrate that electricity tariffs are moving towards this model. For this to work however, loads must have the capability to respond to these prices. Heat pump water heaters (HPWHs) are an ideal device for this purpose because their storage tanks decouple delivery of domestic hot water from electricity consumption. The storage enables control strategies that consume midday solar power to increase the energy stored in the tank, then provide evening peak domestic hot water services using the stored energy.

Berkeley Lab's CalFlexHub project is pioneering price-driven load flexibility by developing and deploying cost-minimizing controls for many flexible loads - including HPWHs - in response to HDP. Control development is based on simulations using the Flexible Heat Pump Water Heater Performance Predictor which captures the control decisions of the on-board controller in a residential, integrated HPWH . The price-responsive controls a) shift load in ways that consume additional midday solar power to help stabilize the grid and reduce overall emissions, b) ensure that occupants receive equal or better hot water delivery service, and c) minimize the operating cost for each home in the fleet. On the grid level, the resulting shift will reduce utility operating costs and emissions, and can avoid expensive system capacity expansions. The control approach is customized to each home based on typical hot water consumption patterns. HPWH controllers, whether on the device or remotely, will receive a schedule of CTA-2045-B signals or set temperature adjustments customized to the current HDP price schedule and home. Simulation results for a fleet of 148 HPWHs on a summer day in Berkeley, California show cost savings of 29% and high price electricity consumption reductions of 80%, while maintaining full quality of service.