The Value Idling in Electric Vehicles — Episode 182 of Local Energy Rules

Podcast: Local Energy Rules
Source: whisper-base
Language: en
Duration: 2699s
URL: https://media.blubrry.com/localenergyrules/content.blubrry.com/localenergyrules/2023-4-ler182-callnan-transactive-rate-vehicles.mp3
Fetched: 2026-03-03 04:13:29

The transactive energy rate came about because back in 2017 our board of directors got together and they developed a strategic plan, recognizing that the members will want to use the system in a different way going forward. In order to do that, they felt that the members would want to transact with the utility in different ways. So more of a bidirectional conversation rather than a single direction of just delivering power to people's homes. A long-run barrier to expanding renewable energy has been operational. How can utilities operate a reliable electric system when depending on the wind and sun? Fortunately, under the hoods of America's electric cars we can find nearly as much energy capacity as all of the grid-connected batteries combined. In this episode, recorded in January 2023, Brian Coleman, Vice President of Power Resources and Access at the New Hampshire Electric Cooperative, explored the cooperative's new transactive energy rate that sets up the hardware, the software, and the pricing to let cooperative members provide energy back to the utility's grid. Their early model suggested that an electric car owners $4,000 per year for sharing their batteries with the cooperative's grid system, enough to make the concept very compelling. I'm John Ferrell, Director of the Energy Democracy Initiative at the Institute for Local Self-Reliance, and this is Local Energy Rules, a podcast about monopoly power, energy democracy, and how communities can take charge to transform the energy system. Brian, welcome to the podcast. Thanks, John. Thanks for having me. So I was hoping to just start out by asking you a little bit about your background, how does one become the Vice President of Power Resources and Access at an electric cooperative? What is your career arc or has gotten you at this point of being interested in and working on supporting electricity services at an electric cooperative? Well, I mean, that kind of goes from where I started. So I started back in 2003. I've been in public power ever since. When you think about a cooperative, though you can say consumer owned, but very similar kind of set up for the corporation. I've been focused on how wholesale markets work. So the VP of Power Resources and Access, which is what I'm doing here at the co-op, kind of means that we're in charge of all of the electricity that flows on those distribution lines that you see on the side of the road. Most of the company is making sure that those lines are reliable, resilient, and that they can effectively and efficiently bring power to everybody often as they want it, which is all the time. I don't get to play with that very much. I just get to try to keep the cost as low as possible for what's flowing through those lines for our numbers. And I've been doing that for about 20 years. So 2003, I went from a company in Vermont, Burlington Electric, and then I moved to a joint action agency in Central Vermont, held Vermont Public Power Supply Authority, and all kinds of working on the same type of work. That's great. I'm glad you have some history there at Burlington. I interviewed their mayor and their general manager a couple years ago about their renewable electricity goals, and sort of how they were thinking about now the transition from the electric supply, which they mostly get from renewable resources to electric vehicles and buildings, so kind of brings us to what we're going to talk about today. So as I mentioned in the intro, there is this dream, I think, among a lot of folks in the advocacy community around clean energy, the techno nerds who love the idea of managing electricity yourself that our cars, our electric vehicles will be able to somehow interface with the grid, and in a way that can both make people money, make the grid more reliable. So could you talk about this new opportunity that you have for the member owners of the New Hampshire Electric Cooperative to use their electric vehicle to support you and the work that you're doing at the co-op? Yeah, thanks, Sean. I'd like to back up a little bit. So I'll tell you a little bit what the rate is called, and that's important because it tells you why the rate was developed. So the rate, we're calling it a transactive energy rate, and there's folks out there that when you think of the term transactive energy, all kinds of things come into mind, but we had a very specific kind of definition that we wanted to focus on, and that's really just transacting with the members in a different way. The transactive energy rate came about because back in 2017, our Board of Directors got together and they developed a strategic plan with four focus areas. And one of those focus areas was recognizing that the members will want to use the system in a different way going forward. In order to do that, they felt that the members would want to transact with the utility in different ways. So more of a bidirectional conversation, rather than a single direction of just delivering power to people's homes, and the business model that was focused on was a transactive energy business model. And we came up with the transactive energy rate when we define that the best way to come up with a transactive energy business model that people could relate to was to use pricing signals. So if you want to transact, you would respond to a price, and that's where the rate came about. So back in 2017, when that was put together, we started to really kind of define what that looked like. It took us a couple of years to figure that out. And then in 2019, 2020, we really started to focus on defining what those pricing signals were. And we highlighted a basically 100% avoided cost rate. So the utility stacks up all of its costs and puts them into every single hour of the year. And shows that price to the member. And if you know the feral family sees that you're a member of the co up and you see that price and you have a device that can respond to that price to take advantage of it, then the co up will record that information, record that usage. And collect it for you over the period of a month, which is the bill, and then return it to you on your bill with a single line on. I stated a lot there, John. There might be some questions you had in there, but hopefully that was clear. Yeah, this is great. So one question I have is, what's the technology that makes this work? Do you have metering that allows you to then figure out what the customer is using every hour? Did you have to do what I guess some people generic like all smart meters or advanced metering infrastructure? Was there a new hardware that wasn't required in order to do this? Or did you already have the hardware you needed in place? That was a tough nut. It was hard to figure this out so that the technology to pull everything together was the biggest lift for us. We looked out there to see what was being used. And we settled upon an open source protocol. And that part was important. The source protocol called open ADR. That's kind of a demand response language that's open source. So anybody can go and download their libraries and start talking open ADR. And the reason we used that particular protocol was because it was open source. So we want to minimize as much as we could make it easy for other utilities to participate, which goes back to some of those cooperative principles, what we were talking about earlier. The individual devices that are on our system can communicate with an application that we put in the cloud through that protocol called open ADR. So let's if we use an example, let's use your car because we wanted to talk about vehicle to grid. Your car was on the system. It would respond and sent basically a file every day to our server. And that file has the usage of your vehicle, whether it was either using energy or discharging energy in the proper format. Our application would then send that usage information that we get every day. It sends us send it directly to our billing system. And more specifically, it sends it to our meter data management system. So it looks like a meter. And once it looks like a meter, we can do all kinds of things with it on our bill. So one of the unique aspects of this. And I don't know that this is going to be unique for all that long. California is allowing this as well. The meter itself is the car. So there's not a specific meter associated with it. So the car is talking to the internet and sending in files to our, we call it our T our application, but it's our cloud application and those look like meter reads. I'm super curious about this. In part, I think one of my interests in this quite frankly is that I have a 2015 Nissan leaf, which was listed as one of the few vehicles today that can do this. So I was just imagining in my house, I have a dumb electrical panel. I have an internet connected charger for my vehicle and then I have my car itself. And are you saying that I wouldn't need like if I just had this car plugged in anywhere on my house, basically, to charge that that's all the device I would need in terms of that. And I'm connected to your electrical system, obviously, or is there some other piece of hardware that I'm having to purchase that access that point of interface. So there's a step maybe that I went over or didn't explain ahead of that. So in order for let's stick with just the car part and then we'll talk about the Nissan leaf because there are options already today that work with the Nissan leaf. As you mentioned, it's one of the only cars that can do vehicle to grid. So we're working with a company called General Motors, most people have heard of them fairly big and they're using telematics to do that. So it's kind of over the air messaging. In order for a Chevy vehicle to participate, so we're about to do testing. I don't want to say that we have the testing done yet with Chevy bolts and Chevy volts. And this is for minutes charging first and then we'll move with the Silverado to vehicle to grid in the third quarter. So is the goal, which General Motors has done as they've integrated with us in our TER application. So what that means is they they have tested already with us. Can they send us these open ADR reports? And we've been successful there. So the important part in that arrangement is the cooperative isn't telling the car to do anything. General Motors is so General Motors is reading the prices every day pulling it into their application. And sending a charging schedule down to all those GM bolts that have signed up. And General Motors has signed those up for the benefit of our members. So they would have contacted the members and said, hey, there's this great program at the co up. If you want to help get your your charging cost down, we think we can help you do that. Go ahead and sign up. And then once that happens, we now see that car because General Motors is now sending us the reports. We see that car. We know who that car belongs to because it's been associated with one of the accounts in our system and then can go directly to that members bill. I hope that gives you a path of how the data gets from the car to the we call it an aggregator. So General Motors would be the aggregator in this aspect. And then to the co ups systems. Another way to do that, there's this company called Firmata Energy. They've also integrated with us. They have a vehicle to grid by directional charger, which works with a Nissan leaf. So you can buy one of those and then sign up with Firmata Energy and say, hey, I want if you were in our service territory, I want you to go ahead and maximize or optimize my benefit. I'm using the rate that the co up is providing. And then they would they would send instead to the car in that aspect, they're going to send it to their charger. Their charger will say whether to charge or discharge that vehicle. So those are two different ways to do the same thing, but they both get you a similar result. I'm sad to hear that you mentioned one criteria to participate, which is that you have to be in the New Hampshire Electric Service Territory because I had a small hope that there was a way for me from Minnesota participating, but I suppose that's not terribly practical. Well, do you have a cooperative that's close by to you? Have them give us a call. All right, much of what we set up is fairly transferable because we all use a similar billing system. In Minneapolis resident, I am served by the investor and utility excel energy. So I think unfortunately the opportunities for cooperation there are a little bit low. But we'll move on because I want to ask you so many other questions about this. In the piece that I read from Energy News Network back in September of 2022, they were giving kind of an overview of your billing rate, the transactive energy price. And then you were working, I think it was with Plymouth University in New Hampshire was partnering with you to kind of give some estimate of what could the outcome be like for the owner of the car for the for the member. And they estimated they could make as much as $4,000 a year participating this. Now they did say and the articles as well that they were really only using these vehicles for like short distance trips. So one of my questions was like how much charging or discharging is required to participate? I mean, is it totally up to the person who owns the car? Could the battery actually end up being emptied if you wanted to do that? How does that work? We are very fortunate to have a university in our service territory. They're actually right by our headquarters. The name of the university is Columbia State University. And they were really excited to help us test this this rate. And so they've been actively on the transactive energy rates since July of 2022. And that allowed us to get some kinks out. So it's been super helpful. That is two Nissan Leafs. They wrapped it up with some great graphics. So they had some marketing folks within the university participate. I think some business students did like a business plan on it and some of the technology because it's new technology there. So it just fits really well with a university at learning institution to see where things are moving. So they were excited to do this with us and we're super grateful that they've been helping us. So since July, we have been seeing how that car will charge and discharge based on the signals that we're sending every day. And in that example, that's using the Firmata Energy Charger. So Firmata Energy is actually giving the commands to the charger. And if the car is plugged in, then it'll follow those commands. If it's not plugged in, then it obviously can't because there's nothing telling it what to do. But what's nice about that is that the state doesn't have to make those decisions on a day to day basis. They're not waking up every day having their cup of coffee and trying to figure out what they should do with their car. Most people buy cars to transport themselves, not necessarily to take advantage of a transactive energy rate. So we've been able to test out what does that value look like because everything was theory before. And what we did is we backcast, you know, hey, what if we were running this rate back in 2018 all the way up through 2022, what would it look like? And when we did that, we came up with some averages and we said, well, if you were trying to optimize value, you could see up to $4,000 a year for each car. That's per car. That is a lot of value. I mean, that really changes the way a family would think about a car. You know, your car is getting you from A to B that does that very, very well. What cars don't usually do is keep money in your pocket all that well, right? There's all kinds of things associated with cost when it comes to a car, which is fair. It's doing transportation, but you've got fuel costs, you've got insurance costs, you've got to pay for the car itself. You got a budget for maintenance. So there's a lot of expenses that are associated with that. If there's an opportunity to provide needed services to your local distribution cooperative, and you can pay for those services with their worth, you're now taking a vehicle that you've invest, which is a big investment separate of a second to probably your home is your biggest investment, maybe your education. Now you're adding some benefit to that monthly budget for that family. So we were kind of excited about that because that seemed like that's going to really provide a new benefit to our members. So when we backcast that, that was all theory and we were able to test it since July, and those numbers are proving out to be about right. I mean, we had, I think in the first 45 days, we were able to see a little over $850, I think, of benefit by discharging at the right times. And one of the questions I think you were kind of alluding to, John, is that it's like, well, I mean, that's all well good, but you do want to, you do want to take a trip to the sea coast once in a while, or you want to go somewhere with that car. You don't want to necessarily just be waiting around for the right time to charge or discharge the transactive energy rate or the day ahead rate that we're putting out there for our members. There's, I don't know, I'd say around 300 hours per year that you're going to see some dramatic price increases. And when you see those price increases, you either want to do one or two things either want to discharge your car or you want to not charge your car because then you can save from those high priced hours. I mean, there's 8,760 hours in a year. I didn't do the math, but I think we're around two to 1,5% or so of that is about how much time that you would be using. Usually those hours are in the evening, just about when you get home. If you were working on a nine to five shift, when you get home, there might be a time to go ahead and discharge your car. No, when it comes to, if I discharge my car, well, I feel but go anywhere. The way it's been explained to me so that this is not what the co-op is doing. You know, this is what the auto manufacturers would do. They will say, hey, there are a user parameters for everybody's vehicle. So for the federal family, you might say, look, I always want to have enough mileage to get to the hospital and back. So if you want to make sure you can get and say you're, you're not in anyapolis, but you're not in the outskirts of that and it takes you 15 miles to get there. So you always want to leave 30 miles in your car, no matter what. And then you might also have other restrictions on that saying, I need to be at work by eight o'clock. I want to make sure that I always have another 20 miles or something in the car at eight o'clock every day. So now you, you've added another restriction on what you can do with charging and discharging of that car so that you know a 50 miles at seven o'clock, because you got to get there right so 730. So you, the whoever is going to be your aggregator will say it's general motors or maybe it's from ought to energy is looking on it. They will make sure that the status of your battery will always allow you to meet those parameters that you've put in there. So you never left without enough energy to what you have stated you always want to have. We're going to take a short break when we come back, we discuss whether car companies are becoming energy companies. We get into some details about the components of the transactive price and we hear how the New Hampshire Electric Cooperative is eager to share their system with others. You're listening to a local energy rules podcast with Brian Cullen, vice president of power resources and access at the New Hampshire Electric Cooperative. Hey, thanks for listening to local energy rules. If you've made it this far, you're obviously a fan and we could use your help for just two minutes. As you've probably noticed, we don't have any corporate sponsors or ads for any of our podcasts. The reason is that our mission at ILSR is to reinvigorate democracy by decentralizing economic power. Instead, we rely on you, our listeners. Your donations not only underwrite this podcast, but also help us produce all of the research and resources that we make available on our website. And all of the technical assistance we provide to grassroots organizations. Every year, ILSR's small staff helps hundreds of communities challenge monopoly power directly and rebuild their local economies. So please take a minute and go to ILSR.org and click on the donate button. And if making a donation isn't something you can do, please consider helping us in other ways. You can help other folks find this podcast by telling them about it or by giving it a review on iTunes, Stitcher, or wherever you get your podcasts. The more ratings from listeners like you, the more folks can find this podcast and ILSR's other podcasts, community broadband bits, and building local power. Thanks again for listening. Now, back to the program. I am so fascinated this and I can want to ask you sort of a broader question. I sometimes recently I was talking to someone about the transition to electric vehicles and how auto manufacturers are investing billions of dollars in manufacturing vehicles that are powered by batteries instead of gasoline. And somebody mentioned this idea that has really lodged in my head about how they are really not just investing in a new technology to drive the car. They are basically entering another industry like GM as an aggregator is now like a virtual power plant owner essentially. And well, two thoughts about that. One, does that seem like that rings true for you about the role that auto manufacturers might play? And the second question I have is with this transactive energy rate or to the degree to which we have them, is there something in it for the auto manufacturer? Like, are they going to get a cut? Is there going to be a contract they sign with the co-op that rewards them in some way? Is there a business model, I guess, for them to be doing this for their customers or will it be sort of baked into the price of the car or something like that? I guess it seems so fascinating that this is one of those I think really interesting like on the boundaries of your business all of a sudden there's a whole opportunity opening up here. Are they energy providers? Is that seem about right? And I would say most, most definitely, right? If you think about, you talked earlier about the amount of energy that's stored in vehicles based on the projections of EV sales moving forward being pretty substantial, right? I have this quote that I use that's from Volkswagen and it just states that between 2025 and 2030 they will have one tarot hours worth of storage in their vehicles. And that's just one auto manufacturer that's not all of them. And based on what this gentleman said that he said that it's more energy than it's currently generated by all the hydroelectric power stations in the world. And that's a pretty all statement, right? So I looked into that and it's not quite that is what I looked at it. And I think you want to have you out that by saying as much energy that's almost generated by hydroelectric power stations in the world for one hour. But the whole the four one hour part is important. Very much so I'm very familiar with the capacity versus energy conversation that will no doubt light up my inbox if we didn't clarify. Yeah, but it's just I think it does highlight really well that there's just it's just saying there's a lot of energy out there. And if you think about how you're using a vehicle, you're probably only in your car 5% of the time, you know, it's just basically sitting most of the time. Most folks will drive a drive their car to their place of business, park it in a parking lot, pick it back up at the end of the day, drive at home and then park it in their garage or park it in their driveway and out of the full day 24 hours, you've used it maybe an hour. So you're not using that vehicle all that often and you've got all of this kind of potential energy stored in that battery that could be doing something if it was connected. I think the auto manufacturers are fully aware of that and there's no reason to have a large paperweight sitting there that has all this extra stuff that it could do if it can provide value to the owner. There are ways, and I can say that we have the only way to do it. There's lots of other ways to do it, but I think we have a way that can help provide that energy for anything that can provide stored energy so that could be a standalone battery or that could just be shifting your overall loads in your house. But from the cars perspective, the auto manufacturers, their business model there is, you know, they're they're helping provide that asset, which is a very big purchase for a family provide new value new things to that family. Which may make them more interested in buying that particular car. So the auto manufacturers selling a car. That's their primary business and this is another revenue stream or another thing you can do with that asset that they can take advantage of and it might just be a tipping point for somebody. The other part to that is they're providing additional services for you. So when I talked about in order to take advantage of this rate, you really need to schedule your vehicle. Most families probably won't want to do that. I mean, if you think about trying to get the kids to school and get them on the bus, get them fed and make sure they got their backpack and everything's ready to go. That's a busy morning and you don't want to have your laptop open, also scheduling your car for the day. I'm stressed just hearing you mentioned that thinking about my school car pool and swim practice. So I appreciate you covering that. Yeah, it's a busy day, you know, so you can provide a service to the aggregator. In this case, the auto manufacturer to provide that service for you. And they're similar models. Now, there's, I think I can pick on GM again, they have an on-star service where that's if you push a button in your car, you can talk to somebody if you need something. And it's not, I think they're the monthly subscription that's associated with that. So in this way, the auto manufacturer can have an additional kind of touchpoint with that customer through this subscription of trying to optimize the value. For the families that thought their auto will be. I want to come back to the transactive energy price really quick. There is a part of me that really wants to go into the weeds with you about how you set the price and like wholesale versus distribution level costs and stuff because there's fascinating conversations across the industry by that. So maybe I'll come back to that. Maybe I'll start by just asking, is there a place where you have sort of published the components or whatever that are involved in that price if people want to look into that? And then I have my second question and I'll save it to you answer that one so I don't have to make you write down all my multi-part questions. But yeah, is there a place to find out more information about how you built that transactive energy price? In a way, there is a website that we have dedicated on our home page. You can get to it, right? It's about the different rates that we offer and it's called the transactive energy rate. It's not live now, so you can't find it, John, so I'm sorry about that. But we actually haven't gotten live with our rate and we're hoping to do that by the end of the first quarter of 2023. But it's all ready to go. So we've been prepping the thing. And in our terms and conditions, which is what someone signs when they decide to take a new rate that has a description of how that rate is calculated. So a member can look at it. But we don't know that most members will want to look at that, you know, to try to understand that because the rate will show you can just see what the price is. There's a spot where you can see the price every day. If you want to look at it, you can download historical prices. If you wanted to see what prices were in the past, so you can see whether this rate is right for you or not. We're trying to give as much information to the members so they can make a informed decision when they try to install a new device or sign up a new device on this rate. My next question flows right from that, which is sometimes when utilities do these rates like a time of use rate, I know for my utility for quite a while, the only way to get on a time of use rate for any device was to sign up your whole house for it. What are you saying device? So I was curious, would you could I just sign up my car for this, but then keep my home on your standard residential rate. I'm glad you asked that question because we went through a lot of pains to do this. So we wanted the federal family to be able to just sign up a device and not their whole home. When you think of time of use rates, you can think of beneficial rate or penalty rate, right? You can see you can see both sides of that coin. When those prices are quite high, you could view that as a penalty if you were using a lot of energy at that time. And the real benefit to this rate is for load that is flexible and controllable, not all the load in a home might be flexible or controllable, so you wouldn't be able to completely avoid those high costs if you had your whole home setup. And if you did, it would be very difficult to figure that out all out. I'm sure someone could, but I don't think any not most folks could turn their whole house house off for those couple hours. So we really wanted the ability of just using an individual device so that it was controllable for the member. I had this example that way I would use from a teenager. So if you went home, if you took off for the weekend and your teenagers had a great big party at your house and they were using all types of energy had happened to be one of those events, you had a poor experience because your whole house was on that. It's most likely if you had, even if you did go out for the weekend and your your teenagers had a big party at your house, they probably didn't go and. Change the schedule on your standalone battery or go and change the schedule on your vehicle that was in the garage. So you were still kind of held harmless from that right that activity that you couldn't control. You kind of think of the device as like a sub meter in the home, so all of the energy that's either used or discharged or produced from that device is backed out of the main meter. You call it reconstituted, but it's it's it's set up so that you're not paying twice for energy that's being used in the car and you're not getting double credit because you've discharged your car and you're also feeding into the grid at the same time. That part was not that easy. That's why I mentioned that John is that we wanted to make sure that the member that was using that device, the transactive energy rate was really just using it on that rate. There are other rate, which would be a flat rate. Yeah, it's fascinating to think I love your example, by the way, because of the implications. If you do have a teenager who has a party when you're a way that involves reprogramming your car's discharge schedule, then you have probably a different kind of problem or maybe maybe it's not a problem at all. Maybe it's a good sign of taking an interest in transactive energy. My last question about the rate that comes in from my experience dealing a lot with distributed solar and with net metering, which is people will talk about net metering. Let's just say that the conversation is very fraught between utilities and regulators and solar companies and solar customers about is this rate a good measure of the value of the energy that's being given to the grid. There's a lot of weeds about net metering alone about how often do you net and all that kind of stuff. One of the points of general agreement is that at some point net metering as a flat fixed rate to transact with the utility, if you will, for a solar project becomes less representative, the more solar projects are on the grid, especially if they're all configured in the same way. They're all like south facing and just trying to maximize kilowatt hour output. And so maybe that was a way longer setup than I needed for this question, but is that rate likely to change as more people participate and if so, how? In a perfect world, the answer would be yes to that. Because that's what you would want to have happen, right, is if you think about the way the rate is set up. And I didn't I didn't give you a lot of detail on the different components that are within that rate, but I'll give you a little bit of it. Just so it's not too in the weeds, but there's an energy component. There's a capacity component and there's a transmission component. And then there's a lot of other stuff that's in there too, but those particular units, one has kind of an energy or time based focus to it. And then the other one is more demand based, right, so a lot of energy being used at one time, one hour. And because of that, there are some particular hours during the month, we're doing a year that can get quite costly because that's how you're build on those components. So if you're trying to send a signal to folks and say, hey, pricing during these particular hours of the day are really high because the system is kind of stressed a little bit. There's a lot of energy being used on the distribution lines and the transmission lines. And if we could reduce the amount of energy that's going through those lines, it would be less costly and we can keep the system we have for much longer. So we don't have to build new lines, we don't have to build new substations or things like that. And so by sending that signal that during those particular hours, the costs are quite high. You would want to see folks start to use the energy at different periods of the day, like maybe when the costs were quite low, two in the morning or so, if they were able to do that. And that's good because now you're moving energy used to times of the day where there's no concerns on the stress of the system. There's plenty of capacity, the lines have plenty of room, you know, the pipes are only an eighth full, you know, instead of three quarters full. So you're shifting energy to those hours, which gives your system kind of long journey, you don't have to continue to build it out and build it out. So if you were to be able to do that perfectly, you would shift all those high cost hours over to those low cost hours and now you're serving the same amount of energy every hour of the day. And then if that was the case, then the prices would be the same every hour of the day because you're serving the same amount of energy and using the same system for that and everybody's super happy. But in reality, that just won't ever happen. So yes, you could start to see some equilibrium with the prices, but the systems are so big that the amount of energy that's being used in those high cost hours. And the next 20 to 50 years, if everybody was sending very strong price signals, we don't see that it's going to change it so those low cost hours don't become low cost hours anymore. It's hard for me to avoid the weeds because I've been involved in this kind of stuff. So I'm going to ask you one Weedy question that we're going to move on, which is when you talked about the system being strained. It's sometimes there can be a distinction between when the transmission system is constrained the ability to import or export energy from your region versus maybe just your local neighborhood where a bunch of people are running their pool pumps or something like that or other higher usage devices or might all be trying to push power back onto the grid at the same time with rooftop solar or something. Do you account for those two different levels of where the stress can be so far in the pricing or will you at some point. So we have a bucket for that. So when I was explaining before the different components of the energy price. You can kind of think of it as A plus B plus C plus D plus E, etc. Right. You just add those all up for that particular hour. So we do have a distribution component, which is a locational component within our distribution territory. But right now the value is zero. So let's just say that's F. So right now F is equal to zero. But we have that in there because there will be areas in our service territory where let's say the whole neighborhood puts in solar and then everybody puts in heat pumps and then the electric cars are there as well. So it's just they grow very quickly. So there would be a need to upgrade that system at that point and prior to that system being upgraded, we could send a signal within this rate, increasing the cost during those hours where the systems is getting strained locally. And that might help alleviate some of those concerns until we can get in there and start building up the system. Not a perfect solution, but it does help maybe extend a little bit of time before you have to do an upgrade. So we do have it in there. We just don't have it valued yet. One of the things that we have been talking about around this is we worked really, really hard to make this the application that we have out there in the cloud, the communications protocols that are there. And then also the connection to our billing system, we try to keep that all super easy. So if there's another cooperative that's out there, it's easier with cooperatives because we all kind of most of us use the same billing system. So this application is already connected to our billing system. But we really want to make sure that folks are aware that if they, hey, if you guys want to do something similar to this, you don't have to go near what we went through to pull it together. We can, we'll share it with you. I mean, I think that's cooperative number, principle number seven, right? You cooperate among cooperatives. And we want to do that and we kept things as open source as we possibly could. I mean, not everything can just be free, right? We had to develop some applications that they would have to modify on their own. So they'd have to hire somebody and make it work or do it internally. But for the most part, it's not that difficult. Like if you think about the client server relationship, the server is the TDR application, the client would be your device, right? But in order for that device to talk to it, you have to be, you have to have this thing called a virtual end node, which is open ADR speak, right? We created a van and we'll give it to people and say, hey, if you want to connect to our system, here's a van that you can use to do that. And in order to test to see if it would work, one of our employees took that van and attach it to their water heater. And was started to deliver meter reads, right? Quotes, meter reads to our application in a day. And they're not like some programming ways that they are technically adept, right? Because they're even trying to do this, right? So there's those types of people out there. But I wanted to just make sure that you were aware that we tried, we really worked hard to try to make it easily transferable. Perfect, thank you. I'll just ask you one last question then to wrap up, which is, why is it taking so long to do this to provide transactive energy rates and to allow people to discharge energy from their electric vehicles back to the grid? I feel like I've been reading about it for years. Now, I'm obviously an outlier in terms of my being in tune with the news about this. Probably even before I bought my car, electric car, which would have been at least five or six years ago. I'd been hearing that this was possible that people were testing the concept. What were two or three things that really had to be solved to make this possible? We talked with ComEd quite a bit on Chicago, to see, in Illinois, they've been doing real time pricing for quite some time. So our biggest hurdle really was the fact that the rate would change every hour. That was, I'm not going to say the biggest hurdle, but that was a significant one is how do we deal with an hourly rate? And we saw that Illinois, I was been doing this for quite some time. So we took a lot of hope in there that we could actually figure it out too. So we asked them quite a few questions about how they did it and what were some of the benefits. And they've seen quite a few benefits for their customers for folks that have moved to kind of more of a real time pricing component versus a day head pricing. It's just one day difference, right? Well, that's out there. And I think that's been in place for multiple years now. I think four or five years maybe. I have seen stories as well as electric buses as more electric buses are coming into the system. There are some demonstration projects that are out there for helping to use those buses for vehicle to grin. And we've talked with some companies about that as well. There are having some projects that are around the country that they're doing. An electric school bus is a great example, right? It's a much bigger battery and it's used at a finite amount of time every day. So it's very scheduled goal and sometimes in the summer when you have capacity concerns. There's hopefully no school going on depending where you are. And you can use those buses for rather than transportation. You can use them to help provide services to the grid. So I think there are some examples out there that projects like these are starting to take off. Well, Brian, thank you so much for taking the time to talk me through the work that you're doing at the New Hampshire electric cooperative. And to give us the vision of transactive energy and how might actually work. It's exciting to hear that you're planning to launch this later this year. And it's definitely something I will be following and that many people working in this space will be watching as well. Oh, thanks. I understand I'm glad that you can give us an opportunity. We're trying to make sure that our members are fully aware we're using all of our channels. Thank you so much for listening to this episode of local energy rules with Brian Coleman vice president of power resources and access at the New Hampshire electric cooperative. About a new way for utility customers to transact with utility using their cars or other devices. On the show page, look for links to coverage of this project by New Hampshire public radio and the energy news network. As well as a presentation about the transactive energy rate. We'll also link to previous local energy rules podcast interviews, including the one I mentioned with leaders from Berlin to Vermont. About their 100% renewable electricity goal and their shift of thinking about buildings at cars. As well as my interview with Kauai Island utility cooperative CEO David Bissell, which covers the operational challenges of running a grid on mostly solar power. Local energy rules is produced by myself and Maria McCoy, with editing provided by audio engineer, Drew Verschbach. Tune back in to local energy rules every two weeks to hear how we can take on concentrated power to transform the energy system. Until next time, keep your energy local and thanks for listening. Thanks for watching.