Canadian Consulting Engineer

Commercial Buildings and the Smart Grid

March 1, 2012
By By Meli Stylianou, M.Eng., CanmetENERGY, Natural Resources Canada

Utilities used to see buildings simply as loads on the grid. That relationship with the electrical distribution network, however, is rapidly changing. Increasingly, commercial, institutional and residential buildings are being used in Canada...

Utilities used to see buildings simply as loads on the grid. That relationship with the electrical distribution network, however, is rapidly changing. Increasingly, commercial, institutional and residential buildings are being used in Canada and the U.S. as a means to meet electrical demand peaks during emergencies — periods during which the electrical network is reaching its limits such as during very hot summer afternoons.

The relationship between buildings and the electrical power network is a significant component of what is coming to be called the “Smart Grid.” The Canadian Electricity Association describes the Smart Grid as an “automated, widely distributed energy delivery network, characterized by a two-way flow of electricity and information” (CEA, 2010).

In the case of buildings, this two-way connection to the Smart Grid is essentially achieved through Demand Response (DR) events. Typically, buildings receive dynamic price signals or other incentives from the utility or electricity aggregators and react by modifying their operation to respond to these signals in a timely manner. Whereas interruptible load programs that ask industrial plants to limit their electrical demand have been around for many years, programs that employ buildings in demand response events have only recently been put in place.

In Canada, the Demand Response 3 (DR3) program, developed by the Ontario Power Authority provides economic incentives for participants to reduce consumption during specific time periods. This is a contract-based program, with participants required to reduce electricity use when called upon.  In exchange for a commitment to reduce their load, participants receive an availability payment. They also receive a utilization payment that kicks in when an actual, measured and verified load reduction below a predetermined baseline is achieved.

A number of ways are available to send activation signals for DR events, but whatever the means, the building reacts to the signal either through the manual intervention of building operators, or automatically through its building automation system. Control sequences are then activated that reduce the building’s energy consumption to a predetermined level with as little impact on the occupants as possible (see graph).

The ability of the building to react to the signal is highly dependent on what electro-mechanical systems have been installed and the ability of the control system to modify the operation of these systems in order to reduce their demand (Stylianou, 2011).

A demonstration of a fully automated approach to demand response during the summer months of 2010 was undertaken by CanmetENERGY at the Bell Trinity Square building in downtown Toronto. This building is equipped with a number of air handling units, four centrifugal chillers and chilled water storage of 1,000,000 gallons in the basement.

Since the building operators and controls contractor had a thorough knowledge of the building, they were able to choose and implement an alternative series of control strategies that were activated automatically when a (simulated) demand response event signal was received by the building’s automation system.

These alternative sequences included:

• turn off common area lights;

• turn off common area fans;

• raise temperature set point to 77 degrees Fahrenheit on variable air volume terminal boxes on tenant floors;

• reduce static pressure set point to 0.5 inches on fresh air fans;

• reduce static pressure set point to 0.5 inches on compartment fans on all tenant floors;

• turn chillers off (if conditions allow).

Tests were carried out, and in one of them, where the use of the chilled water storage was initiated, building electrical demand was reduced by up to 800kW.

Buildings can participate in demand response programs provided their control systems have the capabilities to allow the flexible use of the electro-mechanical systems in place. If appropriate care is taken, the occupants are minimally impacted, as was the case at Bell Trinity Square and in several studies by the National Research Council of Canada (NRC) (Newsham et al, 2006).

In the studies carried out by NRC, the rate at which temperatures were raised and lights dimmed significantly limited the impacts on the comfort of the occupants. The limited impact is because human beings experience a natural delay in sensing incrementally small changes in lighting levels and temperatures. Changes typically associated with load shedding (around 1.5°C over 2-3 hours) are unlikely to be detected by occupants, and if detected, would likely be acceptable in the circumstances (Newsham and Mancini, 2006).

The International Energy Agency expects that as the Smart Grid matures in the coming years, dynamic pricing will play a more important role in determining energy costs (IEA, 2003). In such a scenario the cost of electricity will reflect the true cost of its production and delivery, which could result in differences of more than 10 times between on-peak and off-peak electrical energy costs (Fulton, 2008). Therefore it is expected that flexibility in the operation of buildings will become a driver in their design and renovation. Such flexibility could favour the increasing use of variable speed drives for motors, dimmable lighting, as well as the integration of thermal energy storage.

There is little doubt that we are in the midst of a transformation of the relationship between buildings and the grid in North America. The need to have buildings that are responsive to demand response signals is expected to have impacts both on their controls and on their design. This evolution will lead to buildings that are increasingly intelligent and able to work seamlessly with the electrical networks, not only to optimize their own energy performance, but also to contribute to improving the performance of the entire grid. cce

Meli Stylianou, M.Eng., is a projects manager at NRCan’s CanmetEnergy research centre in Varennes, Quebec. He is the recipient of ASHRAE’s Willis H. Carrier and the AQME Energia awards. He formerly was manager of the Canadian Solar Buildings Research Network.


Canadian Electricity Association, 2010. “The Smart Grid: A Pragmatic Approach.”

Fulton, S. 2008. “Economic Demand Response.”

International Energy Agency, 2003. “The Power to Choose: Demand Response in Liberalised Markets.” IEA/OECD, Paris.

Newsham, G. R. et al, 2006a. “The Effect of Ramps in Temperature and Electric Light Level on office occupants.” 2006 ACEEE Summer Study on Energy Efficiency in Buildings, Pacific Grove, CA.

Newsham, G. R. and S. Mancini, 2006b. “The Potential for Demand-Responsive Lighting in Non-Daylit Office.” Leukos, V.3 No. 2, Oct. 2006.

Stylianou, M, “Smart Net Zero Energy Buildings and their Integration in the Electrical Grid.” 2011, LV-11-C039, ASHRAE Transactions.


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