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Virtual Storage FIRST

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I agree that demand management should front and center. I see two issues with demand management; both are addressable, but not easily:

First, communication and control. Appliances (today) are dumb: the refrigerator operates solely to keep its temperature in range, without first checking in with the power grid. The "Internet of things" will provide the infrastructure to manage devices. We also need a standardized communications protocol and control system to let the grid and the devices coordinate--something I believe is underway.

Second, time scales. Even assuming we've got a lot of our energy-hungry appliances wired up, the willingness of consumers to defer demand decays. For example, air conditioning: its acceptable to delay starting the A/C by a minute or two, allowing the inside temperature to go a bit above the set temperature range, but turning off the A/C for an hour isn't acceptable in most settings. Refrigerators need to stay in a fairly tight temperature range to avoid freezing or ruining food. Running the clothes dryer at 2am is a great idea unless you want to get the clothes out and folded/hung before they wrinkle.

EVs represent one of the best starting points for demand control. The Model S is already part of the "Internet of things", and controlling the rate and timing of charging should be relatively easy. People are willing to defer charging by hours, provided that the car is ready to go at the required time.