Werner Ziel on Siemens and the Smart Green Tower

On September 1, I interviewed Werner Ziel of Siemens AG on the phone. At the time, Mr. Ziel worked in Siemens’ Department of Building Automation as a “solution engineer” and was responsible for special projects including Freiburg’s Smart Green Tower (project description here).

(Note: The following interview is not a direct transcript. It is written by me, Priya Donti, and is based on notes I took during the meeting. The interviewee reviewed this writeup before its publication.)

Priya: What is your definition of Smart Grid?
Mr. Ziel: Smart Grids have to handle fluctuating generation, like what we have with wind and solar energy, and enable intercommunication between the producer and the consumer. In our projects, we see that Smart Grids are all about communication, so ICT is a big requirement.

Priya: How does the Smart Green Tower relate to your work in this area?
Mr. Ziel: Siemens already develops solutions for climate conditions within buildings — temperature sensors, temperature and humidity controllers, blinds, lights — and we’re working on a new power management module that controls each energy flow inside a building. Mr. Frey, the Smart Green Tower project’s lead architect, came to us with an additional idea: self-consumption optimization, or using self-produced energy inside the building. This idea was something new for us, which is why I’m on the project. Other colleagues are working on grid management and special automation of battery and load control units. We design technical solutions with special requirements, and then bring these new ideas into our standard project portfolio.

Priya: How much of the Smart Green Tower project is simply an implementation of existing products, and how much is new?
Mr. Ziel: The hardware components are mostly developed, and the standard software we use for making climate conditions within a particular room is already developed and established. However, the overall software is probably about 60% new, in particular all the smart applications including energy storage and grid interaction.

Priya: I read about the energy management module you’re designing for the Smart Green Tower. Can you tell me a little bit about it?
Mr. Ziel: Siemens already has a decentralized energy management system (DEMS) module that we designed earlier for generation plants and scheduling within grids. Now, we’re adding new microgrid functionality that connects producers and consumers to balance consumption and generation. Basically, the management system inside the Smart Green Tower building connects with the DEMS through a gateway. The building simply shares its energy consumption amount, as well as how much it can lower or raise this consumption, and the grid accordingly schedules plans for its power generation plants. Based on the resultant schedule, the building can then reduce or increase its energy usage by turning off lights, lowering or raising room temperatures, charging or discharging the building’s battery, etc. The building and grid management systems work largely independently of each other, with the know-how for the building’s energy adjustments hidden inside the building management system interface, and with the grid management system hidden outside. This system is advantageous compared to the one in the US, where the utility sends out a binary signal: either everything is okay or “please shut down your devices or else we’ll run into a blackout.”

Priya: In the model you just described, the building “chooses” the amount by which it can reduce its consumption. What if the grid needs a more drastic reduction?
Mr. Ziel: The desired flexibility can come from either storage or the tolerance of the user. If the user accepts some deviations from their comfort, then we have something more to play with. However, our policy is to always hold a basic level of comfort, since that’s the reason customers buy our building automation systems.
….In brown-out or black-out correction mode, we would need to switch off some devices. This is a requirement, but we still need to figure out how we’ll design this on the technical side and include it into the automation software. We may have some special direct-controlled consumers on the grid whom we can switch off from the outside, or we may have control of particular pumps, for example. As far as I know, though, we don’t yet have to worry about this scenario. The German grid is stable and at the moment flexible enough to avoid blackouts. The situation may change in the future if all our nuclear plants are switched off and neighboring countries are unable to transport portions of our energy from north to south.

Priya: Is there precedent for such direct controlling of devices by Siemens?
Mr. Ziel: Siemens already offers a product called remote performance optimization for buildings and Smart Grids. Siemens manages energy for a consumer, and any resultant savings flow half to the consumer and half to Siemens. The focus is on cost efficiency optimization, which means we try to keep the cost of energy as low as possible. Sometimes that means we use more energy but cheaper energy; for instance, we can use energy generated from a rooftop solar panel.

Priya: Do these remote performance optimization systems allow customers to self-consume the power they produce?
Mr. Ziel: Currently, by law, consumers are not allowed to be their own providers of energy or to build their own grid. However, self-consumption applications and optimization will be needed in the future, especially as the feed-in tariff goes away. Then, it will be better to produce and consume your own energy. This pilot in Freiburg will help us test some such applications. 
….We’re also working on another project in Vienna, Austria where we’re building a new district called Aspern.The district was previously a military airport, and now there are plans for 20,000 people to live and work there. The project includes three buildings with self-consumption applications for which we’re doing R&D, and the other buildings have standard solutions. We also installed heat production and storage, so we can put heat in the ground and take it out of the ground on demand. The project runs till 2018, and then Vienna Energy will take over and manage the system. Perhaps in the future, utilities will manage buildings just as they manage power generation plants today. We will see.

Priya: One energy management plan mentioned in the Smart Green Tower project description involves the “targeted recording and control of the electrical energy producers, consumers and storage.” How are the resultant privacy concerns dealt with in the initial design?
Mr. Ziel: We know that we have to be very careful with customer privacy. Data such as occupancy sensor data, which we use to forecast building usage and thereby calculate future energy demand, can easily be interpreted by someone to understand when a user is present in the building. We are really sensitive to this and by law are not allowed to store any data. If we do need to keep certain data, then we first sign an agreement with the user that allows us to store it, and in which we promise the data will never leave our hands.
….We also have protections and security on our network to prevent others from using the data. Our customers have private logins where they can access their private data, which is kept in secure ICT systems. In the case of the Smart Green Tower, the data is kept on a local machine to which the customer has access. We also offer a second possibility, which is that the customer keeps their data on a central Siemens server. Even then, only the customer has access to their own data. We can make a contract with the user to get un-personalized access to their data, but by law that’s it.

Priya: If you’re not storing the data, what kinds of optimization and learning techniques are you using? Are you using online learning techniques (i.e. techniques that learn on data in real time without relying on stored data)?
Mr. Ziel: For long-term optimizations, you need a huge database of data on which you can learn. For short-term reactions, you can more or less use data from real-time access. It’s a question of what within the system you’re optimizing. Each room can be controlled and optimized within itself, but if you need to schedule building-wide plans for a central heater or cooler, then the data has to be anonymously collected. You don’t need to know who has a hot water demand, but you need enough information for the forecast. For large consumers, we often don’t need much private data; the focus of such systems is often the 1 GW heating system, and not each 10-30 W light bulb in the building. If you look at residential systems with only one heater in the home, however, you’re much closer to the people who live there.

Priya: The Smart Green Tower plan states that the building will “seamlessly be incorporated” into Green Industry Park and the district/municipal electric grids. Are there any security issues associated with this integration, and how are these issues dealt with in the initial design?
Mr. Ziel: For the moment, I don’t see this integration as a security problem because the devices are independent. There are gateways and a changing of protocols between different devices, and you need a deep knowledge of the system if you want to hack it. This knowledge is well protected because, by law, there are lots of security mechanisms in the grid. If we connect buildings, then the Internet connections must be secure — VPNs, tunneling, point-to-point access, etc.

Priya: What kinds of assessments are planned to evaluate the Smart Green Tower project’s success?
Mr. Ziel: We have to first define what “success” means for the particular system: Is our optimization goal to save energy, save cost, save CO2? We then take a one-year baseline we can later compare against, adjusting for changes in weather by storing weather data and running an adjustment algorithm so the data from year to year is comparable.

Priya: Do you also do customer assessments?
Mr. Ziel: We do customer assessments if they’re requested for a particular project. In all of our own research projects, we always do a customer survey to see, for example, how often customers change their set points.
….We’re just closing a project in Bornholm, Denmark called EcoGrid, where 2000 residential customers were connected to a feedback system where they could see current energy prices and react accordingly. A new market model was implemented there. We conducted surveys on the customer side and assessed many social aspects at the beginning of the project to understand the kinds of customers we were equipping with automation. Not everyone is a technician; some people like having a big green button, and some people like smartphones. There have to be different solutions for everyone. The EcoGrid project was a huge lesson for us in technical and ergonomic acceptance.
….For the Smart Green Tower project, Mr. Frey did not enlist us to do customer assessments. He basically came to Siemens with his innovative ideas and asked if we could make them into realities, and we said we had experiences from Vienna and Bornholm whose results would flow into the Smart Green Tower solutions. We plan to use the results from this Smart Green Tower pilot project in future projects as well, so we become better and better with each project. Architect Frey is extremely innovative, and we’re happy to have him on board. It’s very useful for us to mirror our ideas with the ideas of the architect; architects tend to have the dreams and we have to get their ideas on the ground, so there’s always a give and take.

Priya: What does the Smart Green Tower system cost?
Mr. Ziel: At the moment, the overall cost is around 40 million Euros for the whole building. However, a lot of the costs are uncertain, since we have to solve some technical questions first. A lot of technologies have to be connected, so we have to talk about interfaces and interoperability, which is difficult.

Priya: By when do you think Smart Buildings and building automation will become widespread in Baden-Württemberg and Germany?
Mr. Ziel: Oh, in the next 10 years. Our wind power capacity is increasing very quickly and we can’t transport this power from north to south Germany, so there’s a huge need for grid flexibility. Buildings can play a big role in the “grid of tomorrow” as shiftable loads. From a technical point of view, we could start implementing in the next 2-4 years, with special solutions today and then standard solutions after that. However, there’s always a question of whether the law will allow us to sell this new business model. Today, customers ask us why we install such huge storage systems, how long it will take to get a return on investment, and when they can earn money with grid storage. The Smart Building model becomes interesting to investors as soon as the power market is deregulated (like the telephone and mobile industries) and we’re allowed by law to establish our own grids or sell energy to cities/other buildings. New market models will then be established, and people will be willing to invest in smart building automation. On the residential side, consumers will buy washing machines or vacuum cleaners with Smart Grid technology and on-board communication. It’s good to see that the world has realized the necessity of these solutions, since we’ll run into problems if we roll out green energy too quickly and ignore all the requests we have from the grid, buildings, and consumers.




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