Smart Grids

Applications

The smart grid concept builds on technologies that were used during earlier attempts at upgrading the functionality of power networks. In the 1980s, metering systems were introduced to support the monitoring loads from large customers, largely to facilitate remote meter reading. During the 1990s this evolved into the Advanced Metering Infrastructure which acted as a database management tool to facilitate two-way communications to enable demand response solutions. The primary purpose of such a system was to enable load-shedding during peak load conditions when the stability of the grid may be compromised. Such an approach was initially put in place in 2000, with Italy's Telegestore Project in which 27 million homes using such smart meters were connected via power line communication.

Smart meters add continuous communications so that monitoring can be done in real time, and can be used as a gateway to demand response-aware devices and "smart sockets" (the analog to electrical sockets)  in the home. "Smart appliances" operate under a "real-time pricing" system that charges more for electricity during peak hours and less at base hours. This pricing arrangement allows consumers to improve household energy efficiency and lessen carbon output by regulating their energy usage. Utilities would focus on appliances that had relatively large demands but whose functionality could be cycled at little or no cost to the customer, such as industrial and domestic air conditioners, refrigerators and heaters. 

Over the past five years the concept of smart grids has evolved to address the following issues in addition to remote meter reading:

* Improve the effectiveness of pricing information to enable customers to make informed choices
* Enable distributed generation to sell electricity back into the grid
* Add the other half of electricity markets - demand - to the supply markets
* Improve the reliability of supply to existing networks
* Increase the proportion of non-dispatchable technologies to the grid thus supporting a lower carbon development trajectory
* Enable power networks to self-heal

The Intelligrid® Project,  operated by the Electric Power Research Initiative (EPRI), was one of the first initiatives focusing on Smart Grids.  EPRI developed a vision for the power system of the future  of the Smart Grid with the following attributes and objectives: ³

• Self-healing and adaptive 
• Interactive with consumers and markets
• Optimized to make the best use of resources and equipment
• Predictive rather than reactive
• Distributed across geographical and organizational boundaries
• Integrated through the merging of monitoring, control, protection, maintenance, EMS, DMS, marketing and IT
• More secure from attack

Case Studies

There are a number of examples of smart grids being deployed on the community level, such as in Austin, TX, or even at the country-wide level, such as in Italy.  Encouraged by successful deployments at various scales, there are many more smart grids planned for use in more communities and countries.

Austin, Texas (USA)

Austin Energy, owned by the City of Austin, Texas took the lead to build Smart Grids in order to improve the energy infrastructure. According to DOE they are the number one seller of green energy in the U.S. and the first electric utility to receive ISO 9001 certification. Lately, Austin Energy has cut costs, increased customer satisfaction, attracted new high-value customers to the city of Austin, and established a foundation for a Smart Grid.? Experts believe those efforts make the city of Austin attractive to IT companies, such as Google and Hewlett-Packard(HP). ⁴ In late 2008, Texas utility Austin Energy initiated the first phase of its grid deployment using GE Energy’s smart grid software. Smart grid is a suite of products and software technologies that can integrate smart meters, capacitors, geospatial information systems and demand response technologies. Austin Energy already has integrated GE Energy’s distribution management system technology into its existing outage management system. According to the vice president of GE Energy’s transmission and distribution business, “Unlike many utilities that lead their smart grid initiatives with smart meters, Austin Energy is leading with innovative software solutions that make products, like smart meters, even more impactful”. ⁵

Italy

Italy  The world's largest smart meter deployment was undertaken by Enel SpA connecting over 27 million customers between 2000-2005. These meters are fully electronic with integrated bi-directional communications, advanced power measurement and management capabilities, an integrated, software-controllable disconnect switch, and an all solid-state design. They communicate over low voltage power line using standards-based power line technology from Echelon Corporation to data concentrators at which point they communicate via IP to Enel's enterprise servers. Enel has estimated the cost of the project at approximately 2.1 billion Euros and the savings they are receiving in operation of 500 million Euros per year, an astonishing 4 year payback.

Pacific Northwest (USA)

GridWise program was initiated by Pacific Northwest National Laboratory (PNNL) with the intent to use new technology to transform the electric power system. As the program evolved, the term of GridWise was selected and the foundation of the GridWise vision is that information technology can revolutionize the electric system. PNNL believes to create a distributed, yet integrated system can empower consumers to participate in energy markets to stabilize prices. Utilities and third parties will create value by developing solutions that cross enterprise and regulatory boundaries. In the meantime, this transformation of the energy system responds to the urgent need that can enhance national security. A distributed, network-based electric system can identify “problems” and reduce single-point vulnerabilities by incorporating autonomic system reconfiguration. ⁶

GridWise was proposed as a new DOE program for fiscal year 2005 as a Presidential Initiative. The DOE GridWise Program is newly formed program for 2005 within the DOE Office of Electricity Delivery and Energy Reliability. According to DOE, the term GridWise refers to “operating principle of a modernized electric infrastructure framework where open but secure system architecture, communication techniques, and associated standards are used throughout the electric grid to provide value and choices to electricity consumers.” ⁷Under this umbrella, various technologies are being developed. PNNL has conducted demonstration projects on GridWise and many researchers are working on smart appliances in household.

Smart appliances are a critical part of GridWise program. Appliances with special computer chips can sense when the transmission system is stressed and partially turn themselves off to save critical kilowatts, which has the potential to stave off catastrophe. ⁸

China

The Chinese government uses smart grid as its approach to achieve its national goal of reducing China’s energy consumption per unit of GDP by a cumulative 20% by 2010. China’s five independent electricity generating companies and several transmission companies operating separately in different regions results in the separation of grids network. The existing regional grids have weak interconnections between provinces or not interconnections between grids. The Eastern China Grid Corporation initiated a feasibility study of "smart grid" technology in October 2007. ⁹

Drawbacks and Limitations     

Because customers are normally passed on the cost of new services ultimately, these same customers need to benefit from these investments to make Smart Grids a commercially viable investment. How can customers benefit:      

1.  Enabling them to save money by shifting their time of use to periods when electricity costs are cheaper
2.  Make it possible for non-essential loads to be temporarily shut-down when prices are high (also improving system stability)
3.  Improving system reliability by making it easier for power utilities to electrically isolate system faults
4.  Enabling customers to choose the reliability of service they need and the price associated with that reliability
5.  Providing improved capacity for use of renewable energy supplies that can not be dispatched (such as wind and solar)
6.  Enabling customers to provide energy storage services to the grid (at a fee) through devices like electric vehicles   

Communications Protocol:  Ultimately, the Smart Grid would provide the enabling environment for all aspects of the power system to communicate - from the generator, through the transmission and distribution networks, to the meter to the customers' appliances/devices.  The challenge is to ensure that the communications protocol that is established will be compatible up and down the food chain.  The communications protocol standards need to be established early so that technologies are not orphaned.  Alternatively, adjunct devices would be needed, say at the wall socket, to accommodate changes in communications.¹⁰

Barriers to Entry

Currently regulatory and technological barriers limit the deployment and implementation of Smart Grid technology.

The current regulatory framework, both from state and federal level, erects barriers to smart grid deployment. Cost recovery is the central barrier. A utility will need to secure approval of the state utility commission for cost recovery. State commissions would have reluctant to approve the cost recovery given the uncertain economic return on investment to smart grid deployments. ¹¹ However, state commissions start to take into account environmental and energy security policy goals. The issue of cost allocation is another important factor within the cost recovery of smart grid deployments. Substantial regulatory support needs to be in place to support the deployments of smart grids.

The lack of standards and protocols relating to smart grids presents an additional barrier since it limits the interoperability of smart grid technologies. As the industry grows, first-movers have the potential to entrench their leadership and lock up essential intellectual property (IP) to limit competition and interoperability. ¹²  

Footnotes

¹: Litos Strategic Communication (under contract for the DOE) (2008-09-10), The Smart Grid: An Introduction, United States Department of Energy, page 7.  Retrieved on 7 February 2009.

²:Litos Strategic Communication (under contract for the DOE) (2008-09-10), The Smart Grid: An Introduction, United States Department of Energy, p. 11. Retrieved on 7 February 2009.

³: Sam Newman. "Smart Appliances for an Energy Efficient Future." 7 April 2008. Retrieved on 7 February 2009.

⁴: Michael Burkhalter ,Austin Energy Delivers Opportunity, Smart Grid Newsletter.

⁵:Austin Energy Launches Smart Grid Deployments , Georgia, United States [RenewableEnergyWorld.com]

^{6 7}:How Did GridWise Start?, GridWise at PNNL.

⁸:Bryn Nelson,Smart appliances learning to save power grid,msnbc.com .

⁹:Lou Schwartz and Ryan Hodum,"Smart" Energy Management for China's Transmission Grid ,RenewableEnergyWorld.com.

¹⁰: Joe Hughes, Interoperability 101: The Basics of an Interoperable Grid, Gridwise News, Nov 26, 2008.

^{11 12}:Ray Gifford and Mark Walker,Smart Grid and the Energy Independence and Security Act of 2007,Kamlet/Shepherd, Attorneys at Law.

References

Simple Explanation of Smart Grids http://www.smartgridnews.com/artman/...ut_It-530.html

Smart Grid Newsletter (US centric): www.smartgridnews.com

EPRI's "Intelligrid" Program (smart grids by another name): www.intelligrid.info/

EU Smart Grid Vision and Strategy: ec.europa.eu/research/energy/pdf/smartgrids_en.pdf

EU Smart Grid Web site: www.smartgrids.eu and 

US Department of Energy: www.oe.energy.gov/smartgrid.htm

Ontario (Canada) Smart Grid Forum: www.ieso.ca/imoweb/marketsandprograms/smart_grid.asp

Smart Grids Africa: www.spintelligent-events.com/smart-grid-africa/en/index.php