1. 2. 3. The Situation Today
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Smart Grid: Powering a New Generation of Prosperity 1950s Now 1. The Situation Today 2. How Smart Grid Helps 3. How to Get It Done Substation Substation 1 We’re Moving to an Electricity Economy SITUATION TODAY % of U.S. GDP dependent on electricity The electrification of everything The explosion in population The inflation of expectations The increase in importance Manhattan Institute, 2008 We’re utterly dependent on electricity for our economy, lifestyle, security 2 But Our Grid Is Not Up to the Challenge 1950s SITUATION TODAY Now Invented in the Age of Edison Designed in the Age of Eisenhower Installed in the Age of Nixon Electro-Mechanical, not Digital Substation Substation Is it any wonder we have blackouts? 3 And We Haven’t Reinvested... SITUATION TODAY ... to maintain it • • • 70% of transmission lines are 30 y years or older 70% of transformers are 30 years or older 60% of circuit breakers are 33 years or older (DOE) ... to innovate and upgrade • The electric power industry spends less on R&D than virtually any other industry in the world As goes the grid, so goes our growth 4 Smart Grid Applies Digital Technology SMART GRID Smart devices watch what is going on Then computers use the data to predict, prevent, balance, and optimize Every industry has gone digital... except the one the others rely on 5 SMART GRID The World Is Passing Us By US EU • $120 $ million annual federal grid R&D • 5% smart meters • $1.2 billion annual federal grid R&D Sweden China • 100% smart meters • 100% smart meters by 2013 • $170 billion grid stimulus Italy • 100% % smart meters Middle East • Gulf Grid • Sustainable cities New Zealand • 100% smart meters 6 Without a Smart Grid We Are Vulnerable SMART GRID To blackouts • August 2003: $6 billion damages, 9 seconds to propagate To outages • Cost $150 billion per year because momentary outages bring down server farms, robotic manufacturing, etc. To disasters or terrorist attack • We need a self-healing grid To escalating electric rates • We are heading for a “gas crisis” in electric rates • Avoid $102 billion in unnecessary plants over 20 years (Brattle Group) To global competition • The developing world is leapfrogging directly to a Smart Grid 7 With a Smart Grid We Gain Major Benefits SMART GRID Short-term jobs • $16 billi billion = 280,000 280 000 jjobs b (KEMA, Inc.) Long-term jobs • Economic E i multiplier lti li off new companies i and d exportable t bl products d t • Essential to all other industries Cleaner energy • Move renewable energy where needed Optimized, Optimized efficient energy • Balance demand and supply and make the system efficient More reliable energy • Detect and prevent A digital grid is the foundation of our future prosperity 8 We Can Catch Up Quickly and Affordably GETTING IT DONE Must spend anyway to meet growth • $450-900 billion over 20 years $450 900 billi Doesn’t have to cost more • When buying anyway, anyway buy “smart” smart • Highest estimates are $15 billion over what would spend anyway One pizza per month per household $15 billion / year 111 million households $11.26 / month / household Collaborate to save costs Pays y for itself What we waste in outages could finance our future 9 Use the Four Pillars of a Phased Approach GETTING IT DONE 1. Planning: Create a Smart Grid roadmap • West Virginia and others pointing the way • Consider regional coalitions for more value and leverage 2. Principles: Use open standards • For interoperability and lower costs 3. Pricing: Insist on accurate, transparent costs • Time-of-use and locational pricing to reflect true cost • Up to the PUCs to decide how to use that information • Let customers see their own energy info 4. Policy: Reward right actions • Give utilities incentives to sell less electricity • Give “prime-the-pump” incentives to innovate and hire • Let consumers share the benefits We can pay for each phase through jobs and benefits 10 The Smart Grid Is Similar to Previous Legacies Transcontinental Railroad GETTING IT DONE Phone Network Electric Power Grid Interstate Highway System Internet Backbone 11 Summary SUMMARY The Situation Today • As goes the grid, so goes our growth How H S Smartt G Grid id Helps H l • A digital grid is the foundation for future prosperity How to Get It Done • We can pay for each phase through jobs and benefits Contact information • Jesse Berst, Managing Director Gl b lS GlobalSmartEnergy tE jesse.berst@GlobalSmartEnergy.com 206-201-1860 The Smart Grid is a legacy that will last for generations 12
