MOVING FROM CONCEPT TO REALITY,
THE SMART GRID WILL REVOLUTIONIZE
THE WAY PEOPLE BUY, SELL, AND USE ELECTRICITY.
BY ERIC LIGHTNER AND RICH SCHEER
72
ELECTRIC PERSPECTIVES
IN THE FUTURE, the importance of electricity
can only increase. In fact, electricity will be one of
the keys for solving two of the 21st century’s great
energy challenges: dependence on imported oil;
and atmospheric emission of greenhouse gases
and global climate change. The solutions to both
lie with cleaner and more fuel-efficient sources of
electric power generation, more energy-efficient
buildings and end-use appliances and equipment,
and steadily increasing numbers of plug-in hybrid
electric vehicles (PHEVs).
But these solutions don’t work without greater
attention to the electric grid itself, particularly
its security, reliability, capacity, functionality, and
flexibility. Without the grid—which encompasses
a vast continental delivery network of power lines,
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73
substations, transformers, and switchgear—there
would be no infrastructure to keep homes and offices lighted, factories humming, computers networking, communications flourishing, hospitals
operating, and buildings comfortable.
Modernization of the electricity grid is thus an
important national priority for the Department of
Energy’s (DOE’s) Office of Electricity Delivery and
Energy Reliability (OE). The country needs a common vision of the future of electricity
delivery and the need to modernDELEGATES AGREED
ize the grid through expanded public
THAT THE ELECTRIC
and private investment in the latest
DELIVERY SYSTEM OF
technologies, including the comTHE FUTURE SHOULD
prehensive integration of information systems, communications, and
PROVIDE SEVEN
control strategies to physically knit
SMART GRID
the grid more closely together from
CHARACTERISTICS.
generation to transmission to distribution to end-use device. (See the
sidebar, “A National Priority.”)
This vision involves more than incremental change to the way things are currently done.
Rather, it is based on a set of possibilities and capabilities that today’s grid cannot address or is only
able to address in niche applications in particular
locations. Today’s grid needs to be upgraded to a
“smart grid” that supports a wider array of clean
energy choices for customers, has fewer outages
and power quality disturbances, anticipates and
Eric Lightner is director of the Office of Electricity’s Smart
Grid Task Force for the Department of Energy and Rich
Scheer is vice president of Energetics Incorporated.
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ELECTRIC PERSPECTIVES
provides faster restoration when problems do occur, and enhances electricity markets delivering
the world’s best and cleanest electricity services.
Vision for the Future
Last June, OE held a technical workshop on definitions and metrics for measuring progress toward
implementation of smart grid technologies, practices, and services. More than 140 experts from
utilities, national trade associations, equipment
manufacturers, state agencies, universities, and
national laboratories attended and discussed data
sources and measurement methods for assessing
smart grid implementation by utilities, energy service providers, customers, and other stakeholders.
Delegates agreed that the electric delivery system of the future should provide seven smart grid
characteristics.
■ Active participation by consumers through the
use of advanced meters and communications systems to make it easier for users to participate in demand-side programs, including energy efficiency,
load management, and dynamic pricing. By viewing their power use in real time, customers will be
able to turn their appliances and equipment on
and off automatically in response to dynamic pricing and thus manage their electricity consumption
(and bills) in brand new ways.
■ Accommodation of all generation and storage options through expanded installation of distributed
generation, renewable power systems, and energy
storage devices with better interoperability for safe
operation and integration into utility planning. By
A National Priority
ast December, Title 13 of the Energy Independence and Security Act of 2007 provided new authorities for the Department of Energy’s (DOE’s) Office of Electricity
Delivery and Energy Reliability (OE) in “smart grid” technologies, tools, and techniques. These new authorities complement existing ones in visualization tools and control
systems, energy storage and power electronics, high temperature superconductors, grid
integration of renewable and distributed energy systems, congested transmission corridors, and regional electricity planning. Title 13 proposes the smart grid as a unifying
concept for modernizing America’s electric infrastructure and states that it is the “policy of
the United States” to support its development.
Having invested in several related technology development projects for a number
of years, OE is prepared to implement Title 13 and take a leadership role in smart grid
development. Recent projects include the development of interoperability standards for
grid-connected distributed energy systems, deployment of phasor measurement units
for wide-area transmission grid operations, assessment of supervisory control and data
acquisition systems to identify cyber security vulnerabilities, and development of power
electronic switches and inverters for energy storage systems, faster response times, and
more resilient grid operations.
Promoting and building the smart grid is a team effort, and OE works closely with other organizations engaged in
smart grid development, including the American Public Power Association, Electric Power Research Institute, Edison
Electric Institute, Federal Energy Regulatory Commission, National Rural Electric Cooperative Association, National Association of Regulatory Utility Commissioners, Galvin Initiative, National Energy Technology Laboratory’s Modern Grid
Strategy group, and the International Energy Agency’s Electric Network Analysis Research and Development project.
L
installing and interconnecting photovoltaic arrays
on their roofs, energy storage devices in their basements, combined heat and power units on their
premises, or PHEVs in their garages, customers will
use the power they need and sell the excess back to
the grid—routinely, seamlessly, and automatically.
■ Presence of new products, services, and markets
such as automatic meter reading, remote connect/
disconnect, individualized information on customer usage patterns, energy efficiency strategies,
and new rate options.
■ Power quality options for the range of needs in
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a digital economy by enabling consumers to work
more closely with utilities to achieve the levels of
power quality to support personal or business activities.
■ Optimal asset utilization and operating efficiency
with smart grid equipment to reduce peak load and
lower the overall cost of electricity to consumers.
■ Anticipation of and response to system disturbances in a self-healing manner by having devices
that improve the situational awareness of grid operators so they can reALL STAKEHOLDERS
spond more quickly to problems and
ARE NOT YET ON THE
prevent disturbances from cascading
SAME PAGE WITH REinto regional outages.
SPECT TO THE SMART
■ Operation with resiliency against
GRID, AND THERE IS
physical and cyber attacks and natural disasters through hardened
CONFUSION ABOUT
computer control and energy manHOW TO PROCEED.
agement systems to make them less
vulnerable. More access to power
supplies that are distributed throughout the system
enhances resiliency and reduces the vulnerability
to disruptions if power plants or long-distance
transmission lines are targeted for attack.
How Do We Know We Have a Smart Grid?
Ensuring that the grid has these characteristics
involves identifying metrics, establishing baselines,
and collecting data to track developments. We also
need to account for the level of development and
deployment that has already occurred and to recognize that the unique characteristics of each utility’s
transmission and distribution system may require
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ELECTRIC PERSPECTIVES
its own baselines, targets, and measurements. As a
result, it is probably not appropriate to track smart
grid implementation in the same way for every entity that adopts smart grid technologies, practices,
and services.
Possible metrics might include
■ the percentage of customers capable of receiving information from grid operators and opting to
make or delegate decisions about electricity consumption based on that information;
■ the percentage of distributed generation and
storage devices that utilities can control in coordination with the needs of the power system;
■ the number of smart grid products for sale that
are certified for end-to-end interoperability;
■ the number of measurement points per customer
for collecting data on power quality, including
events and disturbances;
■ the amount of distributed generation capacity
connected to the electric distribution system and
available to system operators as a dispatchable
resource;
■ the percentage of grid assets (such as transmission and distribution equipment) that utilities can
monitor, control, or automate; and
■ the percentage of entities that exhibit progressively mature characteristics of resilient behavior.
We need further research and analysis to refine
the metrics and develop methodologies and data
for establishing baselines and measuring progress
toward implementation. OE plans to use these and
other metrics to define the research, development,
demonstration, analysis, and technology transfer
activities it will undertake as authorized by the Energy Independence and Security Act of 2007.
Technological Progress
Many of the technologies, tools, and techniques for
achieving this vision already exist and are commercially available today. One of the challenges is to
find cost-effective ways to accelerate their acceptance and deployment in the marketplace. Another
challenge is to develop approaches for the seamless
integration and interoperability of them with each
other and with legacy utility systems.
It normally takes a major effort to innovate and
change the way things are currently done. Power
companies, state agencies, consumers, and other
electric power industry stakeholders are not yet on
the same page with respect to the smart grid, and
there is confusion about what it is, what needs to
be done, and how to proceed. Because the smart
grid covers a variety of technologies, practices,
and services—covering electric generation and
storage, delivery, and consumption—misunderstandings about what it is (and what it is not) are
common. DOE is trying to fill that void by providing
a forum for the exchange of information and ideas.
In addition to sponsoring a series of smart grid
E-forums and developing web-based educational
materials, DOE is facilitating stakeholder interaction to achieve a common understanding of the
challenges and opportunities, what should be done
about them, and the respective roles of government
and the private sector.
However, expanded testing and demonstrations
are needed to prove that smart grid systems will
work as advertised, to validate their estimated
costs and performance, and to verify that they can
deliver enhanced functionality, services, and value
to consumers and power companies. When this
has been done, the next phase would involve scaling-up to mass production (thus bringing down
costs) and expanding installations beyond pilot
and demonstration projects to cover entire service
territories, states, multi-state regions,
and inter-regional interconnections.
EXPANDED TESTING
Some smart grid systems are here
AND DEMONSTRAtoday and ready for use. Advanced
TIONS
ARE NEEDED
metering infrastructure ( AMI ), for
TO PROVE THAT
example, involves the installation of
communications hardware and softSMART GRID SYTEMS
ware and associated system and data
WILL WORK AS
management software that creates a
ADVERTISED,
network between advanced meters
and utility business systems which
allows collection and distribution of information
to customers and others, in addition to the utility
itself. The system is capable of providing power
consumption information to electricity customers, utilities, and other parties on at least a daily
basis and enables them to participate in and/or
provide demand response products, services, and
programs. The system also supports additional features and functionality related to system operation
and customer service, such as outage detection and
management and remote connect/disconnect.
Phasor measurement units (PMUs) involve a
network of high-speed digital recorders that take
NOVEMBER / DECEMBER 20 08
77
data snapshots of system voltage, current, and frequency 30 times per second (compared to once every 4 seconds with current supervisory control and
data acquisition—SCADA—systems). The purpose
is to develop a more complete picture of the grid’s
status to help operators maintain reliability, prevent minor problems from cascading into regional
outages, and analyze root causes of problems that
do occur to prevent them from recurring in the
future. A key feature of this network
is to time-synchronize the measureTHERE ARE NEEDS
ments using satellite global positionFOR “NEXT GENERAing systems to enable fast post-event
TION” SYSTEMS WITH
analysis—in hours instead of days.
EVEN GREATER FUNCThese enhanced measurement caTIONALITY AND APPLIpabilities equip grid operators to
see—in real time—dynamic condiCATIONS TO HASTEN
tions on the grid such as power osTHE SMART GRID.
cillations and the rate of change of
frequencies and phase angles that
are not visible with today’s monitoring technologies. PMUs were developed by Virginia Tech in the
early 1980s to provide time-synchronized data on
voltage and current phase angles and frequency
rates of change many times a second. This level of
time resolution and granularity is the equivalent
for grid operators of what a magnetic resonance
image (MRI) can show radiologists versus what they
can glean from an X-ray.
SCADA systems themselves, which began operating in the 1960s, monitor operations of electric
power networks (and other industrial and manufacturing processes), collect and communicate
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ELECTRIC PERSPECTIVES
data at scheduled intervals to centralized facilities,
and provide reports to grid operators to identify
problems and enable corrective actions.
Research Continues
While these and other smart grid systems are available and being deployed today, there are needs for
“next generation” systems with even greater functionality and applications to hasten the smart grid.
For example, the development of technologies,
tools, and techniques to integrate clean energy systems cost effectively into the electric transmission
and distribution system is an important national
priority. This includes both remotely located supplies such as wind, concentrated solar, geothermal,
nuclear, and fossil with carbon capture and sequestration, as well as distributed energy resources
such as rooftop photovoltaic arrays, combined
heat and power units, energy storage systems, and
hydrogen fuel cells. Successful integration strategies will lower costs, increase effectiveness, and
enable other benefits such as opportunities for
local improvements in electric service and power
quality and a host of new applications to provide
customers with a greater array of choices for lowering costs, reducing environmental impacts, and
managing energy bills.
A recent OE solicitation for projects in renewable and distributed energy integration resulted in
nine awards totaling up to $50 million. Conducted
over the next three to five years with the aim of
developing information from real-world examples
on the universal benefits that smart-grid-related
Worries About a Smart Grid Betamax
By Dennis Wamsted
t last count, Suedeen Kelly says, 70 utilities in 33 states were working on pilot projects related to advanced
meters. Not all these projects necessarily would fit within the definition of smart grid technologies, but clearly a
lot of development is under way. With that, comes the concern about the ability of the technologies being tested
to communicate with one another, says the commissioner for the Federal Energy Regulatory Commission. Lacking that
ability, we could end up with modernized pockets of the grid, with one area operating on the equivalent of Betamax technology and the other running VHS.
To prevent this, Congress approved a two-step process in the Energy Independence and Security Act of 2007 that
calls on the National Institute of Standards and Technology (NIST) to develop interoperability standards for smart grid
devices and systems and charges FERC with adopting those standards for future interstate transmission rulings.
But that process will take time, says Kelly. NIST hopes to issue a report by year’s end about the industry’s smart-grid
status, but there is no legislative deadline for it to release its standards, and FERC will not move forward with a rulemaking until that process is completed.
So the question becomes: “What will we do in the meantime?” One answer is the recently established FERC-National
Association of Regulatory Commissioners Smart Grid Collaborative.
By working together, says Kelly, the states and FERC can minimize the waste in time and money associated with piloting a technology that another company is evaluating elsewhere. Also, they can hash out interoperability issues even
without a FERC rulemaking. A clearinghouse for project data will allow members to evaluate competing technologies.
Another answer may come directly from FERC. Speaking for herself and not the commission, Kelly says she thinks it
may be a good idea for FERC to develop a smart grid policy statement, essentially putting the commission on record as
favoring grid modernization projects. This would set the stage for utilities to file a request under Section 205 of the Federal Power Act for authority to recover the costs of smart grid investments.
The initial reaction to her idea was positive, Kelly says, but it is still in the trial balloon stage. And like the work under
way at NIST, developing such a statement would take a substantial amount of time.
Kelly is enthusiastic about smart grid technologies. At a commission meeting earlier this year, she said: “Optimizing
the design and operation of our transmission and distributions can yield great efficiencies and a decrease in use of electricity. Having a smart grid in place will allow for applications that will facilitate and increase demand-side resources, as
well as energy efficiency.” But, “how do you get the most bang for your buck?” she wonders.
A
Dennis Wamsted is a business writer in Arlington, VA.
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Smart Grid Potential, Real-World Caution
By Dennis Wamsted
red Butler is enthusiastic about the smart grid’s potential. “People in this country waste energy like crazy,” says
Butler, a commissioner on the New Jersey Board of Public Utilities and vice president of the National Association
of Regulatory Utility Commissioners (NARUC). “The smart grid can revolutionize the way we buy, sell, and use
power,” he continues. “We have a great opportunity here.’’
He sees potential downsides, too. He is wary about repeating the mistakes of the electric utility deregulation wave that
swept across the United State in the late 1980s and 1990s. The promise of deregulation was that customers would save
money, and that has not been true across the board.
“We want people to accept the smart grid,” he says. “We can’t force it on them.” His dream is to have people calling
the commission, asking for smart meters because their neighbor has one, and not being upset about their utility rates.
To make that happen, he continues, the industry must demonstrate the smart grid’s benefits. Technology developers
and utilities make many claims about the potential energy and cost savings a modernized grid would offer. What regulators want to know is simple: “Will it deliver on those promises?”
To help evaluate such promises, Butler serves as co-chair of the NARUC-Federal Energy Regulatory Commission
Smart Grid Collaborative. “It’s important to share experiences about the smart grid among the states,’’ he says. With
many projects under way in their states, regulators can avoid seeing the wheel reinvented each time. That’s why a clearinghouse to share results from ongoing projects is so important.
Another goal, says Butler, is to educate state regulators. Utilities will seek to recover their costs, he continues, and
commissioners must be able to figure out what investments make sense and how consumers will benefit.
“Commissioners need to know what the right questions are: How much of this is needed? What do you do first? Do
you need smart meters to every house? What are the benefits and pitfalls?”
Butler also points out that for the smart grid to work, state regulators will have to change their approach to ratemaking. “You can’t have smart meters and dumb rates,” he says.
Moving to time-of-use rates will be an upheaval for residential customers and regulators alike, he adds. But it is vital
to the long-term success of the smart grid. Here, too, the results from current projects should prove invaluable.
Right now, many utility customers have little or no interest in smart meters, says Butler. Residential customers simply
don’t focus closely on their home energy consumption. So, he continues, successful demonstration projects are a must
to show both regulators and consumers the potential of smart technologies. Otherwise, he warns, these technologies
may end up doing little more than the current dumb devices that run the grid.
F
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ELECTRIC PERSPECTIVES
installations can provide, these projects include
distribution system integration and performance,
compressed-air generation, fuel cells, energy storage and control, solar trough boosters, advanced
sensing and switching, and heat recovery systems.
Technical objectives include demonstration and
validation of improvements in electric system reliability and supply security, interoperability of
distributed energy devices, the potential for peak
load reductions and automated local operations,
and possible improvements in power quality and
local grid stability.
The public/private nature of the projects is important. There are several. The city of Fort Collins,
CO, for instance, will research, develop, and demonstrate a 3.5-megawatt coordinated and integrated
system of mixed distributed resources to achieve
a 20-30 percent peak load reduction on multiple
distribution feeders in cooperation with Larimer
County, Colorado State University, InteGrid Lab,
Community Foundation of Northern Colorado, the
Governor’s Energy Office, Advanced Energy, Woodward, Spirae, and Eaton.
San Diego Gas & Electric will develop a dispatchable distribution feeder for peak load reduction
and wind farming in cooperation with Horizon
Energy Group, Advanced Control Systems, Pacific
Northwest National Laboratory, University of San
Diego, Motorola, and Lockheed Martin. The project
aims to prove the effectiveness of integrating distributed energy resources with advanced controls
and communication systems to improve stability
and reduce peak loads on feeders/substations.
Challenges and Opportunities
Accomplishing everything that needs to be done to
transform the electric grid, revolutionize electricity
delivery, and make progress in the implementation
of smart grid technologies, tools, and techniques
involves national leadership, effective partnerships,
and a shared vision of the future. OE’s job is to work
with public and private sector partners to research,
develop and help bring to market the “next generation” of electricity delivery technologies and infrastructure. Tackling this
ACCOMPLISHING
requires expanded levels of technical
EVERYTHING
THAT
innovation and entrepreneurship in
NEEDS
TO
BE
DONE
the electric power industry, as well as
INVOLVES
NATIONAL
mechanisms for marshalling the collective resources of all stakeholders,
LEADERSHIP AND A
including the federal government,
SHARED VISION OF
state and local government agencies,
THE FUTURE.
electric utilities, trade groups, equipment manufacturers, vendors, consumer and environmental groups, universities,
and national laboratories. Over the coming decade
there will be billions invested in new transmission
and distribution equipment. By working together
in a coordinated manner, we can help ensure that
these investments benefit everyone—customers,
power companies, and society as a whole.
While the challenges are great, the opportunities to dramatically improve the infrastructure for
electricity delivery are even more important. The
potential benefits are enormous: The grid can be
made more reliable, affordable, efficient, and environmentally friendly. The time to act is now. ◆
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