Archive for the ‘Smart Grid Maturity Model’ Category

Smart Grid – A Vision of the future

Wednesday, April 28th, 2010

Smart grid is the term applied to tomorrow’s electricity system. It encompasses a variety of changes that will transform the way electricity is used, delivered and produced, and result in a cleaner more efficient and more interactive electricity system. It represents a paradigm shift for electricity much in the way that mobile phones transformed communications. The concept is broad; it stretches beyond modernization of the transmission and distribution grid to include devices that allow consumers to better manage their electricity use, new ways of creating and storing electricity, and the widespread adoption of electric vehicles.

The power grid shift to move to a culture of conservation and its substantial commitment to renewable energy will also be supported by the smart grid. Smart meters, a major smart grid component, can give consumers timely information on price and consumption. Emerging devices will empower consumers to act on this information automatically while at the same time improving their energy efficiency, comfort and convenience. New sensing, monitoring, protection and control technologies will enhance the ability of the grid to incorporate renewable generation.The institutional structure of the electricity industry makes it easy to look at how the smart grid will impact each piece of the system in isolation, but the most profound impact of a smart grid may be its ability to link these pieces more closely together.

With the regulator OFGEM, we could have a system of applying structured market operator requirements with corporation responsibilities, encouraging longer-term system network planning, and procuring electricity supply and demand resources connected to the network. Both by the electrical shippers, National Grid and and the the regional Distribution Network Operators (DNO’s). but also the Feed in tariff (FIT’s) small generation customers and CHP and renewable end customer/suppliers. While the smart grid will affect each of these segments in different ways, it will affect all of them by increasing their ability to work together to better serve consumers.

Smart Grid Definition
A smart grid is a modern electric system. It uses communications, sensors, automation and computers to improve the flexibility, security, reliability, efficiency, and safety of the electricity system. It offers consumers increased choice by facilitating opportunities to control their electricity use and respond to electricity price changes by adjusting their consumption. A smart grid includes diverse and dispersed energy resources and accommodates electric vehicle charging. It facilitates connection and integrated operation. In short, it brings all elements of the electricity system – production, delivery and consumption closer together to improve overall system operation for the benefit of consumers and the environment. A smart grid is not only information rich, but also has the analytic infrastructure, processes and trained individuals necessary to integrate and act on information in the very short time frames required by the electricity system. It is characterized by clear standards, security protection and open architecture that allow for continued innovation through the development and deployment of new technologies and applications by multiple suppliers. So OFGEM must get it right, undertaking discussions with both the customer and the electrical supply and distribution network industry community.

Driver’s for a smart Grid

The Goverment’s commitment to establishing a culture of conservation and the desire to reduce the environmental footprint of the electricity sector are major drivers for creating a modern grid. The culture of conservation requires the continual search for new ways to encourage all customers to use energy more efficiently and lower consumption during peak periods. The comprehensive provision of smart meters creates the opportunity for all customers to better understand and manage their electricity usage and, for those who wish, to become active providers of demand response, and be rewarded in doing so.

The prominence of renewable energy in the Governments white papers an increased ability to accommodate variable renewable generation from off shore tidal, wind farms, solar, biomass and micro generation. Where today the grid serves primarily as a vehicle to move electricity generated in large central facilities to consumers, in the very near future, the grid will need to do much more. As the number and distribution of smaller generators grow, Micro generation (FITs) come on line, the operational challenge of incorporating these independent generated energy resources, while maintaining safety and reliability, will also grow. Meeting this challenge will require a smart grid. Other features of this arrangement will also also drive the development of a smart grid. DNO’s will need to upgrade, renew or replace a significant amount of the existing electricity infrastructure network load monitoring and reporting real time demand and quality of supply (similar in some ways to end customer smart meters to be rolled out) In addition dynamic load forecasting to request power stations load demand requirements. This need creates an opportunity to use smart grid technology both to maximize the use of existing equipment and to improve the efficiency of the grid as it is replaced. Growth and redevelopment also present opportunities to introduce smart grid technologies in newly developed and reconstructed areas. Demands by industry and consumers for increased reliability and power quality technology are also pushing toward a smarter grid.

Promise, Cost and Timing Of a Smart Grid
There are many potential benefits from a smart grid in the areas of economics, environment and operating performance. The ability of consumers to increasingly participate in the electricity market by adjusting their demand in response to price or other signals will help to defer the need for peaking resources and incorporate additional generation from variable sources. Improved system economics will come from reduced losses during electricity delivery (line losses) and better use of power station and distribution network plant & equipment. Potential reductions in network congestion will also allow greater use of the most cost effective generation and improve the capacity to move generation throughout the electrical supply network. Greater ability to integrate generation and load can also reduce the cost of operating reserve and some ancillary services. Finally, improved analytics and the ability for the grid to automatically restore itself from faults can reduce the scope and duration of outages, lower operations and maintenance costs, and improve service to customers. Many of the identified economic benefits also have associated environmental benefits. Reduced losses not only reduce cost, they allow more of the electricity generated to reach consumers thereby lowering the environmental impacts from generation. Increased ability to incorporate distributed energy resources, including both renewable generation and demand response, will allow us to move more quickly to a cleaner resource mix that everyone generally wishes to be collectively archive. Even if if it is viewed by some, that this is achieved by someone else. Using existing assets more efficiently can defer the need to expand the grid to accommodate growth. The smart grid offers enhanced operational performance. Greater awareness of system conditions can help anticipate and address problems before they lead to outages, minimize the scope of outages that do occur, and enable more rapid restoration of power. With a smart grid, these fixes may increasingly occur automatically so that the grid becomes self healing.

The ability to remotely monitor equipment condition and performance can also enhance security, help better target maintenance and improve the accuracy of replacement decisions. The information provided by a smart grid also can be used to improve power quality, which is increasingly important in operating today’s sophisticated equipment controlled by digital electronics.

By automating functions that are controlled manually today, the smart grid will increase productivity, which will be essential in managing the more complex grid of tomorrow and helpful in addressing the demographic issues facing the electric system as the baby boomer’s retire and new workers need to be hired and trained. Finally, the smart grid can provide significant operational advantages through its ability to improve both public and worker safety by increasing the amount of system information available for protection and control and by enabling remote operation and automation of equipment. The costs of the smart grid are difficult to quantify. They will depend on investment decisions and the pace of implementation by numerous companies and individuals undertaking smart grid expenditures. It is through the analysis underlying these decisions that the benefits and costs of specific smart grid investments will be evaluated. Certain cost elements that support the smart grid have already been incurred. Ontario’s investment in smart meters and advanced metering infrastructure provide an important connection with customers and the beginning of the communications infrastructure necessary for a smart grid. Additional communications, with greater bandwidth, speed and reliability will be needed, for full smart grid implementation. Moreover, much of the distribution infrastructure replaced over the last few years is already smart grid compatible.

Customer support also would be a key factor in evaluating smart grid investment and customer education will be necessary to inform consumers on this issue. Investment at this level would require increased availability of demonstrated smart grid technology and the human resources to install and integrate it. Finally, the costs and benefits of proposed incremental smart grid investments would be evaluated through appropriate regulatory processes. The timing of smart grid development also will depend on individual investment decisions, which in turn will be influenced by external policy drivers. The investment plans by Electrical shippers, distribution network operators, IDNO’s, meter operators and consumers that will largely determine the pace of adoption for smart grid technologies will be based on their individual needs and circumstances, and their available capital. Government policy, implemented through incentives, mandates or regulatory initiatives will be a major factor in influencing the timing of investments. In short, because the smart grid is not a single project, but rather a series of actions by a variety of entities to modernize the electricity system, it is difficult to produce a definitive time line for smart grid development.

When it does come together, and matures, the system as a ‘whole’, will be more resilient, but it will dependable on all parties being dependable on each other. Including the micro generation and independent supply generation supply contribution and working efficiently, otherwise extra power stations will still be required to be built or available, just in case all independent customers disconnect supplies from the network, say as a future government protest action, interrupting the collective electrical supply contribution factored in the ultimate smart generation mesh smart grid arrangement.

In some respectsit is similar to the how the internet developed and matured and came to be more resilient and depended by everyone including the internet backbone and local ISP’s provide the network grid to connect people and systems together.

Another interesting development will be how supply authorities & DNO’s will undertake works on the network.

For the purposes of this blog, assume in simplistic traditionally engineering supply arrangements, that electricity is generated from a remote power station, distribution via the national grid 132KV network to the local DNO network (66 / 33 /11 / 6.6KV substation network to a 230 V rated supply and so onwards the the end customer via the service cutout consumption monitored by the electrical meter / CT arrangement . Generally, electrical only going one way – Power station via DNO’s to the end customer.

So isolation of cabling & equipment only required from local substation supply to be dead supply to enable major upgrade work to be undertaken.

In comes the Smart grid roll out which end customers are encouraged to provide their own renewable energy, with spare capacity connected and used by local network So introducing multiple back-feed supply’s. Always connected, but independently controlled and managed by the customer, supply on and off all the time – generally individually, each micro generation arrangement not resulting a constant dependable supply contribution, only achieved collectively when provided in clusters of connection points.

So back to the final distribution feeder cable supply requiring major works to be undertaken. DNO isolates at substation and is checked and tested that the LV cable was a ‘dead’ cable, but it could become live at any time, thanks to customers micro-generation connected supply.

So how do you isolate the DNO feeder cable, to cut or repair the cable?

OK – Live working methods can be used and will have to be adopted through the LV network from now on.

But the customers generation equipment will also have to be able to provide circuit protective devices from a grid network earth fault or the remote chance that the distribution point may not be connected to the network. But thats a separate subject, as well!

In a joint up world – simple things get complicated – but systems change and adapt to “keep it simple” – to make it more easier to manage and control.

Renewable energy with smart grid technology – The new complex relationship turning everthing upside down

Saturday, April 3rd, 2010

The energy world is about to turn upside down. With the coming of smart grid, the electricity consumer customer becomes the electricity seller; the passive home appliance becomes the active energy manager; and the local 11KV DNO network becomes the power generation network itself.

Such an upheaval means that the energy world needs to start thinking about a new business model, says a recent report by IBM Global Business Services Energy and Utilities.

The fact that IBM is advising the energy industry is itself a point of interest, yet another signal of the new market opportunity emerging within the energy arena for information technology. This opportunity has drawn the attention of not only IBM, but also CISCO, Google and many others.

So how does IBM see the energy business model changing? First consider what it has been for the last century: a grow-and-build model. Utilities encouraged more and more consumption, and they built power plants and transmission to the far corners of the nation to serve the growing demand.

“The success of this strategy was remarkable. In the United States for example, from 1920 to the mid 1960s (excepting the period of the Great Depression), usage increased at seven percent annually – about five times the rate of usage of all forms of energy combined and three times the rate of economic expansion in general,” says the IBM report, “Switching perspectives: Creating new business models for a changing world of energy.”

But today we no longer need such expansion. The grow-and-build model is obsolete, yet continues to be used by utilities. As a result, utility stocks, which in the 1940s-1960s significantly outperformed the Dow Jones Industrial Average, now lag well behind.

Instead of expanding their territory, utilities are being called upon to change their product — to offer energy that is more efficient and clean and service that is more consumer-friendly.

Smart grid technology can help utilities meet today’s imperative. But it brings with it a new and complex relationship between customer and utility. This is because smart grid allows consumers to control energy usage via a home computer. With smart buildings into the mix and their appliances can control energy usage without the consumer doing anything. And with increased use of solar energy and other distributed technologies, the home also becomes power plant and storage facility for the electric utility.

“Companies willing to tackle industry model innovation and sit at the nexus of new complex relationships among business partners and customers will be well positioned to create and capture new demand for emerging products and services. Strong growth in revenues and profits – albeit accompanied by some risks – is achievable in multisided business models because of the embedded network economies of scale (i.e., margins increase with network size),” says the report.

IBM calls this new business model “a multisided platform.” What does it look like?

“Manufacturers, retailers and shoppers all benefit from having a single location where they can meet and transact business. A wider variety of stores and services brings more shoppers; more shoppers bring higher sales volumes for manufacturers and lower costs for retailers (and, in theory, also lower prices for shoppers). Thus, some element of network economy is bundled into the shopping center value proposition. The platform owner (the shopping center operator) extracts some of this value in the form of rent to store owners and, in some cases, service fees to shoppers,” says the report.

If indeed this is the future, it won’t be embraced quickly or easily by utilities, which are notorious for their caution. For those who do move forward, here is some of what IBM advises.

Be sure your current customer base is sizable enough to ensure that you get a meaningful head start.

But don’t hurry. History has shown that later movers may actually benefit from standing back from the first wave of early adopters.

Time the announcement of your new business model carefully to avoid shocking long-time constituencies or alerting rivals too soon.

But in the UK, the cat has already leaped out of the bag!

The UK Regulator – Ofgem’s duty to contribute to the achievement of sustainable development promoted this duty, placing it on an equal footing with its duties to meet reasonable demand and financing authorised activities. The principle objective, to protect the interests of consumers, refers to future as well as existing consumers. These changes underline Ofgem’s important and developing role in shaping the future of gas and electricity industries in a sustainable manner.The UK is facing a future that involves increased geopolitical risks to energy security, potentially higher energy prices and the need to do much more to reduce greenhouse gas emissions while making sure everyone can afford to adequately heat their homes.

While much of what is needed to deliver sustainability is not within the regulators direct control, a responsibility to facilitate change by engaging in the debate, trying to persuade relevant players to make changes where required and contributing information and expertise where it can.

Actions speak louder than words:

So whats already implemented in the UK?

  • Smart metering (CoP10) with import and export facilities – Coming to every home in the UK – See my blog on smart metering for more information
  • feed-in tariffs (FITs) for small-scale low-carbon electricity generation from 1 April 2010 – Customers own micro energy generation agreements connected to the local DNO grid – See FITs for more information
  • Climate Levy Tax incentives – Look at you next bill and spot this tax!
  • ROC’s – See my blog for more information
  • REGO – See my blog for more information
  • OGEMs – See my blog for more information
  • REC’s – See my blog for more information

The next step:

  • Informing the customer and proving ‘idiots’ guides to understand the available technologies and energy savings available.
  • Providing engineering design  and installation solutions.
  • The correct customer incentives to explore and implements these technologies.

Two more utilities join IBM-backed smart grid coalition

Friday, November 20th, 2009

Two new utility companies have joined The Global Intelligent Utility Network (IUN) Coalition, which is a group formed by IBM that is pushing best practices for smart grid technologies and installations.

The new members are CPFL Energia (Brazil) and Liander (The Netherlands). The four U.S. members (CenterPoint Energy, Pepco Holdings, Progress Energy, and San Diego Gas and Electric) collectively were granted $3.4 billion last month in federal funding for their various smart grid pilots and projects.

The collective mission statement of the Global IUN is to use “digital intelligence” to help reduce outages and faults, manage demand and integrate new sources of energy such as wind into the power grid. The group was responsible for developing the Smart Grid Maturity Model, which is now being used by more than 60 utilities as part of smart grid strategy and planning.