The Smart Grid: Deconstructed and Demystified

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Nov 15, 2013 (3 years and 9 months ago)

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The Smart Grid:

Deconstructed and Demystified

Christine Hertzog

Managing Director

Smart Grid Library

www.SmartGridLibrary.com


September 2009

© Smart Grid Library

1

Guilty or Not Guilty?


Do you turn on your kitchen sink faucet, then leave for
the day?



Do you leave your car idling all night in your garage?



Do you leave lights and computers on, and all
charging devices plugged in all the time?

2

Why is electricity held in low esteem?


Because it is always there


Because it is cheap


Because we treat it like a commodity


Because we ignore it unless

THE LIGHTS GO
OUT!!

3

Northeast Blackout of 2003

Causes


Lax tree
-
trimming


Software bug


Human error

4

Agenda


Today’s Grid


Smart Grid Overview


Players


Funding the Smart Grid


Evolutions and Revolutions


Smart Grid Top Ten Trends

5

Today
’s Electrical Grid


Energy flow in one direction, from generation to consumer
(residential or C&I)


Information flow in one direction from meter to utility


manually read by a meter reader or transmitted information
back to the utility

Generation

Transmission

Distribution

Home/

Office


Energy


Information

6

It’s not a National Grid

7

High Reliance on Fossil Fuels


259 GW (2,590 MW) of new
generating capacity
-

equivalent to
almost 2 million homes
-

will be
needed between 2007

and 2030


EIA Annual Energy Outlook


Local utilities rolling out smart
meters and demand response
programs


Peak power demand may
outstrip current supply in 5
years


First new transmission line in 25
years


MidAtlantic Power
Pathway

8

Highly Fragmented Market


ISO/RTOs (Independent
System Operators/Regional
Transmission Organizations


Federally
-
regulated entities
coordinate regional
transmission and markets


May be intrastate or
interstate


Create level playing field for
alternative energy sources


Ex: PJM


Forecasts energy needs


Monitors wholesale markets


Operates reliability markets to
accommodate unexpected
changes in electricity supply


Wholesale power markets
trade short and long
-
term
power contracts


Power marketers include all
energy sources


coal, gas,
nuclear, solar, etc.


Register tariffs with FERC

to sell wholesale power


Electricity derivative markets


Futures and options


3200 IOUs, municipals, and

co
-
ops that buy and distribute
electricity


9

Agenda


Today’s Grid


Smart Grid Overview


Players


Funding the Smart Grid


Evolutions and Revolutions


Smart Grid Top Ten Trends

10

Smart Grid 101

It includes software and hardware applications for dynamic,
integrated, and interoperable optimization of electric
system operations, maintenance, and planning; distributed
generation interconnection and integration; and feedback
and controls at the consumer level (from the Smart Grid
Dictionary).


The Smart Grid is a bi
-
directional
electric and communication network
that improves the reliability, security,
and efficiency of the electric system for
small to large
-
scale generation,
transmission, distribution, and storage.


11

Tomorrow’s Smart Grid


Energy flows in many directions, from generation to grid or
building, from car to/from building, from utility to customers,
from customers to utility


Information networks established to create
secure communications between devices and
people

Generation

Transmission

Distribution

Home/

Building

Distributed

Generation

& Storage

12

Smart Grid Benefits

The Smart Grid will:


Reduce CO
2

emissions by

up to 480 MMT by 2020


Save up to $35B in energy

and fuel costs

(Smart2020.org report on information

and communications technologies)


Lower rates? No


Lower bills? Yes


13

Regulatory Agencies Influence Smart Grid
Definition and Deployment


Federal Energy Regulatory Commission


Oversight of interstate and wholesale electricity rates


Works with ISOs

FERC


Department of Energy


The Smart Grid money machine


Involved in standards via NIST


North American Electric Reliability Corporation


Not a governmental entity, but with mission to ensure
reliability of the bulk power system in North America


Proposes standards for reliability that are reviewed/
approved by FERC

DOE

NERC


Federal Communications Commission


WAN to HAN focus


Licensed, unlicensed, and wireless spectrum

FCC

14

States Also Impact Smart Grid Plans

PUC

Energy

Commissions


Public Utility Commissions


Manage investor
-
owned utilities like Pepco


Approve rates for electricity/gas, etc.


Referee in fight about who owns energy use data


Energy Commissions


Roles vary in states


Ex: California Energy Commission responsibilities


Energy policy and planning agency


Sets appliance and building energy efficiency
standards


Provides incentives for renewable energy


15

Legislation Impacts on the Smart Grid


Waxman Markey (ACES)


Emissions activity already
spurring utility plans and
investments


Wyden (STORAGE)


Provides an investment tax
credit for energy storage
assets


American Clean Energy
Leadership Act (ACELA)


Distributed generation,
transmission siting and
deployment



EPACT2005


Lighting and appliance
efficiency standards


EIEA2008


Renewable energy tax credits


EV tax credits



The biggest complaint in Silicon Valley?
The fits and starts of investment tax
credits, production credits, and incentives
make it impossible for investors to truly
understand and calculate risks and
potential ROIs. All start
-
ups are told to
not use assumptions about government
incentives in their business cases.

16

Federal Money Trail


American Recovery and Reinvestment Act fueling $83
billion into clean tech sectors


Energy efficiency grants and investments for government
buildings, HUD dwellings


Home weatherization


Renewable energy loan guarantees, wind tax credits
extended


Electricity transmission and smart grid (3,000 miles of
transmission lines and 40 million smart meters)


Clean tech tax expenditures (including renewable energy
credits)


Carbon capture research


Vehicle battery loan guarantees and grants for R&D

$83B

$12B

$5B

$6B

$11B

$21B

$3.4B

$2B

17

VC Money Trail


Energy policy is spurring venture capital and public
investment


Venture capital clean tech investment


$4.1 billion in 2008
, up 54% from $2.7 billion in 2007


The recession toll: VC funding fell by 14% in the fourth
quarter of 2008


Tops
$1.6 billion

in 2009 (thru July) for about 100 deals


The
top seven VC investments in 2008 were in clean tech


Sectors include Smart Grid software applications,
geothermal companies,
pollution and
recycling
technologies,
and
transportation (EV and batteries)

18

Agenda


Today’s Grid


Smart Grid Overview


Players


Funding the Smart Grid


Evolutions and Revolutions


Smart Grid Top Ten Trends

19

Electricity Supply Chain


Now

Generation

Transmission

Distribution




Say Good bye to these three silos

20

The Supply Chain Evolves

Generation

Transmission

Distribution

Consumption



Consumption is a new and critical Link
in the Supply Chain


Traditional Grid

Smart Grid Enhancements

21

The Smart Grid Relies on Storage

Generation

Transmission

Distribution

Consumption

Storage

Utility
-
scale


Compressed air


Flywheels

Utility
-
scale


Flywheels


EC Capacitors

Substation
-
scale


Molten salt


Flow cells

Residential
-
scale


Electric vehicle


Home battery

Traditional Grid

Smart Grid Enhancements

Energy Storage technologies underpin centralized and
distributed generation

22

The Smart Grid Changes Generation

Generation

Transmission

Distribution

Consumption

Storage

Utility
-
scale


Compressed air


Flywheels

Utility
-
scale


Flywheels


EC Capacitors

Substation
-
scale


Molten salt


Flow cells

Residential
-
scale


Electric vehicle


Home battery

Technology


Utility
-
scale
renewables

Regulatory


Decoupling


Feed in Tariffs

Players


New power
producers

Traditional Grid

Smart Grid Enhancements

23

Transmission Impacts


Big but Mostly
Invisible to End Users

Generation

Transmission

Distribution

Consumption

Storage

Utility
-
scale


Compressed air


Flywheels

Utility
-
scale


Flywheels


EC Capacitors

Substation
-
scale


Molten salt


Flow cells

Residential
-
scale


Electric vehicle


Home battery

Technology


Utility
-
scale
renewables

Regulatory


Decoupling


Feed in Tariffs

Players


New power
producers

Technology


Superconductivity


Synchrophasors


HVDC

Regulatory


Interstate trans
-
mission agency to
build lines?

Players


Transcos

Traditional Grid

Smart Grid Enhancements

24

Distribution Becomes Bi
-
directional

Generation

Transmission

Distribution

Consumption

Storage

Utility
-
scale


Compressed air


Flywheels

Utility
-
scale


Flywheels


EC Capacitors

Substation
-
scale


Molten salt


Flow cells

Residential
-
scale


Electric vehicle


Home battery

Technology


Utility
-
scale
renewables

Regulatory


Decoupling


Feed in Tariffs

Players


New power
producers

Technology


Superconductivity


Synchrophasors


HVDC

Regulatory


Interstate trans
-
mission agency to
build lines?

Players


Transcos

Technology


Smart meters


Distribution
automation


Microgrids

Regulatory


Zoning to allow
storage

Traditional Grid

Smart Grid Enhancements

25

Major Changes in Store for End Users

Generation

Transmission

Distribution

Consumption

Storage

Utility
-
scale


Compressed air


Flywheels

Utility
-
scale


Flywheels


EC Capacitors

Substation
-
scale


Molten salt


Flow cells

Residential
-
scale


Electric vehicle


Home battery

Technology


Utility
-
scale
renewables

Regulatory


Decoupling


Feed in Tariffs

Players


New power
producers

Technology


Superconductivity


Synchrophasors


HVDC

Regulatory


Interstate trans
-
mission agency to
build lines?

Players


Transcos

Technology


Smart meters


Distribution
automation


Microgrids

Regulatory


Zoning to allow
storage

Technology


HAN


HEMS


Smart appliances

Regulatory


Net metering


FiTs

Players


Energy
-
efficiency
consultants

Traditional Grid

Smart Grid Enhancements

26

A Revolution is Ongoing


Remember how the telecom industry looked and acted
twenty years ago?





Be prepared for big changes to your

relationship with electricity!




27

Agenda


Today’s Grid


Smart Grid Overview


Players


Funding the Smart Grid


Evolutions and Revolutions


Smart Grid Top Ten Trends

28

Top Ten Trends

#1


The Smart Grid will dramatically increase renewable
energy sources for utility
-
scale and distributed
generation

From this

To this

29

Top Ten Trends

#2


NIMBY, BANANA, and NOPE will kill or delay many
remotely
-
based renewables generation projects

Existing transmission assets must be upgraded to transport
the maximum KV amounts on them

30

Top Ten Trends

#3


Security standards will guide protocols, processes and
procedures, but mistakes will occur, creating new
cottage industries for consultants, lawyers, and hackers


Issues


Privacy of consumer information


Ownership of energy data


Physical and cyber security


Liability for breaches and failures

31

Top Ten Trends

#4


Distributed generation facilities will be built using
renewable energy sources and storage for onsite
consumption and for resale back to the grid

32

Top Ten Trends

#5


Energy will be stored at many points on the grid,
including rolling batteries (EVs and PHEVs),

home batteries, as well as utility
-
scale storage

33

Top Ten Trends

#6


Us ordinary folks will engage in energy arbitrage, using
intermediaries to manage interactions with utilities

#7


Cars become income generators for their owners
--

carbitrage



EVs and PHEVs will not lose value the minute they are
driven off the lot

=

34

Top Ten Trends

#8


Energy efficiency
-
enabled devices will proliferate in
homes


my home will be smarter than I am!

#9


HEMS applications will control appliances to save on
energy bills

35

Top Ten Trends

#10


Multiple options for your home control device and
application

What will be the most popular in
-
home
display device?

Internet TV?

36

And One Very Real Threat


If we are not very aggressive in objectives and pace, China
will leapfrog the USA in Smart Grid technologies and
deployments


No need to protect stranded assets or vested interests


Build from scratch using the latest/greatest technology


Largely unified market structure, unlike USA with 3200+
utilities, 50 PUCs, 10 ISOs/RTOs, 4 major Federal
entities, and excessively combative inhabitants


It’s telecom all over again……

but with a lot more complexity

37

We Can Win This Horse Race


Good start with Federal initiatives on standards and
funding


Can’t get derailed on political arguments about whether
global warming is real


Focus on innovations in
technology and regulations


For a truly level playing field,
stop subsidies to established
fossil fuels


Remember to keep the
consumer (end user) in mind

38

Thank You!


For help with the terms and acronyms in this presentation,
get the Smart Grid Dictionary, First Edition, at the website
below or at Amazon.com



For more information, visit:
www.smartgridlibrary.com


or contact Christine Hertzog

at chertzog@smartgridlibrary.com