In the Electric Utility Industry, We are Bombarded with Everything Smart Grid. In this column, I'd like to share Utilimetric's vision.

So, what is Smart Grid? Simply put, Smart Grid is moving the electric grid from a “static” to a “dynamic” state. The five key characteristics of the future Smart Grid utility are: two-way communication down to appliances, self-healing ability, customer empowerment, generation choices and capital asset optimization.

The goal is to use advanced information-based technologies to increase power-grid efficiency, reliability and flexibility, and reduce the pace for more electric utility infrastructure. Rebuilding the existing grid to this future state will not happen overnight, and not every utility will carry out Smart Grid the same way. It is a goal to work toward the place we need to be and thus a vision for the electric utility of the future.

WHY NOW?

Utilities face five converging trends today. These trends — a stressed grid infrastructure, global warming, energy costs, customer expectations and technology — form what some describe as a “perfect storm” and are the drivers for change.

The first three are obvious, but the last two need more explanation. While energy costs increase, customer expectations also increase. Customers want to do more to protect the environment, use less energy and control their costs. Also, customers are increasingly technologically savvy and expect to receive the information to help them manage their energy usage. One of the main characteristics of the Smart Grid is enabling customers to manage energy and control their costs.

Probably the most important trend on the list is technology. Advanced metering infrastructure (AMI) deployments are happening on a large scale today. AMI includes two-way communication with every customer, hourly (or more frequent) data, home area network (HAN) communications and even service switches integral to the revenue meters. The cost of AMI meters has dropped to the price point at which automatic meter-reading (AMR) meters were not long ago. Essentially, Smart Grid is not possible without AMI.

IS IT A PASSING FAD?

In the United States, the government views Smart Grid as part of our future energy strategy. In 2007, Smart Grid legislation was passed within the Energy Independence and Security Act of 2007. Title XIII “Smart Grid,” section 1301, establishes a federal policy to modernize the electric utility T&D system to preserve reliability and protect infrastructure.

Further, smartening the grid is similar to the subject of the best-selling book about the changing world called The World is Flat. This book speaks about digital technology advances and their effect on globalization. The author, Thomas L. Friedman, describes how, over the last 15 years, digital technology has changed the world from a vertical “command and control” environment to a level playing field, where the world is “communicating and collaborating horizontally.”

In the same way the world is flattening because of digital technology, the vision of the Smart Grid will result in “The Flattening Utility,” where the utility and customers are communicating and collaborating horizontally. Yet, this transformation has to happen reliably, efficiently and economically.

WHAT DOES IT MEAN FOR MY UTILITY?

The utility systems involved with Smart Grid cross all functions and will fundamentally change the way the utility performs in the future. Utility systems involved in Smart Grid include AMI, HAN, distribution automation, outage management, asset management, distributed resources (including distributed generation) and even efficient circuits. Beyond those systems, the Smart Grid vision will have to address four important questions:

1. How long will it take to get there?
2. How standard and integrated will it be?
3. How much communication bandwidth will be used?
4. And how or who will pay for it?

Answers for these questions will be different for each utility, based on the political environment and economic drivers. The implementation also will vary depending on a utility's specific needs.

Smart Grid is a vision of a digitized, dynamic and secure electric grid. And the grid is quickly evolving today in response to the aging grid infrastructure, global warming, rising energy costs, customer expectations and technology. In the long run, Smart Grid will help to flatten utility-customer communications and transform your utility.

---

David Scott is vice president of Utilimetrics and also serves as a senior consultant at Plexus Research, an R.W. Beck company, where he supports the company in its AMI and Smart Grid vision, decisions and procurement. He has more than 34 years experience in the utility industry, metering, AMR and AMI.
dscott@plexusresearch.com