Many labels are being used to describe the technical evolution of electric utilities as multiple simultaneous changes are occurring across the industry.
- “Smart Grid” is a term that initially tried to encompass a more customer-interactive utility — with smart meters functioning as a new customer interface providing more information to both the utility and the customer.
- Distributed Energy Resources (DER) include the demand side management (DSM) of energy efficiency, demand management and demand response, as well as distributed generation (DG) and storage, resulting in more customer interaction with their utility.
- “Transactive energy” envisions a future where customers with DER can respond to utility and grid needs in exchange for compensation – essentially a potential model for the dispatch of DSM resources and associated financial settlement.
- The relatively new term in this list is “Grid Modernization,” which recognizes that grid infrastructure changes and upgrades are needed to support the envisioned customer interactive DER model in the future.
At the end of August 2017, the Hawaiian Electric Companies (Hawaiian Electric, Maui Electric and Hawai‘i Electric Light) published their Grid Modernization Strategy with input from both customers and stakeholders. Hawaii has seen explosive growth in distributed generation photovoltaic (DG-PV) systems with nearly 80,000 privately owned rooftop solar systems pushing electricity onto the grid. The combination of utility-scale and customer-owned renewable resources served 26.5% of the Hawaiian Electric Companies’ customer electricity needs in the second quarter of 2017. To progress even further, the Hawaiian Electric Companies have recognized DER as a necessary component to reach the Hawaii renewable portfolio standard (RPS) mandate of 40% of net electricity sales by the end of 2030; 70% by the end of 2040; and 100% by the end of 2045. Therefore, the GMS proposes an Integrated Grid Planning framework to compare solutions and alternatives to address grid needs. However, this is not simply an engineering exercise. It is a collaborative process involving customers, policymakers, regulators, utility stakeholders and solution providers, all of whom are invested in grid modernization results.
Changing Customers
Customer expectations are changing and electric utilities are working to better engage their customers. Based on input received during development of the GMS, customers of the Hawaiian Electric Companies conveyed a basic understanding of how the grid works, a clear understanding of their expectations for a high level of reliability, and some frustration with the slow transition to renewable resources. Customers also identified their needs, which include stable or lower prices; more choices for private rooftop solar, battery storage, and rates; and the societal benefits derived from use of renewable resources. Most customers also understand the connection between achieving the renewable energy goals and the limitations of the electricity grid today. Essentially, customers are in agreement with the Hawaiian Electric Companies’ statement in their Grid Modernization Strategy: The grid we have is not the grid we need.
The Hawaiian Electric Companies are now developing an Integrated Grid Planning (IGP) approach to achieve the future envisioned in the Grid Modernization Strategy through a comprehensive, customer-focused, and cooperative grid planning (C3GP) approach. The IGP approach will further engage both customers and stakeholders to solicit input for grid planning assumptions and scenarios. The future is uncertain, but forecasting is fundamental to grid planning. Soliciting input from customers and stakeholders during the planning process to form the basis of the forecasting assumptions and scenarios will provide insights into trends and needs that may not be foreseen without this collaborative approach.
Infrastructure Needs
Grid Modernization is not only needed to support customer adoption of distributed resources, but also to adopt modern solutions to replace aging infrastructure. Across the country, distribution infrastructure that was deployed during the growth years after World War II is still in service. These components are at end of life and require replacement to maintain safety and reliability standards. Therefore, when replacing assets that are 60 years old that are vital to powering the modern society, incorporating the monitoring, automation and control capabilities available for the modern day equivalent components is both logical and necessary.
The Hawaiian Electric Companies’ GMS summarized both the current state of grid as well as customer technologies as illustrated in Figure 1. Today’s grid solutions include some line sensing capabilities, fault indicators, utility scale renewable generation and utility scale storage. Customers have been quick to adopt technologies including hot water heater demand response, DG-PV and energy storage. The Hawaiian Electric Companies are managing their grids with energy management systems, outage management systems and geographic management systems with SCADA deployed to subtransmission and a majority of distribution substations.
A key component of the GMS is that the deployment strategy is proportional and prioritized to implement “the right pieces at the right time at the right level of risk and cost.” Rather than a system-wide deployment, which was utilized for many smart grid solution deployments across the industry, the Hawaiian Electric Companies will deploy solutions based on known and anticipated grid issues combined with stakeholder input through the IGP process. Essentially, installation of the grid modernization components will be prioritized and deployed to the specific areas of the grid that need them and the deployment will grow and evolve over time. This modular approach to evolving and maintaining the complex distribution grid follows the concept of the grid as a platform that enables applications including distribution management, DER integration and customer programs. The modern solutions will also become the new standard for equipment so that aging infrastructure will be replaced with modern equivalents.
Distribution Challenges
With a high penetration of DG-PV systems, the distribution grid in Hawaii is encountering challenges such as voltage control. Therefore, the Grid Modernization Strategy envisions two fundamental components: 1) fully understanding the grid status in near-real time (situational awareness); and 2) the ability to do something about the problem (distribution automation and control). There are several elements of the GMS that will lead to a much better understanding of the state of the grid and associated distribution circuits in near real-time. Advanced technology solutions for distribution automation such as intelligent switches, fault indicators and line sensors can provide data and control capabilities to optimize the grid configuration with benefits for reliability and outage restoration. For challenges such as voltage regulation, secondary Var controllers, distribution storage, and customer cited advanced inverters can then provide the means to adjust voltage to continue to deliver power within standards. Grid modernization in this context represents an advanced technology platform supporting the convergence of energy, technology, and data to better manage the grid while enabling new products and services to customers.
Figure 2 envisions the future state of technology to support Hawaii’s electric grid with an envisioned future state incorporating advanced technologies and systems for distribution monitoring and control, interconnection of advanced inverters (IEEE 1547) for DG and storage, demand response, and other customer programs to enable more customer interaction. Coordinating the balance of electricity supply and demand becomes more dynamic with increasing reliance on variable renewable generation resources. Therefore, systems and technologies are needed to monitor and control the distribution grid, including telecommunications infrastructure to communicate with the distribution technologies and back office platforms such as distribution management, demand response, distributed energy resource management systems.
The Hawaiian Electric Companies’ December 2016 Power Supply Improvement Plan estimated the investment associated with a traditional infrastructure upgrade approach to support Hawaii RPS goals, and the August 2017 Grid Modernization Strategy estimated the investment needed for the alternative grid modernization approach as summarized in Table 1. Based on this comparison, the Grid Modernization Strategy approach is 32% more cost-effective than the traditional infrastructure upgrade approach over a six-year timeframe. This reduction improves the overall cost effectiveness of the utility investments for all customers while enabling greater customer adoption of DER and large-scale renewables in a progression toward Hawai‘i’s goal of 100 percent renewables.
“Grid Modernization” enhances the customer-utility relationship and can better align customer expectations with utility initiatives. In the case of the Hawaiian Electric Companies, the path to the 2045 100% renewable energy mandate involves prioritized and proportional deployment of sensing and control technologies as a means to upgrade aging infrastructure while enabling the continued growth of utility scale and distributed renewable generation.
Jeremy Laundergan is EnerNex’s Vice President of Consulting Services and assists EnerNex’s client with strategy development, project planning, regulatory engagement, economic analysis, lifecycle management and technology assessment including considerations for renewable generation and distributed energy resource integration. Jeremy is an award-winning project management professional (PMP) with over 25 years of experience and a master’s degree in engineering management.
