A Primer on the Smart Grid and Intelligent Utility Network Trend

Smart Grid2 In a world where increased focus is on reducing CO2 emissions, governments and energy & utility companies are looking for ways to modernize and transform their utility infrastructure in order to improve energy efficiency and reliability. 

For developed economies, the traditional way power has been generated is based on a central generation model with one-way power and information flow from large, often distant generating stations, via transmission and distribution lines to end consumers.   Most of these generation systems contain an aging infrastructure with some equipment dating back 60 years.  This traditional infrastructure lacks sufficient technology and communications at the distribution and end-use level that would enable grid automation & monitoring capabilities.   The model has been a push model, meaning that there is little to no automated information coming back to the central sites from those that use the power.  So if the user suddenly has no power, the only way the utility company knows about it is if they get a call from the users.  Furthermore, the user has very little information available to help them understand how much power they are using, when they are using it, and what they are using it for.

The Smart Grid (also called Intelligent Utility Network) technology is an important emerging trend within the Energy and Utility Industry.  As consumers, we are increasingly aware that the way we consume and save energy can be improved.  Within the energy and utility industry, energy efficiency is also on the minds of the industry leaders.  And our governments are all interested in finding new sources of energy.   By embedding technology into the electrical distribution network, a Smart Grid can transform the way power is distributed and used.  Intelligence throughout the grid can dramatically reduce outages and faults, improve responsiveness, handle current and future demand, increase efficiency and manage costs.

The following video from IEEE will provide some additional introduction into the concept of the Smart Grid.

Produced by IEEE and ScienCentral, Inc.

A Smart Grid can present many opportunities for consumers, businesses, and utilities to benefit from the efficient distribution of energy and availability of intelligent equipment and devices.  For governments, it offers significant opportunities to wisely manage a country’s fuel resources by potentially reducing the need for additional generation sources, better integrating renewable energy sources into the grid’s operations, reducing outages and cascading problems, and enabling users of power to better manage their energy consumption.

The Smart Grid technology will enable energy customers to

  • manage electricity consumption to meet specific household/business goals such as cost, availability, and environmental impact
  • seek energy providers, information, and technologies that help them meet their goals
  • do business with utility companies who communicate a set of energy-related values consistent with their own
  • seek convenient and more personalized ways to interact with their utility to negotiate customized solutions to allow them to meet their needs
  • act on their own wants and needs where regulatory representation does not provide results satisfying these specific needs, primarily through execution of alternative solutions (e.g., self-generation)

So what exactly are the characteristics of a Smart Grid?  The US Department of Energy has characterized a smart grid as having the following attributes:

  • Self-healing from power disturbance events
  • Enabling active participation by consumers in demand response
  • Operating resiliently against physical and cyber attack
  • Providing power quality for 21st century needs
  • Accommodating all generation and storage options
  • Enabling new products, services, and markets
  • Optimizing assets and operating efficiently

The consumer of power from a future Smart Grid will see many differences as a result of adding intelligence into the network.   Some examples are:

  • Smart electricity meters, water meters, and gas meters that collect real-time data on utility usage.
  • Distributed generation, such as solar panels and other micro generation.  These new generators could be located at the home, in the neighborhood, or in the local community.
  • Dedicated energy display units and smart thermostats that provide the user with feedback on energy usage in real-time.
  • Smart appliances with connectivity to the intelligent utility network via the in home meters and display units.
  • Plug-in vehicles as a both source and consumer of energy.  The vehicles, when plugged in would provide information on energy usage.
  • Linked connection to the in-home network and home PCs for further analysis of all the information collected.

The Smart Grid transformation is much more than installation of new technology in a piece-part fashion.  The call for the transformation to a Smart Grid impacts every part of the utility infrastructure including generation, distribution, and usage.  It will be a disruptive change, but a change that will provide huge rewards for the future.  For the utility industry itself, changes needs to happen in four key areas:

  1. Strategy.  We need a  fundamental rethink of business strategy and industry business models across the board.
  2. Collaboration.  Utility providers will need to develop a much closer collaboration with customers, regulators, financers, researchers, technology and service vendors, and other stakeholders than ever before.
  3. People.  The change will be very disruptive to utility companies.  They will need a renewed focus on staff, their roles, competencies, compensation, performance and structure.
  4. Process.  Utility providers will need to re-architect business processes and applications.

There is much work to be done to transform old utility infrastructures to a Smart Grid system.  The transformation will not happen overnight, but could happen over a series of decades.  When complete, countries that transform their utilities infrastructure to an Intelligent Utility Network will have a modern network of sensor-based interactive technologies that will give utilities and consumers unprecedented control over managing energy use, improving energy grid operations, and significantly reducing energy costs. 

There is a ton of information available on Smart Grids.  Here are a few example resources for you to explore….

For other “Primers” here on HorizonWatching, check out http://horizonwatching.typepad.com/horizonwatching/primer/

IDC Insights: 10 Predictions for the North American Utilities industry

 IDC Energy 2010 PredicitonsIDC Energy Insights held its webinar “Top Ten Predictions for the North American Utilities Industry” today.   Rick Nicholson, Vice President of Research at IDC led the call.

During the call the analysts reviewed the important driving forces impacting impacting technology investment within the Utilities Industry for 2010.   Driving forces include energy efficiency and demand response programs, smart metering and the smart grid, renewable and distributed energy and other relevant technologies.

IDC mentioned that energy usage is expected to rebound in 2010 after a down year in 2009 which had an impact on industry-wide revenues.  Also, investments in cleantech is expected to rebound as access to credit improves in 2010.  A big factor in that will be the American Recovery and Reinvestment Act of 2009.

Here’s my summary of the top ten predictions reviewed on the conference call:

  1. Energy Efficiency and Demand Response:  will continue to be the “first fuel” choice for electric utilities
  2. Renewable Energy:  Renewable capacity additions will exceed natural gas plant additions
  3. Energy Storage:  Utility-scale stationary energy storage will have its coming out party
  4. Intelligent Grid:  North American intelligent grid ICT spending reaches $18 billion by 2013
  5. Electric Vehicles:  First wave of electric vehicles and accompanying charging infrastructure will emerge
  6. Energy Commodity Trading:  Trading of energy commodities requiring IT support will recover and grow
  7. Sustainability:  Traditional generators will focus on managing their portfolio for sustainability
  8. Water Management:  Scarcity of clean water and availability of new technology will awaken the sleeping water market
  9. Smart Cities:   Smart cities will emerge as proving grounds for the intelligent economy
  10. IT Spending:  U.S. utility industry IT spending growth will accelerate dramatically

I remember back in the 90’s this industry was one of the lackluster (perhaps boring?) industries to be involved with from a technology perspective.  Nothing was really happening back then.  Today it is 180 degrees opposite.  There is so much going on right now to bring technology to this industry.  This is one exciting industry today….and I expect it will be that way for another decade or two.

For more information, IDC Insights has a bunch of resources for you.

Ten Emerging Trends

Here's a quick run down of 10 emerging trends I am curious about. 
  1. Smart Healthcare Payment Systems:   Managing health care payment through small personal devices, such as smart cards.
  2. Real-time Translation Services:  Translation in major languages as a service for the health care, government, travel and transportation industries.
  3. Simplified Business Engines:  Developing and marketing an easy-to-use and prepackaged set of Web 2.0 services and blade servers that allow small and mid-size businesses to tap into custom applications.
  4. Intelligent Utility Networks: Increasing the reliability and manageability of the world's power grids by building in "intelligence" in the form of real-time monitoring, control, analysis, simulation and optimization.
  5. 3D Internet:  Partnering with others to take the best of virtual worlds and gaming environments to build a seamless, standards-based 3D Internet – the next platform for global commerce and day-to-day business operations.
  6. "Digital Me":: Creating a secure, user-friendly service that simplifies storage, management and long-term access to personal content (digital photos, videos, music, health and financial records, personal identification documents, files, etc.).
  7. Branchless Banking for the Masses:  Enabling existing and new financial institutions to profitably provide basic banking services (checking, savings, payments, microlending) to remote, inaccessible populations in fast-growing emerging markets.
  8. Integrated Mass Transit Information System:  Establishing systems for integrating, managing and disseminating real-time data for all of a municipality's or region's transit systems, optimizing buses, rail, highways, waterways and airlines.
  9. Electronic Health Record System:  Creating a standards-based infrastructure to support automatic updating of, and pervasive access to, personal health care records and the integrating of patient data with transaction systems.
  10. "Big Green" Innovations:  Starting a business unit in IBM that will focus on applying the company's advanced expertise and technologies to emerging environmental opportunities, such as advanced water modeling, water filtration via nanotechnology and efficient solar power systems.

All of these ideas are interesting to me, however my favorite idea is #5.  Having been in Second Life now since last September, I realize the potential of virtual plaforms to the future of business. 

Now that I've identified these 10 emerging trends, I will be integrating these topic areas into the research I do for this blog.   If any of you reading this blog have material on the above topics please let me know.  AND…if you have any ideas on a subject matter experts I could contact on these subjects…please email me!!!!