Blackouts, More Than Efficiency, Drive Smart Grid growth

We’ve been hearing about the potential wonders of the Smart Grid for several years now. It will save energy, make utility operations more streamlined, support renewables and save money for consumers. All these things are true, and they will be even more important in the years ahead as the impacts of climate change are felt more strongly. But blackouts are happening right now, and they are costing utilities money. That seems to be the primary driver for many power companies to begin investing in technology today.

According to the Energy Information Administration (EIA), power outages cost US businesses $150 billion per year. The number of blackouts has increased 285% since 1984 and their duration, here in the US, is the longest among industrialized countries.

Why is that? There are two reasons. First, there is more power going through our electric grid than ever before. Second, and most important, the grid is getting old.

The U.S. electrical grid, once considered a marvel, is becoming a dinosaur. Going back over 60 years, some of the designs date back to Edison himself. It consists of some 7,000 power plants pushing electrons out over 450,000 miles of transmission lines, to businesses and homes that are interconnected by some 2.5 million miles of feeder lines. According to the Edison Electric Institute, it is worth $876 billion, though the value of what it produces is incalculable.

It was built for a time and a scale when things could be done manually. Meter readers would go from house to house reading mechanical meters, and linemen could inspect the lines to see where repairs were needed. Today, it has become too big and too indispensable for that.

Houston-based CenterPoint Energy oversees some 50,000 miles of power lines. Rather than relying on linemen to search for breaks and downed tree limbs, they have deployed wireless relays that send out transmission data every 15 minutes. The data allows the utility to see the usage from every home they’re connected to, allowing them to forecast demand, as well as finding line breaks as soon as they occur. This is the first stage of an “intelligent grid” pilot that will rely on a network of sensors, switches, smart meters, and data analysis software that will give the utility far more control over the dynamic ebbs and flows of supply and demand, which will ultimately allow them to operate more efficiently. It will also allow them to more effectively integrate renewable sources like wind and solar, dispatching power into the grid or into storage on a moment by moment basis.

CenterPoint is one of many utilities that are investing in smart grid technology with the assistance of Federal dollars. Detroit’s DTE Energy, in conjunction with Tollgrade, is investing $250 million on an outage prediction system that they expect will eliminate half a million outage minutes for its customers over the next three years.

Pecan Street in Austin, Texas in another demonstration project that is attempting to show how the interconnection between utilities and customers can help avoid overbuilding and over-generation.

These are exciting, high-profile projects that are helping to get the word out on how effective these types of interconnections can be. But, digging deeper we find that many utilities are not yet jumping on the bandwagon. Smart Grid Insights recently did a Municipal Smart Grid Survey of 91 utilities in which they found that:

• Smart grid deployment for the largest proportion (42%) of utilities was only in the planning/investigatory stage.
• Managing, storing, and effectively using smart grid data concerned 97% of these utilities (42% were very concerned).
• Most important smart grid application area was smart meters/AMR/AMI (85%).
• Smart grid projects, over the next five years, was most often a moderate priority (47%).
• Over 1/3 (36%) of utilities said no customer outreach has been made.
• Additionally, over half (52%) of respondents said they were not exploring formal renewable energy generation initiatives.

The most common reason given for this lack of participation was budget limitations (44%). The biggest area of concern (77%) for deployment was utility system integration. While each utility is looking after their piece of the pie, there appears to be a vacuum at the upper level where someone needs to be responsible for making sure that all the pieces work together. This would be a natural place for government oversight, perhaps under DOE, but in today’s political environment, it could be difficult to establish such a function.

Article by RP Siegel of Justmeans, appearing courtesy 3BL Media.