Telecommunications networks are similar to electricity networks – no one gives a thought to them until they aren’t working as expected.  The network infrastructure to support the data communications requirements of the Smart Grid must be upgraded and expanded to handle additional traffic, and in particular traffic for new market models that need to get the right information to the right device, application, or resource destination at the right time. 

Consider this scenario to identify the scope of future communications network requirements.   TeMIX, which means Transactive Energy Market Information Exchange, is a standards-based architecture and protocol for realtime and forward transactions of electricity products.  It enables decentralized decisions and control at the edge of the network so that devices such as air conditioners, electric vehicles (EVs), and customer generation and storage could automatically interact with the distribution grid. 

TeMIX delivers on the vision of an energy market that brings buy and sell transactions that already occur at wholesale electricity levels down the distribution grid, the retail electricity market.   This brave new world of energy transactions exemplifies the bi-directional flow of electricity and information – which is the simplest definition of the Smart Grid.  TeMIX supports carbitrage – those charge/discharge transactions automatically negotiated based on price and response to special events such as Demand Response.  It also supports transactions that would enable you or me to sell any excess electricity from our rooftop solar panels to a neighbor’s house or EV, or back to a utility.  In other words, it enables the uptake of renewables, energy storage, and EVs with an infrastructure that lets consumers become electricity producers, or prosumers.

There are a number of changes that must occur to make this vision a reality.  Aside from regulatory considerations, this transactive market needs a high speed, scalable, flexible, reliable and secure communications network to support the distributed intelligence to negotiate bids and sales and document activities in realtime.  It needs to provide extremely fast confirmation of transactions and signals back to grid operators responsible for the delivery of electrons.  Fortunately, we have some examples of networks with similar requirements.  For instance, the wireless networks of telecommunications providers are extremely scalable.  They have to be.  When the first generation of cell phones were introduced and networks built to support them, no one expected that future smart phones would be used to view movies, play games, or function as computers.  The networks have to scale up to accommodate new streams of data and proliferating devices.  Banking networks handle high volumes of transactions at ATMs and support deposits, withdrawals, and other requests quickly and securely.  Stock market networks support massive numbers of buy and sell requests and react to dynamic price changes. 

Utility networks can learn from these examples to create the communications networks that will support the requirements of more transactive markets.  Even if we do not achieve the complete vision of TeMIX, these networks will have to be in place to support residential demand response (DR), integrate renewables, enable smart charging, and increase distribution grid reliability.  So, when we talk about the Smart Grid, be mindful that the changes won’t happen just to the electricity network, but to the supporting richly bi-directional communications networks that will help keep all the participants in the electricity value chain connected.  There’s no mystery why Cisco has proclaimed that the Smart Grid will be bigger than the Internet.