The Smart Grid Dictionary defines the Smart Grid as:  A bi-directional electric and communication network that improves the reliability, security, and efficiency of the electric system for small- to large-scale generation, transmission, distribution, and storage.  It includes software and hardware applications for dynamic, integrated, and interoperable optimization of electric system operations, maintenance, and planning; distributed energy resources interconnection and integration; and feedback and controls at the consumer level.  Emphasis is deliberately placed on software applications to highlight the tremendous potential that management and analytics software holds in this synergistic technology triad.   For instance, realtime monitoring of solar arrays – whether in distributed, small kilowatt rooftop installations or utility-scale (large megawatt) deployments can produce vast amounts of data about voltage and currents.  Software applications can use this data to optimize management of these assets in the field.  Transmission or distribution network operations managers could also see the exact amounts of power flowing from these renewable sources of energy, and react to fluctuations caused by weather, component failures, and planned maintenance.   These reactions could include realtime, software-based control of energy storage assets that could inject the required amounts of power to eliminate fluctuations in bulk power or distribution grids.  The energy storage assets can supplement power for limited or extended time frames, involving flywheels, pumped hydro, or zinc air batteries, just to name a few of the technology options coming into the market.

However, the reliance that the Smart Grid places on clean and distributed renewables requires some fundamental changes in our thinking about grid operations.  Grid management can become more decentralized with distributed software intelligence and business rules based on analytics automating decisions to modulate transmission and distribution grids with much more granularity than currently practiced with today’s technologies and techniques.  Automated decision-making through established operational business rules and realtime analytics would help ensure the reliability of transmission and distribution grids.  This means that as coal-burning generation plants are retired, these reliable but dirty sources of power can be replaced with clean renewables coupled with energy storage that can guarantee similar expectations of consistent power.  

Beyond these ongoing grid management activities in operations centers, data can be analyzed to determine component performance in renewable sites.  Analytics reports can identify if certain inverters or feeders are out of compliance with negotiated Service Level Agreement (SLA) metrics so that asset owners could take corrective actions with contractors.  Analytics will also play key roles in simulations and modeling of various scenarios.  What if a wind generation facility experiences an unusual amount of wind gusts?  What impacts could a wildfire trigger in power generation output from nearby solar facilities – how much energy storage should be configured to ensure reliable power flows?  These scenarios can be simulated and operational responses can be documented and automated with relevant business rules and processes. 

There are many other intriguing possibilities for software applications in the Smart Grid, and these will help the electrical system evolve into a much more distributed and dynamic collection of networks and assets.  It’s time for software developers to consider how they can leverage the synergies of renewables generation, energy storage, and software and accelerate Smart Grid deployments.

Similarly, renewables-based generation, energy storage, and grid analytics/software are the three sisters of the Smart Grid – leveraging the synergies of their technologies to achieve greater reliable electricity yield than each technology could independently produce.   These three technologies can deliver their combined benefits for utility-scale generation as well as distributed generation and microgrids.  

Renewables, the first sister, are categorized as intermittent or steady-state sources of electrical energy.  Wind and solar are intermittent.  Geothermal and hydro (in most cases) are steady-state.  While steady-state is easier to manage, it’s not as well-distributed or readily accessible for most countries.  Solar and wind have distinct advantages in the fact that the sun shines everywhere and the wind is usually not too picky about where it blows.  Solar has great flexibility in where it can be placed –rooftops everywhere can be potential sites for distributed generation.  But intermittency is a vexing problem for planners and grid managers because it is vital to grid health to minimize fluctuations of energy.  Clouds passing over solar panels or temporary drops in wind create those fluctuations.  This is where the second sister comes into play. 

Innovations in battery technologies are transforming energy storage into cost-competitive solutions that partner well with intermittent renewables like wind and solar to deliver steady state power.   There are new technologies that overcome concerns of energy density, flammability, toxicity, and achieve grid-parity pricing.  Energy storage is the second sister of the Smart Grid.  Stationary and mobile (EV) forms of energy storage can play significant roles in utility scale and distributed generation utilizing solar and wind, because it can be deployed to smooth out temporal or weather-based fluctuations.  Renewables and energy storage deliver a potent synergy, but a third sister is needed to help manage these assets as they are integrated into transmission or distribution grids.

Grid analytics and grid management software are needed to manage increasing numbers of renewable generation and energy storage assets.  Utilities are building out IP-enabled networks to accommodate bi-directional communications, and this activity opens up opportunities for remote realtime monitoring and management of these new assets anywhere in the grid.   Realtime management of dispersed assets needs software to organize grid management activities.   It also requires analytics to provide proactive intelligence about conditions and predictive performance of grid networks and devices.  Grid analytics and management software enhance the reliability of electricity on the grid – a valuable synergy with renewables and energy storage. 

These technologies will accelerate the delivery of the benefits of the Smart Grid, but today exist as separate solutions.  Could a three sisters solution for the Smart Grid be the next brilliantly synergistic American innovation?  Like the Native Americans of the past, system integrators who specialize in distributed generation and microgrids can play a key role in creatively combining these technologies into solutions that fully leverage their synergies.  These solutions could also be exported globally to address developed and developing world energy needs.

What has prevented energy storage from playing a bigger role in the Smart Grid and being coupled with renewable sources of electricity?  There are two reasons – technology and price.  Energy storage technologies are experiencing a transformational boom, in part due to the Department of Energy’s Advanced Research Projects Agency – Energy (ARPA-E) focus on innovative breakthroughs for electric vehicle (EV) batteries.  Grid-scale energy storage solutions are also benefitting from new interest and investment, and are poised to challenge traditional energy storage solutions.  For example, traditional pumped hydro harnesses the energy of water running downhill to spin turbines and generate electricity, and then uses cheap, off-peak electricity to pump that water back to the top of the hill for reuse.  But pumped hydro requires very select conditions – a ready supply of water, a steep hill, and the willingness to invest a billion dollars or so into a generation plant and transmission facilities. 

And then there is price.  Many energy storage technologies simply couldn’t compete with fossil fuels – although the negative externalities of CO2 and human health were not factored into these calculations to deliver true costs.  But now there are new energy storage technologies that can cost-competitively store electricity.  One interesting technology takes the common zinc-air battery, which is today used as a disposable battery for hearing aids, and makes it a high energy density and rechargeable energy storage option.   What is most intriguing about zinc-air technology is what it is not – it is non-toxic and non-flammable, two attributes missing in some energy storage technology alternatives.  Another positive attribute is the price point – it can achieve “grid parity” with natural gas. 

One company that is focused on zinc-air is Eos Energy Storage, an east coast startup.  Eos intends to sell their grid-scale product at $160 per kWh, which is one fifth the cost of a lithium ion battery system, according to Steve Hellman, president of the company.  This price means that their grid-scale batteries would compete with gas-fired turbines to firm renewable power and ancillary services like frequency regulation.   Since zinc-air technology is environmentally benign, it could easily be situated for distributed energy storage purposes in residential neighborhoods without complications of zoning for toxic or flammable substances.  Distributed energy storage avoids the need to build expensive transmission facilities.  This technology would also be welcome in substations because it would not introduce new safety risk factors for workers.  In addition, zinc is readily available in the USA.   Given our current energy and economic insecurities caused by a reliance on imported fossil fuels, we should look to domestic clean sources of energy and materials and leverage natural synergies between renewables and energy storage to speed their integrations into the Smart Grid.

2.  The recent Federal Energy Regulatory Commission (FERC) decision defines regional planning processes, outlines rules for fair cost allocation, and delivers market certainty for transmission companies and renewables developers that will speed renewables integration and concomitant energy storage deployment. It requires that transmission planning processes include regional policy considerations such as state renewable portfolio standards and Environmental Protection Agency (EPA) standards.  This decision also removed the “right of first refusal”, which discouraged cost-competitive transmission facilities development.  Utility-scale renewable projects such as wind farms and large solar deployments are often far from the points of consumption, and transmission lines will need to be built.  Energy storage should be a natural component of wind and solar projects to ensure firm power to the grid and the ability to participate in new markets.     

3.  The Electric Power Research Institute (EPRI) released a recent study to help utilities develop functional requirements for energy storage to aid in integration of renewable energy sources as well as energy storage at substations and within the electrical distribution networks.  Current work is now focused on similar recommendations for energy storage on the customer side of the meter – micro-scale energy storage that can be coupled with rooftop solar generation.  This means that utilities are taking serious looks at moving from current “always-on” forms of generation to time-shifted generation supported by energy storage, and considering that intermittent renewables like wind and solar can be coupled with energy storage technologies. 

The wild card that will soon be played is the mounting concern about fracking and the impacts to water and air quality and the true costs of these environmental externalities.  Texas, known for its casual attitude toward environmental protection, became the first state through passage of HB3328 to require that drilling companies that engage in hydraulic fracturing or fracking must disclose all “intentionally-used” chemicals that are introduced into the ground as part of their extraction processes.  Of course, the disclosure of incidental, accidental or unknown ingredients is not required, but it’s a significant step that will put a much needed spotlight on industry practices.  The cheap price point of natural gas may not look so attractive if it comes at the expense of potable water, which is in finite and stressed supply on this planet.  If natural gas loses some of its appeal, that will increase the demand for renewable sources of generation, and the need for energy storage.

 Energy storage is finally getting the attention it so richly deserves in the Smart Grid, and it will become a widely deployed technology in many form factors across the entire electricity supply chain consisting of generation, transmission, distribution, and consumption.

Those specific conclusions focus on how organizational culture frames internal communications and deployment of new technologies. As the report noted, it is “difficult to capture the full spectrum of factors that make an organization unique, such as history, hierarchy, mission, leadership, experiences, attitudes and values. “ But utility and regulatory cultures must change into innovation cultures to plan and manage the transformations that Smart Grid technologies and services can play in the electricity value chain to benefit consumers and society.

First, the silos that are common to most utilities can impede successful deployment of Smart Grid technologies. Several panelists at the Electricity Storage Association conference in San Jose last week pointed out that energy storage challenges the traditional utility classifications (silos) of generation, transmission, and distribution. Depending on the type of storage technology and application, it can be considered time-shifted generation, or a service to bolster power quality for transmission purposes, or a distribution asset to improve reliability, or a mobile battery for geo-shifted generation. Pity the energy storage vendor with a solution that crosscuts silos. Both utilities and their regulators must take care to not use siloed thinking about innovative technologies or solutions – they must think on a bigger, broader scale of what safe, reliable, and cost-effective electricity means and not in the context of limited applications for a single link of the electricity value chain.

Second, investing all organizational energy into emerging technology deployments without concomitant process, policy, and people changes is a sign of pending doom for project success. It’s like slapping fresh paint on a termite-riddled house – ignoring the structural weaknesses undermine the results of the paint job. It’s a common trap across all types of businesses. Experienced project managers will tell you that technology deployments are easy compared to planning and implementing organizational change.

Change management can facilitate cultural change. It is a necessary component to any successful Smart Grid project, and vital to any project that has visible or disruptive impacts to consumers. Business research shows that the most common reason for failure of major projects is the lack of change management plans that build internal consensus and support. Managing change within a utility requires an in-depth communications plan and targeted messages that are delivered at all organizational levels in all functional areas. Successful Smart Grid projects must also extend communications to external audiences – consumers- as well, to educate and enlighten them about the short and long-term benefits of new technologies or services. “Trust us” is not a communications strategy. Regulatory agencies must recognize the value of cultural change and support utility change management and communications activities as necessary steps to successful Smart Grid initiatives.

We’ll discuss tactics in a webinar on June 21 about change management and communications about Smart Grid benefits to internal and external constituencies. Join us to learn more about transforming operations to support innovation cultures.

We can expand the integration of Smart Grid technologies even further into school districts, and into making money, not just saving money.  Smart Grid technologies enable the electrification of transportation, and can leverage the energy storage capabilities of electric vehicle (EV) batteries in smart charging scenarios.  Most schools have school bus fleets that operate on very predictable times of use with very predictable ranges.  If school buses operate on electric power, they can charge up directly from the school’s own solar facilities, and because this would be a DC (direct current) to DC charge, optimize that charge and avoid the loss of electricity experienced in a DC to AC (alternate current) conversion.  During the school year, the buses can charge using the power that is generated from school solar facilities, or charge at night when local utility rates are lowest.  The bus fleets can also drive revenues for school districts in two ways.  During the school year, the fleet batteries can be used to provide frequency regulation services for region-wide grid operations.  During the summer recess, the fleet batteries can serve as resources to discharge energy during peak demand periods for local utilities, in addition to supplying the electricity from solar panels.  That’s definitely a win for the taxpayers supporting school districts.

The benefits go even further.  We have a dire need to develop a workforce to fill positions ranging from R&D in renewable technologies, EVs, and energy storage to installation and maintenance of solar facilities, vehicle charging hardware and software, and energy management solutions.  School districts can be living laboratories for students – familiarizing them with the state of the art technologies and readying them to pursue careers in distributed generation, renewables, software, hardware, regulatory policy, and economics.  The educational possibilities extend into awareness of energy use to create engaging social media-based applications that enable energy efficient behaviors, as well as creating technologies that minimize their use of electricity.    

What is required to make this dream scenario a reality?  Enlightened regulatory, legislative, and voter actions at the local and state levels would encourage the rapid proliferation of relevant renewable technologies and EV bus fleets in school districts, stimulating local job growth and setting up the next generation of workers in skilled trades and high-tech sectors.  Changing regulatory policies to allow school districts to participate as electricity providers is required.  The school district that is going solar got its start with a voter-approved bond measure.   It’s one step in the right direction.

Can the Smart Grid solve climate change?  No, but it can reduce the amounts of emissions that we will continue to pump into the atmosphere.    Here are 6 examples of how the Smart Grid will reduce emissions:

1.  Smart Grid technologies enable integration of clean, renewable sources of energy into the electrical grid.  Sources like solar, wind, hydro, and geothermal, once deployed, have the additional benefits of using zero to low energy requirements to aid in the extraction or harvesting of these energy sources.  Contrast that to the energy costs to extract, refine, and transport coal or oil, and the emissions equation for renewables looks even better.
2. Smart Grid technologies make the electricity supply chain more energy-efficient.  Superconducting materials will reduce losses incurred in transmitting electricity great distances.  Distribution automation can further reduce energy waste by better matching supply to demand.  At the consumption link of the chain, there are many Smart Grid technologies that improve electricity use in commercial, industrial, and residential buildings.  Since the cleanest energy is the negawatt, any technologies that reduce the electricity load have a beneficial cumulative effect that can result in avoidance of new generation facilities.  Continuous commissioning is a combination of hardware, software, and services that use sophisticated sensors and actuators to maintain buildings at their best energy performance levels while maintaining occupant comfort.  Technology innovations go beyond the building envelopes and into the actual designs of appliances and consumer electronics to do more with less energy.
3. Integrating generation into the distribution grid eliminates losses from long-distance transmission and puts the users much closer to the generation sources.  CHP (combined heat and power) solutions convert what is typically waste heat from generation into useful heat, reducing the need to expend more energy.  Using backup generation sources (aka BUGS) can also reduce the need for building additional peak power plants, although many BUGS units are diesel and would benefit from replacement to cleaner energy sources like natural gas. 
4. Electrification of transportation, particularly personal vehicles, will reduce our reliance on oil, which has tremendous energy costs in its extraction, transportation, and refinement – and then there are the environmental costs.   Additionally, leveraging the energy stored within electric vehicles (EVs) can reduce the need for peaker plants during times of high demand.
5. Energy storage time shifts generation, so electricity can be stored until it is needed.  Energy storage technologies also increase the integration of small to large scale renewables into the grid.  A significant amount of global R&D activity is focused on developing the most effective energy storage technologies.
6. Energy management solutions for residential and commercial and industrial (C&I) applications build awareness of consumption, and a multitude of studies demonstrate that awareness can result in reductions of energy use from 5% to 20%.  The cumulative effects of everyone throttling back on electricity are reflected in less need for additional power generation from any source.  There are a number of solutions in the marketplace today, with the most interesting ones based on open source platforms and standards.     

The Smart Grid won’t cure our planet’s climate ills, but it will certainly lessen the severity of them if we continue to aggressively invest, innovate, and adopt the myriad technologies that reduce our need for energy derived from the dirtiest carbon-emitting sources like coal and oil. 

The US grid today operates at three nines (99.9%) reliability– far worse than other nation’s grids like Japan, which gets five nines (99.999%) reliability.  The difference is a few hours of outage in the USA versus a few minutes of outage in Japan.   Outages are quite costly to our economy.  If a grocer loses power for a sufficient time period, the losses to food inventories are substantial.  If a traffic signal is out, accidents may result.  Lawrence Berkeley National Lab released a report in 2004 that noted that estimates of ANNUAL economic losses range from $22B to $135B. 

Utilities design redundancy into their systems to reduce the risks of outages.  However, it is extremely costly for utilities to build redundant transmission facilities and generation sources, and there are the siting issues to consider.  The work-around to this challenge has been to identify “sensitive loads” where a reliable electricity supply supports operations that are mission-critical or vital to business and society.  Mission-critical operations include data centers or industrial processes and emergency services are vital operations.  While this work-around has given us three nines reliability, we can improve it by emulating the power supply configurations for telecom networks.  These networks use distributed generation and storage to ensure that mission-critical and vital communications services can operate without power from the electrical grid.  Microgrids apply this practice to the electrical grid.   

Microgrids function as miniature versions of the larger electrical grid – with three significant distinctions.  First, microgrids don’t require build-outs of transmission facilities since generation is co-located with use of electricity.  Second, microgrids integrate renewables on a much greater scale than the overall grid.  And third, microgrids use onsite energy storage to be self-sufficient or “off-grid” for periods of time.   If we identify mission-critical operations and nest them in microgrids, we can improve the reliability of the overall electricity supply and shield them from larger system disruptions.  Islanding individual or networked microgrids can avoid greater instabilities to the outside grid, or even transmit power back to the grid to stabilize it. 

Islanded microgrids need to be self-sufficient, and that means leveraging all energy efficiency (EE) plays and practicing tactics that shift and spread electricity needs to avoid peak demands that outstrip their indigenous energy supplies.   Microgrids take many of the technologies and practices found in the Smart Grid and deploy them on a small scale.  It’s a compelling strategy because scaling up the Smart Grid in a distributed manner will be faster than continuing to rely on centralized generation and transmission, and help us achieve a grid with five nines reliability.     

Next week’s blog will focus on microgrid security, which is the topic of a panel I’m moderating on August 11 in San Jose at the Smart Grid Cyber Security Conference and Expo. 

These outages are not a result of cyber attacks – although such attacks would be equally or more devastating to affected consumers and businesses.  These are a result of aging infrastructure, insufficient intelligent monitoring and control of transmission and distribution equipment, and a reliance on highly centralized generation that leaves end users vulnerable to breaks anywhere along the line.  There are many resolutions to these problems using Smart Grid technologies, but most importantly, distributing power generation facilities at many points within the electrical grid, and creating microgrids within larger grids will improve overall reliability.   Distributed energy storage is another Smart Grid technology that promises to improve reliable delivery of electricity. 

Picture this:  My mother’s retirement community is a very nice campus environment located in the heart of the Pennsylvania Dutch country.  It includes a skilled nursing facility and residential housing for assisted living and independent living situations, and that means medical needs for electricity.  The campus is surrounded by dairy farms, some operations devoted to hogs and chickens, and lots of fields of corn.  A bucolic setting, and a rural economy that could leverage the waste products of these operations for distributed generation of at least some electricity well downstream of centralized generation plants.  These farmers could harvest energy in addition to their crops, and store it in batteries – just like they now store grain in silos and corn in cribs. 

If the local electrical distribution system is upgraded with Intelligent Electronic Devices (IEDs) that can sense power fluctuations, the retirement community need never fear a power outage – their electricity would instantaneously switch from the centralized source to a nearby farm source, or even to the community’s own battery backup to ensure uninterrupted power.  The farmers could enjoy another source of income, and everyone would be happier with a more reliable energy supply.  This scenario has further advantages of building a clean and renewable domestic energy industry and creating local jobs – always a welcome prospect in rural America. 

So if you think the Smart Grid only delivers benefits for utilities, think again.  The Smart Grid means distributed generation, distributed energy storage, and distributed intelligence delivering improved reliability of electricity for everyone.  It means my mother will never have to retype and redo a chapter again, and if mama is happy, everyone is happy. 

For more information about distributing generation and energy storage across the grid, click here.

This ongoing environmental tragedy makes the reasons to accelerate deployment of Smart Grid solutions all the more compelling.  The Smart Grid uses renewable, clean energy – and lots of it.  The current grid isn’t designed to accommodate variable (wind and solar) sources of energy, but there are two Smart Grid technologies that make it possible.  First is energy storage.  Utility-scale energy storage generally fulfills one of two missions – it is either long-lasting, or it is instantaneously available.  Advances are being made in both storage categories to drive down the costs of energy storage and make it economically feasible.  (There are a few questions about how to define this asset for amortization purposes, and these are regulatory matters that need to be decided at federal and state levels). 

The second technology that supports integration of clean and renewable energy sources into our electrical grid consists of sensors and actuators that remotely monitor and control the grid at points ranging from generation through transmission to distribution.  These devices are called PMUs or Phasor Measurement Units, and they collect time-stamped data samples at multiple points across the grid to deliver what the industry calls “wide area situational awareness”.  That big picture view of the grid helps the people responsible for electricity delivery to prevent brownouts and blackouts. 

These technologies are in deployment now in pilots and in full-fledged operations.  These technologies accelerate integration of renewables into the Smart Grid, and acceleration of the Smart Grid means a faster adoption of EVs (electric vehicles) in this country.  And that means we can give the heave ho to oil, instead of watching it give the heave ho to the entire Gulf ecosystem (which includes all the humans in it). 

I alluded to the regulatory questions about energy storage, and this is important.  You can do something instead of helplessly watching video of oiled marshes and dead birds.  There is a bill in Congress to encourage investment in energy storage.  It is SB1091, the Storage Technology of Renewable and Green Energy act of 2009 (STORAGE) also known as the Wyden bill.  It provides tax credits and accelerated depreciation for energy storage assets, so utilities have financial incentives over and above the good arguments about reducing carbon footprints and reliance on clean forms of energy.    It will create a standard definition of how energy storage assets should be treated.  It is sitting on Capitol Hill right now.  You may not be able to decontaminate the Gulf waters or beaches, but you CAN do this – you can contact your US senators and representatives and ask them to make this the law of the land.  

It’s not an audacious act, but as a combined effort, it becomes part of an audacious goal – to create a Smart Grid that sustains millions of EVs using electricity coming from clean energy sources.  This should be our future, instead of continued reliance on oil.  Is that too much to hope for?