1.  Support a national energy policy that encourages development of clean and domestically-produced renewable sources of energy.  The Smart Grid integrates renewable sources of energy and builds the foundation for wide adoption of electric vehicles (EVs).  The faster we upgrade and update our electrical infrastructure and revise our policies to support distributed generation from renewables and EVs, the sooner we end our reliance on oil.  And that means the sooner we can keep that $1 Billion daily transfer of wealth from going offshore into the bank accounts of petro nations like Iran that don’t like us. 
2. Revise the tax code to eliminate the permanent subsidies, royalty forgiveness, and other tax breaks that fossil energy companies enjoy.  If subsidies are bad for young solar and wind power developers, then they are insanely stupid for established oil companies that earn record-breaking profits.  We can’t afford corporate welfare to multinationals that pollute our atmosphere with CO2 emissions and foul our waterways with spills and pipeline leaks.  The Smart Grid helps make that transition from dirty energy sources to clean ones that are locally produced.
3. Invest in promising new Smart Grid technologies and businesses.  To make that happen, we need long-lasting tax and investment policies that create market certainty for private investors, not the piecemeal policy erraticism that seems so uniquely applied to anything that reduces our reliance on dirty fossil fuels.   There are opportunities for the USA to take technology leadership positions in energy storage, energy efficient materials, components, and technologies, advanced analytics, and cybersecurity applications.  All of these are vital to the establishment and ongoing operations of the Smart Grid.  While we’re generating lots of heat about Solyndra, there’s been little light shed on the fact that even very smart venture capitalists generally see a 10% success rate on their investments. Thomas Edison, an inventive genius, had more failures than successes too.
4. Stop doing stupid things like making the world safe for incandescent light bulbs.  Do we pay our elected officials exorbitant salaries with perks so they can cost us more money in our annual energy bills?  The incandescent bulb, so beloved of a vocal minority in Congress, hasn’t changed much since Edison invented it.  It is an extremely inefficient source of light, and an inconvenient source of heat (which is simply wasted energy).  The Smart Grid not only seeks to increase energy supplies from renewables, it aims to decrease demand for electricity through use of more efficient lighting.  The 100W bulb that has captured the adoration of some Congressional Republicans costs $25/year for 6 hours of operation a day.  It is a total operating cost that is higher than that of compact fluorescents or other new lighting technologies. Consumers have benefited from Energy Star appliances in the form of lowered electricity bills, and we deserve to enjoy the monetary benefits that elimination of wasteful incandescent bulbs will bring to our wallets too. 
5. Allocate more funding to microgrid R&D in the Departments of Defense (DOD) and Energy (DOE).  The US military is the largest consumer of petroleum fuels in the world, and has grim statistics on the human costs incurred in fuel transport.  In 2007 alone, 170 US soldiers or civilians were killed in Iraq and Afghanistan while moving fuel.  That’s an avoidable cost when locally-produced electricity can reduce fuel needs.  In fact, the DOD’s first issued Operational Energy Strategy defines its marching orders much as many US electric utilities document them:  reduce demand, find alternative sources of energy, and improve security.  Encourage microgrid research and give it more funding.  The knowledge the military builds will be disseminated into civilian microgrid applications that are part of the Smart Grid, and could end up lifting much of the world out of energy poverty.

Such microgrids can exert profound and positive influences for 2.4 billion people living in energy poverty now.  In villages where young girls are routinely pulled from school to spend all day commuting by foot to and from remote water wells, a microgrid powering a local well can keep those girls in school.  Rural entrepreneurs can take the light from a single light bulb and extend working hours to build thriving local businesses that uplift everyone. 

That’s the vision of a new project from the Institute of Electrical and Electronics Engineers (IEEE) Community Solutions Initiative (CSI) under the guidance of the Power & Energy Society (PES) program is working to create low-cost, low-logistics, open-source solutions for electricity generation and distribution for people in energy poverty.  Their first significant project to prove out this concept is a Solar Trailer that provides 1.4 kWh of electricity – the daily power needed by 40 homes for single-purpose uses.  Each Solar Trailer charges a number of 12V batteries that can be used around a village or town.  By functioning as community charging stations, the roaming batteries run small devices like LED lightbulbs, chargers for mobile phones or power tools, or small refrigeration units.  The first trailers have been deployed in Haiti, but the project is more than a technology effort – it is an activity that requires local community involvement from planning through deployment stages.  The end goal is to create local jobs and work with the Haitian government’s goals of delivering electricity to 75% of its unserved citizens.

In addition to the Solar Trailers, other community charging stations may generate electricity through pedal-power or wind turbines, or perhaps other innovative local generation technologies.  All generation technologies used in the CSI initiative will be open-source and based a Sustainable Energy Reference Architecture (SERA), because it is essential that local resources can develop and maintain their community operations.  The CSI website also shows a number of creatively cheap products such as battery-powered light sticks that can be made with bamboo and a few LEDs – very cool ideas that could translate into local businesses that create local jobs and address energy poverty.

The IEEE PES CSI team participates in the UNF MicroGrids Work Group that was described in my September 19 blog.  Their work will certainly contribute to the best practices for technologies, community involvement, and financing that will help turn microgrid concepts into reality for the developing world. 

In countries like the USA, microgrids can increase reliability at the distribution level, expedite integration of local renewable generation sources, and create new business models for campuses and neighborhoods.  For the developing world grappling with energy poverty, microgrids can cost-effectively expedite delivery of basic electricity services and have profound impacts on quality of life for 1.4 billion people.  These are Smart Grid benefits that are definitely worth pursuing everywhere. 

To learn more about how your company can get involved in the UNF MicroGrids Work Group or the IEEE PES Community Solutions Initiative, please contact me, or attend this webinar on  September 28 titled: Microgrids: Game-changing solutions for developed and developing electricity grids.   

Consider life for those 2.4 billion people living in energy poverty.  It limits the amount of time they spend in work or education to daylight hours.  It limits connections to the outside world to communications equipment operating on battery power.  They can’t rely on refrigeration systems to keep food safe or water purification systems to ensure potable drinking water.  They suffer from health problems which cannot be addressed with any medical devices that require electricity or refrigeration.

Reliable electricity has profoundly positive implications to developing economies.   But existing ways of planning, building, and delivering electricity – defined by centralized generation, transmission, and distribution systems, are cost-prohibitive and time-consuming to deploy.  What is needed is an innovative Smart Grid solution to eliminate energy poverty for one third of the world’s inhabitants.

I recently spoke with Terry Mohn, Founder of General MicroGrids, Inc., a company that specializes in sustainable energy solutions.  For him, the answer is yes, microgrids will become the prevalent energy delivery solution to eliminate energy poverty.  He is putting his expertise to work as Co-Chair of the United Nations Foundation’s MicroGrid Work Group with the mission to leverage industry experience to achieve this objective.        

 The UNF Project Underway                               

The United Nations (UN) recently organized an effort through the UN Secretary-General’s Advisory Group on Energy and Climate Change to commit UN member countries to address energy poverty.   The effort is led by UN-Energy, a collaboration of 20 UN agencies, as the UN Campaign on Sustainable Energy For All.  It has three main objectives to meet by 2030:  1) Achieve universal access to modern energy services; 2) Improve global energy intensity by 40 percent; and 3) Produce at least 30 percent of the world’s energy from renewable sources.   

The UN Foundation (UNF) plays a key supporting role to drive concrete actions on energy access at the national level. The UNF has oversight of global awareness and education campaigns and fosters private-sector engagements.  The Work Group that Terry co-chairs is building a practitioner network focused on addressing the barriers to achieving the project goals.  According to Terry, “we need to bring together global stakeholders to develop a more integrated approach to energy access planning and execution than has previously been done. We intend to catalyze the scale-up of renewable and low-carbon technologies and spur the market toward universal energy access. It will focus in particular on the removal of barriers to the effective delivery of energy services by promoting the development of new technologies and innovative financial and business models. It will also identify and disseminate best practices and foster strategic partnerships to promote energy access.”

The Work Group is reaching out to companies that have experiences in planning, building, and financing microgrids.  The answer is yes, microgrids can help eliminate energy poverty.  But there’s more to this story, and the discussion about microgrid market opportunities, barriers, and ongoing projects continues in next week’s blog and will also be explored in an upcoming Energy Collective webinar. 

Here’s a coda to my previous articles on data analytics – I’ll be moderating a panel session on September 21 for Agrion in the San Francisco Bay Area.  Focused on Distribution Automation (DA) and advanced communications, we’ll discuss the role of analytics in DA and converged networks.   

Harking back to that saying again, “don’t put all your eggs in one basket”, microgrids offer a solution to some physical and cyber security concerns.  Placing generation sources throughout the grid and having the ability to “island” or isolate important electricity users in microgrids can at least reduce the impacts of a cyber strike.  Instead of completely disrupting all grid-supplied operations, these mission-critical functions could continue under their own power.  The US military is already planning microgrids for fixed and mobile bases, and has projects underway at Wheeler Air Base in Hawaii and Twentynine Palms Base in California.  These microgrids should have designs for complete power self-sufficiency that can last for months to address the worst-case scenario – the cyber equivalent of a Pearl Harbor attack. 

However, some security specialists point out that microgrids increase the “attack surface” by offering more points of access to the larger grid where the microgrid has communications connections, or even the electricity lines themselves.  And it’s true, communications systems, and these are mostly IP-based, do have vulnerabilities that can be exploited by hackers.  Therefore, microgrid designers and operators need to take precautions to ensure that the industrial control systems (also known as SCADA systems – Supervisory Control and Data Acquisition) and other points of cyber access must be as secure as larger grid operations. 

The traditional electrical grid used to rely on obscurity as a form of cyber security protection.  Closed systems and proprietary solutions made it difficult for hackers to gain access.  However, the Smart Grid is triggering an open and IP-based communications transformation in the grid’s transmission and distribution networks.  Therefore, the same security measures and practices that are being deployed in utility-scale grids must be adapted for use in microgrids.  However, where utilities have full time operations personnel devoted to security monitoring, microgrids may not have sufficient resources to duplicate this arrangement.  Microgrids need automated monitoring to detect intrusions and trigger immediate responses, and use best practices and frequent audits to identify and correct weaknesses in their physical and cyber security perimeters.      

Microgrids improve overall grid reliability and security.  They make it easier to quickly integrate renewable sources of generation into the grid.  The benefits that microgrids contribute to our overall electrical grid outweigh the security risks to it, but it does mean caution must be exercised in building out a microgrid infrastructure that is interconnected to the Smart Grid.

You can learn more about microgrid security at the Smart Grid Cyber Security Summit in San Jose on Tuesday and Wednesday.  I’ll be there moderating a session on microgrid security – see you there!

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.

Was this evidence of a smart meter backlash or a simple demonstration of that adage that familiarity breeds contempt?    Only detailed surveys will determine that, but it is clear that PG&E needs different advisors in the executive suite and a fresh approach to interacting with customers. 

So, community choice is safe in California, and this is excellent Smart Grid news for two reasons – but there’s a real warning in the poll results too.  (Community choice lets cities, counties, or neighborhood entities purchase and/or generate electricity for residential and business use within their boundaries.  Community choice means local control over energy resources, more renewable sources of energy, plus a lower overall cost of electricity.) 

First the good news.  Community choice should accelerate the integration of sources of renewable energy into the grid.  As the environmental devastation grows from oil spills (even on land – see the Red Butte Creek spill in Utah), it is becoming apparent to even the most oblivious that this is one fossil fuel that we would be well-served to render obsolete.  For instance, communities can band together to create solar gardens and aggressively convert rooftops to solar power to generate local clean and renewable power for their electric vehicles.  

A second benefit is that distributed generation improves our grid security.  Complete reliance on centralized energy generation puts all eggs in one basket.  If you believe the reports about hackers infiltrating the computer networks that control the electrical grid, or even if you only believe a fraction of them, there’s serious reason to be alarmed and deploy solutions that improve the stability and reliability of the electrical grid.  A grid studded with microgrids and CCA-controlled energy sources is a smarter grid, less likely to be completely disabled and able to recover faster from natural disasters or acts of criminality and terrorism.     

However, there is a real worry in the Proposition 16 results.  It is clear that PG&E customers don’t trust PG&E.  This does not bode well for future PG&E efforts to educate their customers about TOU (Time of Use) rates and other measures to reduce electricity needs at peak time periods to save money and reduce carbon emissions.  Enlightening consumers about their energy use and encouraging participation in smart energy programs is a process of complex messaging, and it requires a relationship of trust.  PG&E doesn’t have that now, and the big question is – can they earn consumer trust to be effective in their future Smart Grid solution rollouts?  If they fail in that endeavor, we all lose. 

Microgrids within a utility’s grid can collectively deliver utility-scale distributed generation by selling excess energy to utilities.  However, microgrids can also supply what I call “virtual” generation by disconnecting from the utility grid and functioning as energy islands during peak usage times.  This is an extreme form of a Demand Response Program, but it can be done at a scale that eliminates the need for future utility investment in generation assets.  It is quite a shift for utilities to no longer build to peak electricity needs – but the Smart Grid and microgrids in particular – can help utilities evolve planning functions to asset optimization.  And since many microgrids incorporate renewable generation and storage, they are a great way for utilities to add distributed renewable generation and storage management into their asset investment plans.     

I was at the National Electricity Forum last week and asked the panelists discussing a new electricity infrastructure about the assumptions they were making to include distributed generation and microgrids into their plans.  The bad news is that they really aren’t making plans for distributed generation.  They are making plans that assume that all new generation is remote from users, and requires investment in transmission facilities, including new lines and new routes.  That may happen, but it won’t happen quickly, and only at great political and capital costs.  There’s a fast track for the Smart Grid, and it is based on wide scale distributed generation and microgrids.  Distributed generation and microgrids can happen much faster than many other benefits of Smart Grid solutions, and lead the way for an energy ecosystem in which there are many more winners and fewer losers.

To learn more about microgrids, join me at the Sustainable Silicon Valley/Santa Clara University Smart Microgrid event on February 23.  You’ll hear about this university’s project to upgrade their existing microgrid to a smart microgrid and enjoy thought-provoking discussion from a great panel of industry leaders – I’m looking forward to being the moderator.

Mark your calendars for the Metering, Billing/MDM America conference in San Diego on March 7-10.  This is a great show to learn about metering of electricity, gas and water, and the latest technologies to make dumb meters into smart meters.

There seems to be this shared fantasy amongst car companies and industry watchers that since the cost of electric charging will be less than the cost of gas tank refills, these SUVS are “economical” options for consumers.   Well guess what.  Unless you can fully rely on electricity generation through your personal microgrid, sooner or later you will be buying electricity from a utility or an electric charging station, and it is going to cost you money and time. 

Even with Time-of-Use (TOU) pricing and software to program a car to only charge when electricity is cheapest, charging fees will still add up.  At the recent National Association of Regulatory Utility Commissioners (NARUC ) summer session, discussions about electricity prices had a recurring theme – in the future, electricity will cost more in every region of the USA. 

There is also a set of unspoken assumptions made about the drivers of electric vehicles that don’t model real life.  Apparently, EV drivers have no social life because once they are home every evening after work, they won’t drive again until it’s time for that morning work commute.  EV drivers are also assumed to be exceptionally well-organized and always charge their vehicles when the rates are cheapest – model citizens of rational behavior.    

And finally, cars are still seen as consuming electricity, but not as storage devices that could actually sell electricity too.  An electricity-sipping vehicle might possibly make more money for its owner than an electricity-guzzling vehicle, but Smart Grid infrastructure and regulatory policies must be deployed to support full bi-directional electricity flow

We desperately need a new way of thinking about electric vehicles.  A good start would be with new standard metrics.  Using miles per gallon won’t tell the full story of an EV car’s energy costs and potential profits.  What are the miles per kilowatthour (KWh)?  This metric is like mpg – and consumers can determine their costs based on energy prices in their region.  What is the potential amount of KWh that a consumer can negotiate to sell back to a building or utility and still make it to their destination and/or cheapest charging option?  

We also need new market models.  Wouldn’t it be fantastic if you drove a car off a lot, and instead of it instantly losing a couple thousand dollars in value, it was going to earn you money as an energy storage device?  Software that projects these potential earnings could help justify the purchase of an EV, but it needs to be independent of the car manufacturer to be considered credible.   

The bottom line is that real energy economy comes from smaller EV vehicles, not electric SUV behemoths similar to the ones that currently roam our highways and suburban roads.  Exchanging one form of energy guzzling for another isn’t smart and any car manufacturer that bets its product line on electricity guzzlers will be looking for another taxpayer bailout in a few years.  We can’t afford to continue using today’s market models for EVs either.  If consumers have options to make money from the EVs as electric storage devices that can sell electricity during peak demands, they’ll embrace the technology.

I’ll be at the Green Software Unconference on Wednesday, August 19th in Mountain View, CA to facilitate discussions about the Smart Grid.  Join me there to continue this conversation.  http://greensoftwareunconference.eventbrite.com/

I asked this question because this n application will be ubiquitous in homes in the next few years.  The answers I received included an R&D shop’s solution (which might be proprietary), feedback about sensitivity of usage data, and a reference to the UtilityAMI Home Area Network System Requirements Specification.  

Let’s talk about the sensitivity of usage data – how much energy you use.  This is often cited as a security concern – if people can capture the data about the electricity you are consuming, they can tell if you are home or not.  I guess that’s true, but they would have to know an awful lot about my typical electricity use.  What if I’m a careless energy consumer that leaves computers, TVs, cell phone chargers, and lights on all the time – whether I’m home or not?  In this example, will there really be a significant difference in my KWh if I leave town for a week?  Maybe from a stratospheric bill to merely sky-high. 

In a world with more microgrids, the bad guys looking at my usage data would not know that a sudden decrease in my energy bills might be due to my brand new mini-wind turbine and solar panel installation. 

I do think people would be very touchy about the confidentiality of this information – I might not want my neighbors to know that I’m an electricity guzzler.  However, I don’t think extrapolating my usage data is a worthwhile criminal enterprise for people looking to make an illegal buck.     

More malicious activities would involve comprising the integrity of my usage data.  Although I can’t see what monetary gain a hacker would reap from modifying this data, they could certainly stress me out if my next utility bill was in the stratosphere.  Ditto if they messed with my microgrid data, depriving me of that cash that I was expecting from the utility based on their purchase of my microgrid’s generating capacity. 

So usage data may not be the most important data to secure in a HEMS application.  However, financial data and personal identification data like Social Security Numbers might be connected somewhere in a HEMS application to a utility, and therefore may be vulnerable to unauthorized access or compromised integrity.  That could be a problem.  We read stories all too often of the global criminal networks engaged in buying and selling credit cards and identification information.  This is a potentially huge liability for utilities, but they are working to address it through groups like the UtilityAMI OpenHAN Task Force.   

The UtilityAMI OpenHAN (Home Area Network) Task Force has defined 4 sections under the security category for guidelines that promote open, standards-based interoperable HANs.  Any HEMS application would be part of the HAN, and governed by the security guidelines under development by this group and other knowledgeable organizations.  The OpenHAN Task Force defines the following four subcategories: Access – the control and confidentiality of data and information; integrity – the ability to ensure protection of data (in storage and in transit) from unauthorized users; accountability – the date/time/user event info to audit a system; and, registration – the authentication of identities that are established within a HAN and known to a utility.   This is a great construct for utilities and vendors to ensure that all software is designed and deployed to ensure security as well as interoperability.

This Task Force takes a utility-centric view, which is perfectly reasonable considering that utilities have a great deal at stake in getting the right specifications defined for future Smart Grid operations.   The work that this Task Force has been doing is also shared with the ongoing work that NIST is taking in conjunction with EPRI to develop interoperability and security standards. 

I’ll lead a discussion about software characteristics – especially at the user interface in HEMS applications – for the Smart Grid at the Green Software Unconference on August 19^th in Mountain View, CA.   .   Join me there – click here to learn more about the agenda and how to register.