In yesterday’s post, I referenced the view of IEEE’s Alan Rotz that state governments pose a greater roadblock to smart grid adoption than the federal government.  While it may sometimes appear that progressive energy policy in Washington is occurring at a glacial pace,  a new national directive toward clean and efficient energy means that some gains are being made.  The Obama administration is investing $3.4 billion of federal money for smart grid technologies and even dedicated a speech in 2009 to celebrate the initiative.

Progress in state governments, however, has been uneven.  The major problem cited by GE’s Mr. McDonald is the current state of CVR (Conservation Voltage Regulation), which deals with the voltage level that enters the home.  Since the 1950’s, the standard has been that homes receive an average voltage around 120V with about 10V of leeway.  Problems can occur if this voltage drops below a lower threshold, so to keep these at bay utilities have simply opted to increase the average voltage throughout the system.

However, this “safety” feature comes at a premium.  Artificially high voltage levels can lower efficiency resulting in energy losses of 2-3%.  A lower baseline is preferable but increases the risk that a perturbation could drive voltages below the minimum threshold.  Voltage regulators downstream can boost losses by engaging in “voltage control”, but smart grid technologies are needed to know when and if these problems occur.

Complicating matters further, state governments have differing standards on energy efficiency.  A handful of states have required utilities to save energy by lowering their voltage levels.  The resulting lower demand costs utilities money, so states step in to financially compensate them for their losses.  That there is no uniform standard between state governments makes regulatory and technical implementation considerably more difficult.

Ultimately, the federal government has begun to do its part. The United States Energy Independence and Security Act (EISA) in 2007 put the National Institute of Standards and Technology (NIST) in charge of standardizing systems to ensure interoperability.  In other words, all the houses on the block need to be on the same page if the smart grid is going to work effectively.  Some state governments have made positive strides, but in Mr. Rotz’s estimation they have much further to go.  Their relative sovereignty aside, cooperation among states would go a long way towards a smart result.

I asked former IEEE Power & Energy Society (PES) President Alan Rotz, who recently retired from a 40 year career at PPL Electric Utilities, about his views on the future of energy and whether government should play a part.  Mr. Rotz echoed the comments heard from many other experts: it’s a big problem and there’s no silver bullet.  Only through a diversified portfolio of energy solutions can we “make the math work out” and deliver the required amount of power to the country.  Disappointing as it is to those concerned about climate change, coal must play a part in the transition to sustainable energy.  This makes research into carbon sequestration and carbon scrubbing incredibly important.  He also sees some potential in biofuels provided land and waste management issues are addressed.

Mr. Rotz foresees two other important developments.  First, he projects that the price of natural gas will continue to rise opening the market for alternatives.  He noted anecdotally that his own daughter, whose heat was generated by natural gas, was paying approximately 70% more than owners of comparable homes heated by electricity.  Second, he offered that as in France, nuclear energy would have to play a much larger role than it does now, though to do so, government reform is needed.  He related that nuclear facilities are required to pay the federal government one-tenth of a cent per kilowatt-hour generated to fund a seemingly doomed national nuclear waste depository at Nevada’s Yucca Mountain.  Politics has driven Senate majority leader Harry Reid (D-NV) to fight the placement of radioactive waste in his home (and notably a swing) state, meaning not only have funds been reallocated to other purposes, but existing nuclear facilities must pay again to store the nuclear waste they do posses.  Approximately $1 billion of fund money has been returned to utilities, but with no alternative nuclear storage plans on the table, examples like these highlight the need for a comprehensive federal energy policy.

Tomorrow, I will conclude this six-part series with Mr. Rotz’s take on the bigger problem in his eyes, state governments, and the issue of Conservation Voltage Regulation (CVR).

According to John McDonald, the Director of Technical Strategy & Policy Development at GE, there are six main smart grid solutions he would like to see employed:

1. Asset optimization

Protect what you’ve got. The electric grid is a vast, complicated system which currently does a poor job of relaying information back to the utility provider. The ability to asses the state of elements within the grid enables the system to run as smoothly as possible. One such example of asset optimization is dealing with transformers. The average lifetime of a transformer is 42 years, but when they die they go out kicking and screaming. A failing transformer will not only leak oil (requiring costly clean up) but it can explode, sending shrapnel through a substation and damaging other equipment. Having eyes and ears all along the network can head off problems like this before they start.

2. Smart meters & communication

Smart meters installed in homes, businesses and industry will be able to send and receive information from the electric provider. Consumers gain access to the cost of electricity and can program their appliances to be more economically efficient. These meters send usage information back to the grid and cede a certain level of control to the utility to keep the system free of rolling black outs and/or brown outs.

3. Demand optimization

A corollary to smart meters & communication, demand optimization is the ability for an electric utility to control how much power it releases into its distribution area. At times of peak usage, utilities may cycle certain appliances on and off to retain the fidelity of the system while causing minimal discomfort to its customers. As global climate change increases temperatures and prolongs grid-threatening heat waves, this type of cycling will become indispensable.

4. Transmission optimization

Important technical facets of transmission can lead to efficiency gains. One example is ensuring the relationship between voltage and current (i.e. the phase angle) becomes more accurate than it is today.

5. Distribution optimization

Handle supply variability (e.g. from renewable energy sources) by introducing technologies that can predict energy availability (i.e. wind speed and cloud cover forecasts) and store excess energy intelligently to be released at period of low energy production. Distribution may be optimized in other ways as well, such as introducing more sophisticated fault detection.

6. Workforce & engineering optimization

Regardless of how smart the grid becomes, utilities still need to send technicians into the field to respond to problems. Two-way communication between homes and utilities offers more sophisticated information about the nature (and existence) of problems before technicians arrive on the scene. This can lead to more timely responses with technicians carrying more appropriate equipment, less time will be spent on service calls, and fewer trucks will be on the road. Ultimately, the tangential costs of energy will decrease.

Tomorrow, I will continue my series of posts on the smart grid by relating a conversation I had with PPL Electric Utilities’ Alan Rotz on the topics of future sources of energy and key federal governance challenges to resolving our national energy crisis.

If you thought deeply about yesterday’s post you may have been left wondering, “What kind of changes need to be made in my house to establish two-way communication with my electric company? Certainly, there’s way they could know which outlet my air conditioner is plugged into.” There are a couple of resolutions to this issue.

The first is that in the future new appliances will come with smart grid technology built right into them. But if you’re like me, you probably don’t want to re-outfit your entire house at the drop of a dime. A second option, and one which is certainly more reasonable in the short term, is the less onerous installation of devices which plug into power outlets and communicate with the house itself through wireless technology. In the same way that your computer knows which internet network you’re connected to, a home control box would know which outlet each appliance is connected to. Communication of this variety can occur through a wireless standard known as ZigBee or possibly through low-cost Wi-Fi, provided it doesn’t become an energy hog itself.

This two-way communication isn’t all about granting power to the utilities, though. Your electric provider will also send information to your home about the cost of electricity at every point in time. If the price becomes too high, you can tell certain devices to modify their behavior. For example, suppose you throw a batch of wet clothes into the dryer. You can set the dryer to only introduce heat if the cost of electricity falls below a certain point. Otherwise, it can transition to tumble dry low or just fluff. For the budget conscious, this transfer of information provides a level of control non-existent through our current grid.

These benefits can be even more pronounced with heavy-duty items like electric cars. You might have occasionally heard the phrase “charge your car at night” since that’s when prices are lowest. But it’s not unreasonable to expect that owners might be willing to pay a higher premium to get the car charged sooner, provided the costs don’t climb too high. Shifting charging features on and off as a function of time can keep costs down and remove the need for owners to be constantly vigilant of the cost of electricity. GE estimates that these smart grid changes will be able to save consumers 15% to 20% on average on their electric bills even with very basic systems. These monetary savings clearly correlate with an overall increase in energy efficiency and reduced carbon emissions.

Tomorrow I will introduce the 6 main smart grid solutions as seen through the eyes GE’s John McDonald.