The Wakeup Call Has Sounded
The energy grid wakeup call rang loudly after decades of growing energy use and a false confidence that the grid would somehow always find a way to serve its users. The 2003 blackout in the northeast United States and Canada that affected more than 50 million people gave both users and providers a message that status quo wasn’t good enough.

Since then there has been a growing push for improving the North American power grid toward what we now call a Smart Grid; one that introduces pervasive communications and embedded intelligence while providing for much broader consumer engagement, and more diverse operating requirements.

In fact, legislation in both the U.S. and Canada has pushed infrastructure investments in technologies intended to put the ‘smart’ in Smart Grid and thereby address critical energy issues. The Energy Policy Act (EPAct) of 2005 mandated that each state evaluate the business case for advanced metering infrastructure. In Ontario, the Energy Conservation Responsibility Act of 2006 mandated deployment of smart meters to all consumers by 2010. The U.S. Energy Independence and Security Act of 2007 (see Figure 1) expands support from the U.S. government for investments in Smart Grid technologies while further emphasizing the need for the power industry to play a leadership role in addressing carbon dioxide emissions affecting climate change.

Recent state-level legislation and growing consumer sentiment suggest an increasing appetite for making investments in distributed clean technology energy solutions. Distributed generation technologies such as solar, wind, and biodiesel are becoming more readily available and have the potential to significantly improve grid operations and reliability while reducing carbon emissions.

1. Increase use of digital information and controls technology to improve reliability, security, and efficiency of the electric grid.
2. Dynamically optimize grid operations and resources with full cyber-security.
3. Deploy and integrate distributed resources and generation, including renewable resources.
4. Develop and incorporate demand response, demand-side resources, and energy-efficiency resources.
5. Deploy ‘‘smart’’ technologies – real-time, automated, interactive technologies that optimize the physical operation of appliances and consumer devices – for metering, communications concerning grid operations and status, and distribution automation.
6. Integrate ‘‘smart’’ appliances and consumer devices.
7. Deploy and integrate advanced electricity storage and peak-shaving technologies, including plug-in electric and hybrid electric vehicles, and thermal-storage air conditioning.
8. Provide timely information and control options to consumers.
9. Develop standards for communication and interoperability of appliances and equipment connected to the electric grid, including the infrastructure serving the grid.
10. Identify and lower unreasonable or unnecessary barriers to adoption of Smart Grid technologies, practices, and services.

What is the Nervous System for the Smart Grid?
While the electric power distribution grid today provides a critical role in the delivery of energy services, it does so with limited visibility into system performance and customer behavior. A Smart Grid requires a sophisticated nervous system that will provide increased reliability, interoperability, two-way communications, risk-managed services, and will support changes to the grid as new power resources are added while empowering consumers to be able to better address their energy and financial needs. To be intelligent, the grid’s nervous system must answer the need for pervasive communications.

Today the Smart Grid industry is largely nascent and proprietary while the future demands solutions that are fast, interoperable, reliable, and able to mitigate risk while accelerating benefits, operating efficiency, and customer satisfaction. The Smart Grid’s intelligence lies in the interconnection of communications technology including voice, mobile, and fixed data and intelligent standards, for plug-and-play networks on a global scale.

As the Smart Grid evolves, every device added to the communications network has the potential to add intelligence to the system overall, providing for new network-based applications in addition to traditional point solutions. A core business driver for the adoption of an intelligent communications platform is to support smart metering applications, also referred to as advanced metering infrastructure (AMI). AMI involves automated measurement of time-of-use energy consumption – hourly, 15-minute or 5-minute intervals – and provides for new time-of-use rates that encourage consumers to use energy during off peak hours when generation costs are low, rather than peak periods when generation costs are high and the grid is under stress.

With time-of-use rates, consumers may continue to use power during high peak periods but will pay a higher price to do so. AMI may also include remote service disconnect functionality that can reduce costs associated with site visits otherwise required to manage move-out/move-ins or to support pre-payment programs.

Other Smart Grid capabilities that may be realized through the deployment of intelligent communications include improved outage management detection and restoration monitoring, revenue assurance, and virtual metering of distribution assets achieved through associating and aggregating metering data.

As Ahmad Faruqui of The Brattle Group – a firm that provides consulting and expert testimony in economics, finance, and regulation to corporations, law firms, and governments around the world – has underscored, “The need for two-way communication between the utility and its customers lies at the heart of all Smart Grid initiatives. Such communication allows dynamic pricing to be transmitted to customers and it also enables customers to automatically curtail usage during critical hours and to shift energy consumption from high-priced peak periods to low-priced off-peak periods. In this fashion, both parties work synergistically to manage the cost, delivery and environmental impact of power generation and energy services delivery.”

Intelligent Communications Network Basics
Modern communications network solutions leverage standards-based technology, such as IEEE 802.15.4, thus providing robust two-way wireless mesh network communications to a broad range of sensor and control devices. An intelligent communications platform provides for much greater ability to market new offerings to targeted customers based on their energy consumption profiles while also empowering consumers with new tools and access to information providing for a greater control over energy costs and improved satisfaction.

The intelligent communications platform should provide for remote firmware upgrades to connected devices and be capable of leveraging Internet protocol (IP) based communications across multiple wide area network (WAN) platforms (Figure 2).

Also critical for leveraging a communications infrastructure investment is support for broad interoperability and interconnectivity, as embraced by the following guidelines.
 

• Interoperability for AMI applications means supporting a broad range of options for metering devices.
• A communications platform should be meter-manufacturer independent, empowering choice for utilities. This provides for current and future competitiveness for the meter itself, which is one of the more expensive elements of the smart metering solution.
• Interconnectivity for communications platforms refers to the ability to support a broad range of functions, both end point devices as well as systems at the head end.
• To support demand side management and energy efficiency initiatives, an intelligent communications should support programmable communicating thermostats (PCT), in-home displays (IHD) and load control switches. Ultimately, an intelligent communications platform should support a model whereby third-party manufacturers can develop solutions that operate on the network providing competitive options for utilities.
• For enterprise system interconnectivity an AMI, demand side management or other Smart Grid head-end application should be developed using service oriented architecture (SOA) principles and Web technologies.
• These applications should also support modern Web services-based solutions, providing published simple object access protocol (SOAP)-based APIs. Utilizing this approach provides for easier integration to existing enterprise systems as well as simplifying the process of adding functionality, either through enhancements provided by the vendor or add-ons delivered by third parties or developed by the utility.

Finally, the value of an intelligent communications platform deployment is driven by the ability of other enterprise applications and processes to utilize the vast amount of new data received through the AMI, demand side management and Smart Grid applications.

Core areas of extended value include integration with:
 

• Customer information systems
• Call center processes
• Outage management systems
• Work management systems.

How Utilities and Customers Employ the Smart Grid
While the Smart Grid encompasses a combination of hardware and software built atop an intelligent communications infrastructure, it also requires tools for consumers and utility companies alike to help manage, monitor, and respond to energy requirements. The flow of electricity from utility to consumer becomes a two-way conversation, saving consumers’ money, delivering more transparency about end-user usage to the utilities, and reducing carbon emissions. In some cases, consumers could even be compensated for their efforts to minimize their carbon footprint, even to the point where consumers can sell the energy generated through renewable sources at home back to utility companies.

E.ON U.S. subsidiary Louisville Gas & Electric (LG&E) serves nearly 400,000 electric customers in the greater Louisville area. LG&E is currently working with Trilliant on a responsive pricing program that incorporates time-of-use pricing with a real-time, critical peak pricing component, as well as Demand Side Management (DSM) tools for those customers who choose to participate in responsive pricing.

The implementation of this variable rate structure is possible through the use of an intelligent communications platform that integrates smart meters (electric and gas), energy use information displays and DSM equipment such as programmable thermostats and load control switches for customers in some homes and small businesses. Automation of major energy appliances empowers participants to shift usage in response to rate changes without manual intervention.

The power usage management program is designed to learn about whether keeping customers informed about electric rates and their own consumption will spur them to use power more judiciously. The communications platform supporting the program utilizes a wireless mesh network based on the IEEE 802.15.4 standard.

Devices that interact on the network include programmable thermostats, load control switches, in-home energy use displays, as well as electric and gas interval meters. The mesh network utilizes multiple wide area network (WAN) backhaul options including Wi-Fi, digital cellular and fiber, providing for selection according to least cost and best performance.

According to Greg Fergason, Demand-side Management Program Manager at E.ON U.S., the question that LG&E wants to answer is whether giving customers more information and greater control over energy usage will encourage them to use less power or shift usage to periods of lower demand. The goal is to make it easy for the consumer to do the right thing with respect to their energy usage. They will get their answers through the improved information management provided by this framework.

At Hydro One, one of the ten largest transmission and distribution utility companies in North America, and the largest electricity delivery company in Ontario, Canada’s most populous province, they are well on their way to installing smart meters in all homes and small businesses by 2010. The Smart Meter Project is part of a larger undertaking in Ontario that will mean building almost a whole new electricity system by 2025, including replacing 85% of its current generating systems as they retire over time, and expanding the system to meet future growth.

To do this, Hydro One has built an award-winning smart meter solution based on a 2.4 GHz RF mesh intelligent communications network foundation. This Smart Grid plan is designed to maximize flexibility and interoperability in a customer base that is a mix of urban, rural and remote customers. Some of the latter are accessible only by air, rail, boat, or snowmobile.

According to Myles D’Arcey, Senior Vice President, Customer Operations at Hydro One, the utility sees the Smart Grid as representing the future of energy management for the company and for its customers. The company is close to its target of installing a total of 610,000 meters by the end of 2008 and 1.3 million meters by 2010.

Ontario’s Smart Grid includes a two-way self-healing mesh intelligent communications infrastructure that is based on non-proprietary, high bandwidth enabling industry standards (2.4 GHz IEEE 802.15.4) that enable use of data from many types of devices from a broad range of manufacturers for meters, load control, in-home displays, distribution monitoring and control, and head-end software applications. The information is available on customer information, outage management, asset management, geographic information and work execution systems.

One unique feature of the province’s smart meter deployments is its centralized Meter Data Management Repository (MDMR), including a paperless change meter order process that handles the needs of all local distribution companies across the province and its geographically dispersed work force. The system is designed to transition customers from conventional rates to time-of-use pricing in the near future.

Integration of Distributed Generation Resources into the Smart Grid
While reliability and lower-cost electricity remain the key functions in the Smart Grid, deployment and integration of distributed generation, including renewable resources, are important supply side elements of the Smart Grid vision and should not be overlooked. These may include installation of arrays of solar photovoltaic panels on home and office roofs, solar carports, small wind (3-5kVA) turbines, small biogas turbines, and fuel cells.

By integrating these resources into a common communications platform, utilities have the opportunity to develop solutions that achieve a much greater result than simply the sum of independent systems. For example, intelligent plug-in hybrid electric vehicles (PHEV) connected to a smart solar carport may choose when to purchase power for charging the car or even to sell power back to the grid in a vehicle-to-grid (V2G) model based on dynamic price signals received through the communications platform. And, by maintaining intelligence at the edge of the grid, consumers and distributed resource owners can be empowered to manage to their own energy usage and benefit the grid as a whole.

Global climate challenges and system reliability are providing the drive, but technology, legislation and consumer interest will provide the extra stimulus to drive Smart Grid infrastructure investments in the coming decades.

With the realities of global warming and the concern of system reliability, there is a growing sense of urgency to take action. A future without a Smart Grid equals increasing power outages, severe strains on the grid, and uninformed and ‘un-empowered’ users. An intelligent communications platform underpinning the Smart Grid provides an important foundation capable of supporting multiple devices in multiple environments – commercial, industrial and residential – working seamlessly together in a single unified network.

All the technical assets of a Smart Grid can be managed holistically rather than as isolated or poorly connected parts. The power of a network grows geometrically according to the amount of resources and assets actively connected to it. It is the future of the Smart Grid, and it is available today – making this the time to embark on realizing the vision of a Smart Grid.

About the Author
Paul Karr has more than 20 years of experience across marketing, sales, and business development. Before joining Trilliant he held executive positions in marketing and product management at Sun Microsystems where he played an instrumental role in the successful integration of SeeBeyond Corporation. Prior to Sun, Karr was Director of Strategic Alliances at CellNet Data Systems where he helped guide strategy through the acquisition by Schlumberger. Karr has a Master of International Business degree from Seattle University and a BSEE from the University of Washington.