Ten Steps to a Smarter Grid
Steven E. Collier, Member, IEEE
Abstract — The U.S. electric grid is not smart. It was not planned and constructed to be able to meet the new constraints, variables and uncertainties that the future holds. The central system architecture and operating schemes haven’t really changed in a century. Long term construction and operations plans were founded upon the availability of extra capacity and redundancy to passively withstand short-term variation of demand, longer term growth and outages of lines and equipment. The traditional tools to achieve adequacy and reliability, additions to conventional generation, transmission and distribution assets, aren’t as viable now. Already, electric utility performance indicators are eroding: economy, reliability, security, asset value, profitability, sustainability, and service quality.
Things will get even more challenging. Utilities will have to operate under considerably more complexity and uncertainty as well as much closer to the margin in days to come. They will have deploy and utilize better ways for real time monitoring and control of their existing facilities as well as ways for consumers to do the same. A modern utility will have to accommodate national and regional grid interruptions, volatility in the availability and price of fuel, increased deployment of distributed generation and storage, increased consumer involvement, retail premises automation, and 24/7/365 online service and commerce.
To accomplish this, electric utilities are going to have to expand monitoring and control throughout their distribution grids all the way to the customer’s side of the meter. Fortunately, new and emerging technologies will make this possible. In fact, new electronics, telecommunications and information technologies will allow electric utilities to achieve unprecedented efficiency, economy,quality of service, safety, security, sustainability and flexibility.
This paper includes a ten-step plan for electric utilities to make their distribution grid a modern one, a smart one, an agile one. This plan is presented in the form of a Smart Grid audit that can be used continuously to assess and deploy practical options to make the grid smarter.
Index Terms — Smart Grid, Smart Meter, Intelligent Electronic Device, Outage Management, Geographic Information System, GIS, Interactive Voice Response, IVR, Supervisory Control and Data Acquisition, SCADA, Power Distribution Systems, Power Distribution Automation
If I Only Had A Brain
A. The Electric Utility Grid is Not Smart
An electric utility power system today looks much like it did more than a hundred years ago. For the most part, they are still planned, constructed, and operated with the same theories, topologies, technologies and tactics. In fact, some of the key technologies, like the electromechanical meter, are more than one hundred years old.
Electric utilities continue their traditional approach to maintaining adequacy, reliability and quality of service by planning and constructing generation, transmission and distribution with enough extra capacity and redundancy to accommodate possible changes in customer demand and recover from facilities outages. The only real options that utilities have at their disposal to significantly reduce the likelihood and duration of service degradation or interruptions is to add generation, transmission, and distribution facilities. Once constructed, there are few options open to an electric utility to control or manage the system other than matching generation to consumption. In fact, a key principle of operations is to interrupt the service provided to customers in order to protect utility assets from damage.
Unfortunately, the business environment in which electric utilities must operate has not remained similarly unchanged. The new environment demands a different approach to planning and operations.
B. A New Operating Environment
The environment in which utilities operate has changed drastically and is expected to continue to do so. And that is not just a pun on climate change. One does not have to look far or ponder much to see that a new future looms.
In January 2009 the United States Department of Energy (US DOE) released an assessment of the U.S. electric grid based upon the work of its Electricity Advisory Committee (EAC). Known as the electricity adequacy report and officially titled “Keeping the Lights on in a New World,” the report paints a dismal picture of a grid that is neither modern nor smart. Specifically, the report states: “Much of the electricity supply and delivery infra- structure is nearing the end of its useful life.”
Read this report as well as the many other sources on the smart grid and find:
(1) Increasingly frequent regional bulk power system outages and projected continued decline in reliability of the bulk power system,
(2) Increasingly unacceptable environmental impacts,
(3) Rising risk in planning, construction and operation of electric utility infrastructure:
(a) Fuel supply constraints and uncertainties,
(b) Rising magnitude and volatility of costs and prices for raw materials and finished goods,
(c) Financial instability,
(d) Global industrial development and competition,
(e) Complex new operating conditions and
(f) Post 9/11 national security concerns,
(4) Rising customer expectations with regard to the reliability, quality and economy of their electric utility service.
C. A Smart Grid is Desirable and Possible
The good news is that there is good news. At the same time as the aforementioned adequacy report was released, the US DOE released its final smart grid report, also the work of the EAC. Entitled “Smart Grid: Enabler of the New Energy Economy,” the report substantiates:
“…the benefits of moving to a more intelligent grid, not only for utilities and grid operators, but also for consumers and society as a whole. Studies have shown that the potential economic and environmental payoffs of transforming the current electric power delivery system into a Smart Grid are numerous. From an economic perspective, a Smart Grid can enable reduced overall energy consumption through consumer education and participation in energy efficiency and demand response / load management programs. Shifting electricity usage to less expensive off-peak hours can allow for better utilization of equipment and better use of capacity. From an environmental standpoint, a Smart Grid can reduce carbon emissions by maximizing demand response / load management, minimizing use of peak generation, and replacing traditional forms of generation with renewable sources of generation. A Smart Grid also holds the promise of enhanced reliability and security of the nation’s power system.”
Among other things, the report recommends:”…establishing a coordinated strategy that capitalizes on using smarter technology to evolve to a Smart Grid.”
Off to See the Wizard
Here’s the problem with the Smart Grid. Nobody knows exactly what it is. Pretty much everybody agrees that we need it for varying reasons and to various degrees. A vision of the Smart Grid is presented by the United States Department of Energy’s National Energy Technology Laboratory in “A Vision for the Modern Grid.”
“Self-heals – Today’s grid responds to prevent further damage. Focus is on protection of assets following system faults. The Modern Grid automatically detects and responds to actual and emerging transmission and distribution problems. Focus is on prevention. Minimizes consumer impact.
Motivates & includes the consumer – In today’s grid consumers are uninformed and non-participative with the power system whereas in the Modern Grid they are informed, involved and active consumers. Broad penetration of Demand Response.
Resists attack – Today’s grid is vulnerable to malicious acts of terror and natural disasters whereas the Modern Grid is resilient to attack and natural disasters with rapid restoration capabilities.
Provides power quality for 21st century needs – Today’s grid is focused on outages rather than power quality problems. Slow response in resolving PQ issues whereas in the Modern Grid quality of power meets industry standards and consumer needs. PQ issues identified and resolved prior to manifestation. Various levels of PQ at various prices.
Accommodates all generation and storage options – Today’s grid has a relatively small number of large generating plants. Numerous obstacles exist for interconnecting DER. The Modern Grid has very large numbers of diverse distributed generation and storage devices deployed to complement the large generating plants. “Plug-and-play” convenience. Significantly more focus on and access to renewables.
Enables markets – Today’s grid has limited wholesale markets still working to find the best operating models. Not well integrated with each other. Transmission congestion separates buyers and sellers. The Modern Grid has mature wholesale market operations in place; well integrated nationwide and integrated with reliability coordinators. Retail markets flourishing where appropriate. Minimal transmission congestion and constraints.
Optimizes assets and operates efficiently – Today’s grid has minimal integration of limited operational data with Asset Management processes and technologies. Siloed business processes. Time based maintenance. The Modern Grid has greatly expanded sensing and measurement of grid conditions. Grid technologies deeply integrated with asset management processes to most effectively manage assets and costs. Condition based maintenance.”
Obviously, this is a dramatic departure from the legacy electric grid. It involves grand visions and bold strategies with few specifics on how they will be implemented. It would need a wizard to conjure it up.
On the other hand, the predominant vision of the incumbent electric utility industry seems to be to get back to the straightforward, cost-plus monopoly arrangement and build more conventional transmission and generation. This is equally impractical. It would also require a wizard to make it happen.
There will be no return to the simplicity of the twentieth century regulatory compact or the central station electric utility model. The future is not like the past for all the reasons set forth in the US DOE electricity adequacy report. It is obvious that electric utilities are going to have to change how the grid is planned, constructed and operated. It’s just not clear how. Because the future is unpredictable and uncertain, the industry will have to innovate and improvise to make it happen.
Steve Hadden, Vice President of Plexus Research, and Shannon Messer, Senior Consultant at R. W. Beck, note this in a series of articles for T&D Automation, “A Useful Thing Happened on the Way to the Smart Grid: the Agile Grid,” (Parts 1, 2 and 3).” They state:
“The concept of an intelligent electric utility infrastructure or “Smart Grid” is attracting wide interest among utilities, consultants, regulators, and other utility stakeholders. This interest, however, is accompanied by widely differing expectations about when Smart Grid will emerge. Some confidently proclaim that the Smart Grid is here or “just around the corner.” But utility management and staff responsible for operating real electric systems are understandably cautious. They realize that Smart Grid will not suddenly become available in a suite of closely bundled technologies and applications. And they are pragmatic about the technology needed today to improve distribution operations for the next few years.”
Fortunately, this is doable without a wizard. Many utilities have already made a good start on a more intelligent grid. Hadden and Messer go on to say:
“The concept of intelligent infrastructure will continue to evolve, but utilities have tangible choices now, and they do not have to wait passively to provide practical solutions as Smart Grid develops. Utilities can begin using existing and emerging technologies and applications to create something we call an “Agile Grid”, on the way to creating a Smart Grid. Many utilities already have deployed, or are planning, key elements or components of an Agile Grid.”
What’s behind the Curtain
So what is the reality of the Smart Grid once one gets past the pyrotechnics? It’s making the grid smarter a little bit at a time. Just as the band America sang, “OZ never did give nothing to the tin man that he didn’t, didn’t already have,” the industry is going to have to educate itself. It will do this by continuing to deploy three fundamental building blocks: distributed intelligence, digital communications, and decision software.
D. Distributed Intelligence
The Smart Grid has a lot to do with decentralization: distributed generation and storage, distribution system automation and optimization, customer involvement and interaction, plug in hybrid electric vehicles (PHEV) and even microgrids. That means that it will be necessary to have more intelligence and control beyond generation and transmission throughout the distribution grid and all the way to the retail consumer’s side of the meter.
This will involve both fixed and mobile devices. Fixed devices will include:
• supervisory control and data acquisition (SCADA) devices and distribution automation (DA) devices,
• automatic meter reading (AMR) devices and smart meters,
• retail premises monitoring and control systems and energy management systems (EMS) and
• emerging technologies for monitoring and control, both for electric utilities and for consumers.
Mobile devices will include:
• voice and data dispatch radios,
• geographic positioning system (GPS) devices,
• automatic vehicle location (AVL) devices,
• mobile computing devices (e.g., laptop PCs, PDAs) and
• cell phones and other mobile communications and web access devices
E. Digital Communications
Remote monitoring and control devices require two-way communications. And, since the Smart Grid, by definition, is about real-time data and active grid management, fast, digital, two-way communications will be required throughout the Smart Grid. It will be required between and among the electric utility, the meter, the utility’s devices and the consumer’s devices. In all likelihood, two-way digital communications will be required with third party entities, too. For example, in Texas, there is a network of non-utility reps and resellers that are active in the competitive retail market. They are involved in metering and billing as well as matching resources and load. In the future, there may be other technologies available from third party vendors to track usage, environmental impact, and costs by individual appliances in the consumer’s home or office.
Electric utilities already use a wide variety of digital telecommunications including:
• wired and wireless telephone,
• voice and data dispatch radio,
• fiber optics,
• power line carrier,
• the Internet:
o Hybrid fiber-cable (HFC),
o digital subscriber line (DSL),
o broadband over power lines (BPL),
o wireless (Wi-Fi and WiMAX), and
Electric utilities make use of both wholly-owned and operated networks and third party networks.
F. Decision and Control Software
One of the problems that utilities have had with the precursors of the Smart Grid, the first and second generations of SCADA and AMR, was taking full advantage of the available data. In the Smart Grid, this will involve way more than a monthly or daily meter reading and notifications of outages and other service degradations and disruptions. It will involve dynamic grid management. This means that it will involve a staggering number of monitoring and control points. This is because the new world of electric utility operations will require the monitoring and control of every power line and piece of equipment on the distribution system. It will also involve an increased level of monitoring and control for every one of the utility’s retail consumers. Involving retail consumers will most likely involve multiple monitoring and control devices on the consumers’ premises. Immense amounts of data will have to be organized, analyzed and acted upon. Extremely large numbers of control points will have to be managed. That is going to require decision software. This software will come in two basic categories, decentralized, and back office.
I) Decentralized Software: The magnitude of the devices and data will preclude centralized data collection and computation. Instead, the devices will increasingly be intelligent electronic devices (IED) that can collect, organize and analyze data as well as perform computations to determine what data should be communicated where and what local control actions may be necessary. Some of this will be firmware built into the devices, and some will be programmable settings and functions. For example, a smart meter would likely have firmware to monitor and record certain variables like voltage, current, power factor and to compute KW and KWh. It might also have programmable capabilities to determine if and when to report variables outside certain ranges. It might also be used to display / collect data for the back office software.
II) Back Office Software: Most utilities already utilize some of the following back office software:
• Enterprise Resource Planning (ERP)
o Accounting & Business Systems (ABS)
o Customer Information Systems (CIS)
• Customer Billing & Payment
• Customer Relationship Management (CRM)
o Work & Workforce Management
o Performance & Productivity Management
• Engineering & Operations (E&O)
o Engineering Analysis
• Circuit Modeling & Analysis
• Reliability Analysis
• Real-Time Distribution Analysis
o Outage Management System (OMS)
o Active Distribution Grid Management
• Geographic Information Systems (GIS)
• Interactive Voice Response (IVR)
Each and every one of these back office software solutions becomes more powerful and effective by the deployment of IEDs and two-way digital communications.
Unfortunately, there is a huge problem. Deploying distributed intelligence, two-way digital telecommunications and decision software will quickly reveal that they are not interoperable. Brand A doesn’t always (if ever!) work with Brand B. In fact, Brand A doesn’t always work with Brand A. Every attempt to implement another piece of the Smart Grid puzzle is plagued by difficulty. How are utilities and their customers going to be able to monitor and control successfully in real time if all the systems don’t interoperate seamlessly?
Utilities take various approaches to this problem:
• One Stop, One Shop – Obtain a complete, turn-key solution from a single vendor. Unfortunately, there is no such solution and no such vendor just like there is no Wizard and never will be. By taking this approach a utility will have to forgo some Smart Grid functions and features. And, the utility will have to accept less than the best in some or many parts of the system that are available depending upon the competencies and capabilities of the vendor. This gets worse as the three basic categories are mixed. For example, it is very unlikely that the best SCADA vendor is going to have an equally great CIS. Or that an acceptable telecommunications network provider will have either CIS or SCADA. Even within a category, like decision software, a best of breed CIS vendor is not necessarily going to field an equally good real-time distribution state estimation solution.
• Vendor to Vendor Cooperation – A utility may approach this in a couple of different ways. One is to buy only from vendors who have already demonstrated integration with each other. Another is to require vendors (i.e., through an RFP or bid process) to agree to integrate in order to be selected. Relying on vendor cooperation can work, but it will significantly reduce the field of vendors that a utility will be able to deal with. It can also cause added expense and delays.
• Industry Standards – This is really a variation of vendor cooperation. It just becomes so pervasive that only the cooperating vendors can hope to survive. One example of this is TCP/IP protocol. If you want to communicate over the Internet, you make use of this protocol. It doesn’t matter what kind of information you are exchanging or over what telecommunications medium. Whatever brand of computer or phone or modem or software that you buy, it’s going to fit this standard. However, it is initially very difficult to achieve industry standards in an emerging market where (1) everyone is hoping to take the market by storm and therefore have no interest in being easy to integrate (i.e., easy to replace) and (2) most of the market entrants are entrepreneurs and startups with limited capital and resources to build to an industry standard before launching a product.
• System Integrators – Retain one or more experts to create the necessary interfaces between and among the various vendors. This can be helpful, but it can also be extremely expensive and time consuming. And it never ends. Every time a vendor has to be replaced, or a vendor issues a new release, or a new vendor is added, more integration is required.
• Service Oriented Architecture (SOA) – This is the ultimate system integration. It involves a universal web services based data bus architecture that allows dynamic data exchange with each vendor independently. This would obviously be preferable to trying to integrate many vendors with each other directly. Unfortunately, it still requires the Wizard because it depends upon the vendors’ cooperation in integrating with the SOA, the continued development and maintenance of the SOA to accommodate necessary features and functionality, and the involvement of a system integrator. It also requires the continued development and maintenance of the SOA over time.
• Brute Force – Just learn to live with the monkeys. Allow the Smart Grid to be mean, uncooperative and messy.
The Wicked Witch is Dead
There is an excellent emerging solution to the flying monkey problem. Some years ago, the National Rural Electric Cooperative Association’s (NRECA) Cooperative Research Network (CRN) undertook to create a voluntary data exchange standard that would eliminate some if not all of the flying monkeys. This initiative, known as MultiSpeak, has matured into a standards based, web services service oriented architecture. It has been joined by a large number of vendors in all three Smart Grid categories, and more are joining every day. While not universally adopted, nor yet exhaustive in function and feature, it is the best available combination of vendor cooperation, industry standards and SOA. If electric utilities unite in requiring vendors in all three categories to program to this industry standard SOA, then not only will the flying monkeys be gone, the Witch will be dead.
Click Your Heels
There is no point in trying to find the Wizard. He can’t help. We might as well go home. Even if home is a bit of a mess.
The Tin Man found out as he made the journey to OZ that he did have a brain, he just had to use it. Many electric utilities have made a good start. Here is a plan for an electric utility to get started and advance. Actually, it’s more of a tour guide because the destination, the future, is always changing. It’s a simple, ten-question audit. Do it now. Repeat it every few months. The goal should be to be able to show progress in every area.
1. Is there at least one senior professional in your organization who is responsible to stay informed about Smart Grid developments, technologies, deployments, and results as well as ensuring that your utility moves forward in this area?
If you don’t have somebody that is qualified in charge of this critical matter, you will not keep up.
Once you are able to mark this item complete, then replace it with this question: Is your progress in making your grid smarter as much a part of your performance measurement and management as your financial statements for your staff, your executive team, and your board of directors?
2. Can you do all of the business that your customers wish to transact with you whenever (i.e., 24/7/365) and by whatever means (e.g., in person, by mail, on the phone, via the web, on their mobile handheld device) that they wish to do?
In other words, can you do business with your customers as well as Amazon, or Federal Express or their mobile phone provider? Hint: You can’t if you don’t have CIS / CRM. You can’t if you don’t have IVR. You can’t if you don’t have web commerce.
Once you are able to mark this item complete, replace it with this question: Do your business systems automatically recognize your customer upon contact (without having to ask for their account number) and instantaneously retrieve and present their pertinent data?
3. Is it possible for you and your customer to know at any time what the services that they are getting from you are costing them, in terms that they can readily understand, as well as how much the cumulative cost right up to the minute since the last time they checked on it or got a bill?
If they have no idea the rate at which they are spending, or the total amount that they have spent so far, if they cannot find out until weeks or months later when you have read their meter and rendered a bill, and if you provide them with a bill that they do not understand, then they cannot make timely, rational, consistent decisions to manage their consumption and costs.
Once you are able to mark this item complete, ask the same question but instead of being able to simply and effectively communicate the cost of service, instead choose environmental impact (e.g., carbon footprint, the portion of their consumption that came from renewable energy sources, etc.).
4. Have you provided your consumers with convenient monitoring and control technologies to enable them to manage their energy consumption, costs and impacts?
It is highly unlikely that most consumers, even if they could understand their cost of energy or environmental impact, will be able to effectively manage their energy usage. It involves too many variables that will change too frequently, and they don’t have the tools to do so. They are going to have to have automated energy management systems. This should be top-of -mind when you make your decisions in the not too distant future about deploying third generation smart meters.
Once you are able to mark this item complete, replace it with this question: Are you providing your consumers with price or other data that allows them to manage their energy consumption in a way that achieves their goals (e.g., cost, environmental impact, sustainability, etc.)?
5. Do you have a complete, accurate circuit model of your distribution system detailed all the way to the individual retail customer and are you using it effectively for planning, analysis and operations?
How can you possibly expect to have a smart grid if you are not as smart about your grid as you can possibly be? The best possible automated outage management is not possible without this. Complete and accurate GIS is not possible without it. Real-time distribution analysis, active grid management, and feeder optimization cannot be done without it.
Once you are able to mark this item complete, replace it with this question: Are you making effective use of all of the information available from your SCADA, distribution automation devices, and smart meters along with your detailed circuit model to optimize the operations of your existing distribution system.
6. Do you have an automated outage management system in place that incorporates the detailed circuit model?
The detailed circuit model is essential to accurately locate and resolve service interruptions, identify and communicate with affected customers, and really understand in detail the reliability metrics for your distribution system. This is mature, proven technology that is already in wide use by electric utilities. If you don’t have this in place, you are not taking maximum advantage of existing technology to optimize service to your customers.
Once you are able to mark this item complete, ask the same question, only replace outages with any service degradation (e.g., voltage regulation, blinks, harmonics, etc.).
7. Do you have a Geographic Information System which fully incorporates the connectivity and analysis of the detailed circuit model?
Digital maps with complete representation of your electric utility assets and customer information as well as the underlying land base are essential for a smarter grid. Furthermore, it is paramount that you maintain with the GIS the complete connectivity and analysis of the electric distribution grid. Pretty much all GIS solutions will geographically map assets and maintain associated attributes. Almost none of them actually model the electrical connectivity or analysis of the electrical distribution grid. You will need both capabilities for a smarter grid.
Once you are able to mark this item complete, replace it with this question: Does every department and individual in your electric utility, including your customers, have access to the full functionality of the GIS system as necessary or desirable?
8. Have you deployed supervisory control and data acquisition throughout your distribution grid?
A Smart Grid means that an electric utility can determine in real time the status and characteristics of every component part of the grid and be able to actively manage every controllable device.
Once you are able to mark this item complete, replace it with this question: Do you have a well defined strategy and plans to migrate to smart metering (i.e., third generation IEDs, not your father’s AMR) for every customer?
9. Do you have a well defined strategy and plans to take maximum advantage of the Internet for your Smart Grid?
Until now, electric utilities have relied upon fielding their own communications systems for voice and data dispatch, SCADA and AMR. Now a rapidly growing number of industry standard technologies and third party providers are making it possible to reach customers with high speed, broadband Internet as well as infinitely proliferating applications that can be of use to utilities and their customers. Any electric utility Smart Grid strategy must take maximum advantage of this ultimate smart grid.
Once you are able to mark this item complete, replace it with this question: Can you access and execute all of your Smart Grid capabilities via the Internet with a remote or mobile device?
10. Do you have a well defined strategy and plans to operate “off the grid” for an extended period of time?
Do you have contingency plans for prolonged bulk power system outages? While still not highly likely, the probability of such outages is growing, not declining. To not be planning for this possibility is to not be preparing adequately to serve your customers. And what about your customers, especially large C&I installations, who may want to operate distribution systems off the grid? Will you be able to help them or just lose them? It takes a truly Smart Grid to be a microgrid and operate reliably for any period of time.
Once you are able to mark this item complete, replace it with this question: What can we do next with electronics, telecommunications and information technology to substantially improve efficiency, economy, sustainability, environmental impact, reliability and quality of service? (Assign your answer to Question 1 above to carry this forward!)
There’s No Place Like Home
A Smart Grid is going to be necessary. A Smart Grid will yield great benefits. A Smart Grid is going to be possible with existing and emerging technologies. A Smart Grid will result from a continuous process and not by magic. So, get started now on the process of making your grid smarter.
Steven E. Collier is Vice President of Business Development, Milsoft Utility Solutions
“Keeping the Lights On in a New World,” January 2009
“Smart Grid: Enabler of the New Energy Economy,” January 2009
USDOE National Energy Technology Laboratory “A Vision for the Modern Utility” http://www.netl.doe.gov/moderngrid/docs/A%20Vision%20for%20the%20Modern%20Grid_Final_v1_0.pdf
“A Useful Thing Happened on the Way to the Smart Grid: the Agile Grid,” Stephen Hadden, Vice President, Plexus Research, Inc. and Shannon Messer, Senior Consultant, R. W. Beck
America, “Tin Man”, sung by Dewey Bunnell (c) Copyright 1974 WB Music Corp. All Rights Reserved.
Editor’s Note: Mr. Collier’s literary subheads are inspired by the classic American novel The Wonderful Wizard of Oz written by L. Frank Baum and illustrated by W.W. Denslow. It was originally published by the George M. Hill Company in Chicago on May 17, 1900.