Can "Smart Grids" Really Help?

December 10, 2008

Many electric utilities around the country are rolling out a new spin on power distribution. "Smart grids" are packages of technologies and services that allow two-way communication between homes and utilities, as well as between various parts of regional power distribution systems. "Smart meters" would allow remote monitoring and control of appliances and power consumption.

Smart grids also could support real-time pricing of electricity — which in turn could help consumers and businesses make more cost-effective decisions about electricity use. And in the bigger picture, they could help power companies operate more efficiently, lose less power via transmission lines, incorporate more renewable generation capacity, and generally reduce greenhouse gas emissions and other kinds of pollution.

At least that's the spin that many utilities, business groups, and government agencies have been putting on planned smart grid projects. While some benefits are likely, on this topic there's a lot of breathless hype. The trick to covering smart grids well is separating the hype from action and results. While there are potential consumer impacts, the real impetus for smart grid projects is preventing blackouts and other reliability problems as electric demand inexorably grows.

But power is big business. Therefore, accountability-focused reporting— especially about who will pay for smart grids — can really stand out here. This May 2007 CNET article is a great example.

To get grounded in smart grid technology and strategy, a good starting point is the National Electrical Manufacturers Association. NEMA is playing a leading role in coordinating the technology, policy, and business of smart grids. Press: 703-841-3225, email.

Where are smart grid projects happening? A good clue is to watch for smart metering efforts. The U.K. firm Engage Consulting is tracking smart grid projects worldwide via an embeddable Google Map. Red icons are electricity projects. Contact: Simon Harrison.

This year, Xcel Energy named Boulder, CO, its first official "Smart Grid City" in its Smart Grid City program. Through December 2009, phase 2 of this project will entail a "full deployment phase to a broader customer base." But on Oct. 31, the Boulder Country Business Report notedthat Xcel's meter installation is behind schedule. Xcel Denver press: 303-294-2300.

The US DOE is strongly promoting smart grids as a key strategy for energy reliability and security as well as greenhouse gas reduction. DOE is also holding a series of smart grid forum events.

The National Association of Regulatory Utility Commissioners (NARUC) and the Federal Energy Regulatory Commission have a joint Smart Grid Collaborative to help regulators understand what is being developed and how it will impact consumers. This can help you track state PUC action on smart grids and T&D infrastructure. NARUC press: Rob Thormeyer, 202-898-9382.

Smart grids are touted as being better able to support plug-in hybrid electric vehicles using V2G (vehicle to grid) technology. In Boulder, Xcel is testing this by converting 60 existing hybrid electric vehicles to PHEV technology. The cars are part of the City of Boulder, Boulder County, and University of Colorado fleets (release). A recent Univ. of Michigan forum also explored this angle: 734-763-0614. And PG&E has a very active V2G program. PG&E press: 415-973-5930.

Even Google is getting in on the smart grid action. In September, Google announced it's teaming with General Electric to work together on technology and policy initiatives to promote smart grids. Google press: Niki Fenwick, 202-355-4599. GE press: Peter O'Toole, 203-373-2547. This is part of Google's greater Clean Energy 2030 vision.

The Smart Grid Newsletter is another leading resource of news and information, sponsored by DOE, the GridWise Alliance, Pacific Northwest National Laboratory, and other organizations. A recent article examined the potential impact of the economic recession on smart grid deployment. Executive editor, Jesse Berst: 206-201-1860.

Don't ignore the 800-lb gorilla lurking behind the smart grid's rosy picture: The rapidly deteriorating and increasingly inadequate, inefficient, and vulnerable state of US electric transmission and distribution systems. Utilities generally don't like to discuss this, but the deregulation of the wholesale power market in 1992 Energy Policy Act had the effect of generally curbing investment in T&D system upgrades and maintenance. Ask utilities hard questions about their T&D investments — or lack thereof — over the last 15 years.

The North American Electric Reliability Corporation (successor to the North American Electric Reliability Council) is a utility industry body that oversees eight regional reliability entities encompassing all of the interconnected power systems of the US, Canada, and in parts of Mexico. On Nov. 10 NERC issued a report, "Electric Industry Concerns on the Reliability Impacts of Climate Change Initiatives." NERC's release, "Climate Policy Critical to Grid Reliability," noted: "The existing bulk transmission network is inadequate to reliably deliver power from new renewable resources to demand centers. Innovative planning and operational mechanisms will be needed as states and provinces attempt to deliver 'clean energy' over already heavily-loaded transmission lines to meet renewable portfolio standard requirements." Report. Release.Press: Kelly Ziegler, 609-452-8060.

FERC offers detailed information on electric reliability. Explore this site for info on how reliable your local utilities are. Michael McLaughlin: 202-502-8436.