The big challenge with today’s Smart Grids strategy is that it is all based on managing peak load and are designed around a “gosplan” utility megawatt mindset architecture of huge centralized databases for the acquisition, management and control of consumers meters and appliances. (Another aspect of Smart grids is for utilities to better manage their own infrastructure which makes sense, but that is separate issue than managing consumer devices) .The main beneficiary is not the consumer but the utility operator in avoiding having to build new power plants for peak load. The environmental benefits are minimal and the savings to the consumer are marginal (around 10%) based on data from the Smart Grid trial at PNNL in Washington State. There are also huge challenges with respect to security as outlined by Rahul Tongia at CMU in his e-mail on Dave Farber’s IPer list. Imagine if someone hacked such a network and were able to turn off and on your appliances and electricity at will.
Innovation rarely comes from large monopolies like electrical utilities and telcos. But the Internet research and education community has a long of history of innovation particularly in adopting principles of the Internet in terms of intelligence at the edge and broadband network infrastructure as exemplified in the excellent paper “Unleashing Waves of Innovation” http://www.ntia.doc.gov/broadbandgrants/comments/488.pdf. R&E networks around the world have been instrumental in network innovation and working with communities in broadband infrastructure such as initiatives led by Educause, Internet 2, NLR, KAREN, i2Cat, etc. I believe the same organizations have the capability, infrastructure and knowledge to pioneer new techniques for smart grids built around the principle of intelligence at the edge and customer control. Universities, schools and research institutions in partnership with R&E networks are well suited to work with communities on exploring new architectures and solution for Smart grids that will have genuine benefits for the consumer (as opposed to the utility) as well as the environment.
Germany happens to be a world leader in this area and has many great examples of new smart grid architectures where consumers can also supply power to the grid. The 5th estate video compares and contrasts the German approach to what is largely happening in North America. In Germany consumers can arrange for their own meter independent of the utility and subscribe to different energy providers. Thanks to John Spence and Frank Coluccio for these pointers – BSA]
Great 5th estate video on green in Germany versus Canada in Smart grids and renewable energy http://www.cbc.ca/fifth/2008-2009/the_gospel_of_green/video.html
Opportunity is promising, but utility cooperation will be the challenge
By Sean Buckley | Telecommunications Magazine | March 31, 2009
"As I head out to CTIA to help host our one-day Machine to Machine: Show me the Money panel series, it’s hard not to notice reports that Verizon is considering the idea of adding energy management services as one of the services it could offer over a home network connected to its FiOS FTTH service. Other than saying they will offer videoconferencing, Verizon has not formally confirmed a plan for an energy management service. I don’t think the idea of a telco like Verizon, or any service provider for that matter, offering energy management is far-fetched. Service providers, especially those like Verizon and their RBOC counterparts (AT&T and Qwest) are looking to find new ways to differentiate themselves and avoid having others leverage their connections into the home for applications they don’t control."
Rahul Tongia email@example.com from a posting on Dave Farber’s IPer list
As a researcher in the "smart grid" space, I will mention several facts/observations about smart grids:
1) People are throwing solutions out before figuring out what the problems are. Adding billions of $ to the mix (with strange rules to boot - e.g., sizes and $ limits per project) doesn't help. 2) The fundamental thing utilities need to understand when designing systems is what their functional goals are: audit (important in a place like India, with 10-20% theft), monitoring, or control. You need different
designs. These then lead you to the issue of communications design.
It's NOT bandwidth that is the concern, but predictability and reliability. Should the utility own it themselves, or rely on outsiders? I could user outsiders with the former, but is it appropriate for things like control? I don't think so (IMHO). 3) Some of the largest vendors of meters and affiliated technology are behind the curve in technology. Some of the best firms in this space are relatively small.
4) Security cannot be an add-on. Everyone pays lip service to security, just like being "green." But have we developed the right, lightweight solutions?
5) Open standards are going to be critical, else we will end up with $ $, proprietary, and sometimes inferior solutions. 6) Getting communications right in both directions is the key challenge. We need to innovate more! Both directions means from the user/meter to and from the utility. Then, from a user's central point (maybe meter, maybe inside), signaling to appliances and devices.
One has to realize how little the costs could be for smart systems.
Take a smart fridge. No, I don't want it to order milk when my an RFID chip on the milk carton says expired. I just want energy efficiency and load control. If a fridge knows when peak electricity is, then there is no reason it should run the compressor, or five times worse, the defrost cycle, during peak periods. Extra cost at the fridge level for the intelligence AND short-range communications? A few dollars (if built to standards in high volume). The issue is chicken- and-egg. Who signals, where, and how is an unanswered Q. The utility?
Governement? A neutral grid operator? Consumer aggregators (energy service providers)? Or the consumer himself/herself?
I think automated systems that don't rely on humans are going to work better than people staring at a household display (thermostat/meter) to take actions. As a consumer, I should be in charge of that, unless
I am willing to give the utility or a 3rd party such control.
Certainly price signals are important. Here Time of Use is not as good as Real-time (near real time) since (1) ToU can become a self- negating prophecy and (2) only the latter can deal with unforeseen events.
A relatively sophisticated (but low bandwidth) solution is important.
We need bidirectional communications once we go beyond automated metering as a goal. For starters, you need that if you consider communications security. You need to have touchless upgrades and security enhancements - a meter will last 15-20 years. Can anyone
swap out a network key with a one-way radio broadcast and verify it?
Bidirectional is also important when we consider compliance (if not "theft"). I'm not talking the India or Nigeria kind. I remember a story about direct load control in the Detroit area in the early 1920s or 30s. The utility would pay people to let it control their water heaters or other such load, using analog radio signals. People then figured out they could get paid but yet have no discomfort if they just put aluminum foil over the receiver!
The good news is the amount of load control we need to make a difference isn't much. Avoiding blackouts is cutting loads of maybe 5-10% or so. Saving 5% of PEAK electricity is (rule of thumb) some 25% of generation costs.
CISCO: SMART GRID WILL ECLIPSE SIZE OF INTERNET Cisco sees a $100 billion market opportunity in the smart grid. The company make communications equipment for the electricity grid -- everything from routers in grid substations to home energy controllers. Cisco's move is a sign that the creaky electricity distribution system is poised for a digital upgrade. Other high-tech companies, including IBM, Intel, and several start-ups, are ramping up smart-grid efforts to capitalize on expected investments from utilities and federal governments. Cisco estimates that the communications portion of that build-out is worth $20 billion a year over the next five years. The idea of the "smart grid" is to modernize the electricity industry by overlaying digital communications onto the grid. Smart meters in a person's home, for example, can communicate energy usage to utilities in near real time. That allows the utility to more efficiently manage the electricity supply and potentially allow a consumer to take advantage of cheaper rates.
Courtesy of the Benton Foundation