Our next interview is with Saifur Rahman, Chair, Innovative Smart Grid Technologies Conference. He notes utilities that have been successful in Smart Grid deployments have exercised good planning, created business models that monetize Smart Grid, and have conducted extensive outreach to many audiences.
What is Smart Grid?
Smart Grid starts at the electrical power generator and ends at your refrigerator. It’s the whole span: generation, transmission, distribution, consumption and customer reaction to all these possibilities, See, it’s more of a culture than one thing that you go and buy.
What is your role or involvement in Smart Grid?
I have two roles, one as an educator researcher - we do work on developing hardware, software algorithms which makes or can make the Smart Grid practical, useful and affordable. I also run the US Energy Department-supported program called Smart Grid Information Clearing House Portal, which was developed with help from IEEE and EnerNex. Virginia Tech is the contractor, I am the principle investigator for that project. So our role is to collect information in the US and globally to see what deployments have happened, what are the technologies, what are the regulations, what are the best practices, so we can bring that information to the attention of the common public, regulator, policy makers, utility engineers and investors.
Who are the stakeholders in Smart Grid and how will they stand to benefit from the evolution of the Smart Grid?
We start at the bottom, which is the end user, and ultimately the end user, the home owner, small business owner have to see both convenience and monetary benefit from deploying Smart Grid. So this is where I’ll start, but they don’t make it happen. Who makes it happen? Three parties. One is the technology providers, the hardware people, second is utilities who will deploy it, and third is the regulator who will make it possible for deployment. Like in the US, utilities are regulated, primarily. That means what? They have to get money from the regulators or allocation to invest, so regulators have to see..see how this is interconnected. Regulators have to see that there is a benefit to their customers, which is the public. Now regulators are mainly elected or appointed by the state administration. So they are very sensitive to customer reaction, customer perception, and customer value. So all are interconnected. So that’s why I always come back to the customer. If customer is on board they will tell the regulator why don’t you give them 10 bucks a month extra, let them buy this smart meter, my life is easier. So that is the starting point. So stakeholders are customer technology provider, regulator, and the deployment people, which is the utility. So they start at the customer base. So that is why just to expand on that thought I believe Smart Grid in the US and globally will only be successful and sustained if and only if we can make the customer believe in this and that is a big challenge and that’s why education, awareness, customer value has to be put forward.
What does IEEE bring to the Smart Grid?
IEEE being three things: IEEE is an organization, which brings people together on one single platform, people meaning technologists, regulators, utilities and end users. So IEEE can be that platform where we can reach out to these people as an honest broker, keeping in mind IEEE has no stake in this. So nobody can see it doing this because you want to make this and that. So we are totally unbiased at the same time fully cognizant of the technology, regulation, customer needs and end user expectations. So IEEE does play a major role in starting this conversation among different groups, who don’t talk to each other normally. Number two is IEEE has a huge technology base through its big volunteer base. So these volunteers can and do come to the table, spend their own time and resourses to discuss these issues and help to identify and provide directions that companies, even regulators, can take advantage of to guide the thinking so that we are moving expeditiously but not blindly, that is very important. Expeditious but not blind. You can talk to everybody but not just talk, move ahead.
What are the economic and regulatory issues that Smart Grid faces?
First thing is Smart Grid is not free, it is not cheap. To make it practical we have to invest. When you use the word investment, the first question that comes is who will invest and why. And where is the money coming from. So if I as a home owner have to buy $500 worth of Smart Grid gadgets to make it possible, I will probably say no. But if there is a program that is supported by the utility, required by the regulator, that the power company has to find some way to invest this money and they charge me five bucks a month to get it back, I am happy with it. So this is the issue. Somehow the regulators will have to find a way to find the money so that customers are not bearing the first costs right away.
Do you see any killer apps for the Smart Grid?
It depends what you expect the Smart Grid to do for you. In the US and many countries we have a serious issue with peak demand. Very hot summer afternoon. Happened in DC recently. The load goes over 10-15%. As a result, because power companies are required to maintain enough reserve to meet such unexpected events. In the US 20% of the resources are used only 5% of the time. That means what? If you could avoid that 5% we can save 20%. That’s literally a trillion dollar-plus investment. So what Smart Grid can do because it has the opportunity to control load by managing things more intelligently. For example at your house, in the US at least, you can bake your cake, dry your clothes, wash your clothes, take a hot shower, run the air conditioner at the same time – nobody stops you. If you did that, if everybody did that, it would blow up the transformer. So the power company has to be ready in case there is some street that might do that, so they get extra power just in case. We don’t need that always. Smart Grid through a smart meter, for example, can monitor these and see if there is a potential capacity shortage. Rather than bringing more capacity, can the Smart Grid or smart meter monitor these devices and turn something off which can be turned off without any inconvenience to the customer. So the killer app is load control at the customer level so that the peak demand can be avoided. And to that you add your issue of electric vehicles. If you add electric vehicles to this mix, you are adding another load that can be problematic in some cases. So, for example, you came home at 6 o’clock from work, brought the car to the garage, plug it in for charging, and your wife or husband is still cooking, your air conditioning running, you want to take a hot shower and maybe they are drying clothes as well. So, what I’m looking at is some research we do at Virginia Tech that will monitor these in real time and see, when I come into the house, plug it in, it will notice what else is going on and if it notices everything else is on, it will not turn the car on unless I override, you know, I have to go to a dinner at 8 o’ clock, then it will turn my electric clothes drier off. So the killer apps are these end use devices, which will monitor in real time what’s happening such that the overall load is under a threshold that the power company can live with.
What should consumers know about Smart Grid?
Consumers know the term but they don’t know what it is in many, many cases. In my work with the Smart Grid information Clearinghouse I talk to many consumer groups, regulators, state agency people and they say it sounds fine but what does it do for me? I know that in some cases power companies have come in and put in smart meters. They know that, that’s fine. What they need to know is first, what is the benefit before the cost. Because I have seen in many power companies I have talked to, they have deployed smart meters. I said what is it doing for the consumer? Well, it controls voltage, reducing energy, but you pay, summer months, I pay a $250 electric bill per month. If you drop about 3%, I don’t even notice it. That’s what they are talking about. So we have to go beyond that. It is a significant education campaign, what is possible, not what is happening today, and see how people react. If you them possibilities of multiple units of tens of dollars, lets say $40-50 per month, then they give attention to these numbers. So, to answer this, education, awareness and best practices, what is possible. The biggest concern I have with the education issue is people get scared. They talk about Smart Grid means more automation, more cyber security, more Internet-based systems and they could be unreliable. So those have to addressed very, very carefully.
What do the utility companies need to do to get their customers on board with Smart Grid?
They have to look at different customer demographics, like early adopters. It’s happening in some parts of the country because you cannot roll out the program for everybody because people’s expectations are different, their saving amounts are different, their ability to react is different. So we have to first of all give the option to the customer that this is possible for you and then they have to follow up. See what happens, in the US at least, you get these bill inserts, you get electric bills and find that in there and I just throw that away frankly speaking and most of them do that. So it’s not working. So you have to go beyond that. A bill insert is the beginning, then they have to phone call follow up or they do demographics. There companies in the US now, multiple in Virginia, who do this job. They look at the usage profile of different customer demographics, the load shape, annual consumption, peak day consumption and figure out what they are doing. So this is a smart way to do this. Some companies are getting into the business that do a remote demographic analysis and target customers. Once you can show that there are people who are taking advantage of this and they are willing to pay for it then the power company has a market to scale up.