Interview with Wanda Reder
Wanda Reder, Chair IEEE Smart Grid Task Force, past-president IEEE PES (Power & Energy Society), and vice president of the Power Systems Services Division at S&C Electric Company sheds light on where Smart Grid stands today and what’s envisioned for the future.
Question: Is Smart Grid a new concept?
What’s important to remember is that Smart Grid has been an ongoing, long-term evolution, and we have actually been making the grid smarter for 100 years. In fact, in 2000, the U.S. National Academy of Engineers rated the electric grid as being the major engineering accomplishment of the 20th century. While this might have inadvertently created a public perception that the Smart Grid exists here and now, in reality, the journey towards a true Smart Grid is ongoing.
Today, Smart Grid initiatives are challenging traditional utility norms that go far beyond planning tools and analytics. There is also a need to better understand customers’ roles and to determine their educational needs, as well as gauge their level of interest to participate in the process. Doing this is key to developing an overarching Smart Grid game plan –one that is built logically around sound incentives, standards and policies.
Question: How will Smart Grids become a reality around the world?
Clearly, there is a vast amount of recognition that Smart Grids provide benefit to society, by reducing carbon footprints, increasing energy efficiencies and facilitating “green” more environmentally sound initiatives. However, today we’ve yet to establish clear priorities for Smart Grids, and that’s something key to making them become a reality. Otherwise, initiatives, actions and corresponding resources cannot appropriately be sequenced or weighed against one another to achieve the desired outcomes. An effective strategy requires first determining clear priorities in order to deploy Smart Grids in a more organized and efficient way.
For example, the installation of a lot of automated meter reading has been a tactical first step in Smart Grid work. And, while that’s something positive, the meters provide even greater benefit if enabled to provide time-of-use rates or to indicate the cost of generation and delivery so consumers are informed about the true difference between high and low cost periods – something that could impact their usage decisions. It’s critical to have those rates for consumers to realize benefit. Some states have them; some don’t. Frankly, it’s one of the key enablers to move the whole Smart Grid vision forward.
Energy storage is another area of importance in Smart Grid development. Using renewable power sources and different applications for storage can help stabilize the grid. Currently, we rely on spinning generation reserves, and we are only able to reduce carbon emissions to the degree we are able to use storage that can come on- and off-line quickly. What we’re missing today are mechanisms and incentives to allow fast-storage technologies to play in the marketplace. In short, there are no assurances that utilities will get paid back for deploying new fast storage applications. In effect, the market realities are built around what we have been doing in the past, and now changes are needed in some cases to recognize the incentives required to support future development.
Developing community energy storage is another example of enhancement to the Smart Grid. Envision a neighborhood where the majority of homes have solar panels, potentially providing individual power needs for heating, appliances, electric vehicles, etc., with excess power funneled to a battery that is connected on the load side of the transformer that feeds the neighborhood at large. This can store excess power when it is not needed and discharge it when there is high demand. It also improves reliability, reduces losses, improves grid utilization and provides local voltage regulation. You also have the ability to control several of these types of storage units in a cluster, making for yet another generation source.
In the United States, and around the world, regulations to accommodate various battery storage systems are evolving to support greater grid reliability. However, a hurdle that needs to be overcome is determining just who exactly has regulatory jurisdiction when it comes to battery storage. Because these storage applications bring a value proposition for distribution, transmission and wholesale markets, as well being capable to serve as a generation source, there is a degree of uncertainty regarding approvals and associated investment. In fact, pilot installations have pointed to federal and state regulatory gaps and overlaps that are creating an impediment to developing and financing storage installations. Fortunately, the lessons learned are proving useful to better understand the costs and benefits to get rate recovery for storage located on the distribution system.
Improved energy efficiency is another consideration. Today, we lose 15 to 18 percent of power from generator to meter, and those power losses get passed down to the consumer. The biggest energy consumers are, in fact, electric utilities. The more times power is sent through a transformer, the greater the loss. There are techniques to reduce the losses, such as using more capacitor banks and control algorithms to flatten the voltage profile along a distribution feeder. Doing this slightly reduces the overall voltage of the feeder, resulting in less energy consumed and fewer system losses. The current challenge is utilities have no incentive to implement this practice, since consumers pay for every kilowatt-hour used, covering losses. For distribution companies to pursue these techniques, changes need to be implemented to encourage more efficient forms of delivery.
Similarly, a system could be established that rewards those utilities that improve reliability. The standard definition of an outage right now is one that lasts for five minutes or more. If power is lost for just a minute, in many cases it’s not counted as an outage. Yet, we now live in a digital world where companies are moving a mind-boggling amount of data in just milliseconds. Hence, grid modernization is intimately tied to our economic viability. Today, automated distribution technology can reconfigure around faults, meaning that we should be able to set standards so that an outage is defined as being much less than five-minutes in duration. That will require setting policy that encourages tightening reliability thresholds.
Clearly, there must be a direct line-of-sight for policy change and getting to the long-range mission that we define for Smart Grid.
Question: What should industry be doing to make smart grids a reality?
Collaboration is key with the knowledge that we are all working towards a greater goal. The industry, as a whole, should take a proactive stance in sharing lessons gained from government-funded demonstration projects – funding that was unprecedented and likely never to be seen again. By holding each other accountable to freely share lessons learned we can provide more benefit to society. By focusing on distributed generation, renewable energy sources, enhanced storage applications, demand response and electric vehicles, we can make a fundamental paradigm shift in our assumptions about power generation, distribution and its usage. This includes multi-directional power flow, and it has dramatic implication on how the power system is designed, operated and maintained.
These lessons need to be incorporated into roadmaps for future deployments, standards development and policy reforms that remove existing barriers for deployment. Industry’s role is critical to leveraging the findings in order to advance the overall cause, and IEEE is facilitating collaboration, education, the free exchange of information and sharing of best practices among smart grid experts and novices alike.