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An Introduction
to the Smart Grid
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Envision a Smarter Electric GridNew strategies, communication and
information flows, technologies,transaction structures, and control of
the electricity system in order to:
Lower costs and give more
choices for consumers Improve system reliability and
efficiency
Modernize the energy
infrastructure Change the way humans
manage their energy footprint
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How Does the Electric Grid
Work Now?Traditional Power System: A One-Way Process
Source: EPRI 2011
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What is the Smart Grid? According to US Department of Energy (DOE):
Smart Grid is the term used for an electricity deliverysystem that is integrated with modern digital andinformation technology to provide improved reliability,security, efficiency and ultimately lower cost to the user.
According to Electric Power Research Institute (EPRI): The Smart Grid is envisioned to provide the enhancements
to ensure high levels of security, quality, reliability, andavailability (SQRA) of electric power; to improve economic
productivity and quality of life; and to minimizeenvironmental impact while maximizing safety andsustainability.
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Why All This Interest In Energy? Electricity is one of the largest and most capital-intensive sectors of the economy.
Total asset value is estimated to exceed $800 billion, with approximately 60% invested in power plants,30% in distribution facilities, and 10% in transmission facilities.
Annual electric revenuesthe Nations electric bill are about $247 billion
Paid by Americas 131 million electricity customers, which includes nearly every business and household.
There are more than 3,100 electric utilities and, there are nearly 2,100 non-utility power producers,
including both independent power companies and customer-owned distributed energy facilities.
There are a lot of risks we face by staying on the current path. Uncertain access to fuel resources cost may go out of control
Increasing harm to the atmosphere global warming may change the planet
Unpredictable power outages cascading grid failures disrupt commerce
Poor utilization of economic capital unnecessary cost increases for energy users
The concept of the base requirements for the smart grid is significantly more
expansive today than it was seven years ago - EPRI, 2011 technical report an investment level of between $17 and $24 billion per year will be required over the next 20 years.
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Challenges For Utilities The present electric power
delivery infrastructure was notdesigned to meet the needs of
a restructured electricity
marketplace.
the increasing demands of a highly
connected digital society
increased use of renewable powerproduction
High concentrations of significant
load and generation potential in
the commercial and residential
environment
vulnerability to various security
threats
In addition, investments inexpansion and maintenance are
constantly being challenged
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Why is Smart Grid Important?
Fundamental shift in how electricity isgenerated, distributed, and consumed.
Done right, and early, Smart Grid will be a
major new economic driver .
A major enabler of energy independence,
green house gas reduction and the shift away
from fossil fuels.
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Smart Grid Benefits Allows Direct Participation by Consumers.
The smart grid consumer is informed, modifying the way they use and purchase electricity.
Accommodates all Generation and Storage Options. The Smart Grid accommodates all generation and storage options.
Enables New Products, Services, and Markets. The Smart Grid enables a market system that provides cost-benefit tradeoffs to consumers.
Provides Power Quality for the Digital Economy. The Smart Grid provides reliable power that is relatively interruption-free.
Optimizes Asset Utilization and Operational Efficiently. The Smart Grid optimizes assets and operates efficiently.
Anticipates and Responds to System Disturbances (Self-heal).
Independently identifies and reacts to disturbances and performs mitigation efforts.
Operates Resiliently against Attack and Natural Disaster. The Smart Grid resists attacks on both the physical and cyber infrastructure.
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Source: EPRI 2011 Technical report
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Who Will Benefit? Utility customers
Local investors
Distributors of electricity and
their suppliers
Distributed generation suppliers
Labor unions Utilities
Industry
Entrepreneurs
EV manufacturers anddistributors
Universities
And Much MORE
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Smart Grid Attributes
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In addition to the obvious
benefits achieved by thisenhanced functionality it isnow obvious that othersubstantive benefits willaccrue once the Smart Grid isimplemented.
Chief among these is:1. reduction of peak demand,2. adoption of electric
vehicles,3. use of storage, and the
increased use ofrenewable powerproduction.
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Examples of Smart Grid
Economic Benefits Accelerated wind integration
More exportable energy/RECs
Exportable technology and business processes
Accelerated EVs as storage and ancillary services Reduced costs of EV operation and ownership
Exportable technology and business processes
Advanced commercial building DR, monitoring and
EE integration Reduced building operating costs
Exportable technology , business process and financing models
Attraction of researchers
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Elements of a Smarter Grid
Source: US DOE, Smart Grid System Report, 2009
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Critical Smart Grid Elements Networking capabilities to provide real-time
understanding of grid status Enables prompt correction of system disturbances, and to ensure
interoperability among grid elements
Meters, sensors, controls and monitoring technologies to allow for smart energy management, remote reading, fault detection,
and tailored pricing options
Electric vehicles, water heaters, appliances and
building energy management systems used to smooth system peaks, integrate wind and hydropower, and to
avoid cascading faults
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Smart Grid Things to Work On
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Its Time to Think Different
While the Smart Grid will utilize the latesttechnology to achieve its goals, it is not just
about technology.
Implementation of the Smart Grid will require acomplete rethinking of the public policy,
technology application, utility business models,
business processes and consumer behavior.
This is a real paradigm shift!