The B2B platform for full-electric and plug-in hybrid electric vehicles: Industry News

In its recent Smart Grid System Report, the US Department of Energy attempts to outline the main challenges and potentials smart grid systems are currently faced with. Compiling input from workshops, interviews, previous reports, it identifies key factors that will play a crucial role in the future of smart grids.

With the objective to improve reliability, operating efficiency, resiliency to threats, and impact on the environment, smart grids hold a great potential in the light of current efforts to reduce energy dependency and waste.

The report is a compilation of collected data from interviews, research of existing smart grid literature and studies. Is also covers the findings of a workshop sponsored by The Department of Energy: “Implementing the Smart Grid,” that gathered stakeholders from utilities, reliability coordinators, electricity market operators, end users, suppliers, trade organisations, state and federal regulators, the National Institute of Standards and Technology and the Federal Energy Regulatory Commission.

Below are some of the main findings the report presents.

Challenges

Costs: Among the significant challenges facing development of a smart grid are the cost of implementation, with estimates for just the electric utility advanced metering capability ranging up to $27 billion, and the regulations that allow recovery of such investments. For perspective, the Brattle Group estimates that it may take as much as $1.5 trillion to update the grid by 2030. Ensuring interoperability of smart-grid standards is another hurdle State and federal regulators will need to leap.

Technical barriers: Major technology barriers include developing economical storage systems; these storage systems can help solve other technical challenges, such as integrating distributed renewable-energy sources with the grid, addressing power-quality problems that would otherwise exacerbate the situation, and enhancing asset utilization. Without a smart grid, high penetrations of variable renewable resources may become more difficult and expensive to manage due to the greater need to coordinate these resources with dispatchable generation and demand.

Uncertainty: Another challenge facing a smart grid is the uncertainty of the path that its development will take over time with changing technology, changing energy mixes, changing energy policy, and developing climate change policy. Trying to legislate or regulate the development of a smart grid or its related technologies can severely diminish the benefits of the virtual, flexible, and transparent energy market it strives to provide. Conversely, with the entire nation’s energy grid potentially at risk, some may see the introduction of a smart grid in the United States as too important to allow laissez-faire evolution. Thus, the challenge of development becomes an issue of providing flexible regulation that leverages desired and developing technology through goal-directed and business-case-supported policy that promotes a positive economic outcome.

Main findings

Distributed energy resources: The ability to connect distributed generation, storage, and renewable resources is becoming more standardised and cost effective. While the penetration level remains low, the area is experiencing high growth. Several other concepts associated with a smart grid are in a nascent phase of deployment these include the integration of microgrids, electric vehicles, and demand response initiatives, including grid-sensitive appliances.

Electricity infrastructure: Those smart grid areas that fit within the traditional electricity utility business and policy model have a history of automation and advanced communication deployment to build upon. Advanced metering infrastructure is taking automated meter reading approaches to a new level, and is seen as a necessary step to enabling dynamic pricing and consumer participation mechanisms. Though penetration of these systems is still low, the growth and attention by businesses and policymakers is strong. Transmission substation automation remains strong with greater levels of information exchanged with control centers. Cost/benefit thresholds are now encouraging greater levels of automation at the distribution substation level. While reliability indices show some slight degradation, generation and electricity transport efficiencies are improving.

Business and policy: The business cases, financial resources, paths to deployment, and models for enabling governmental policy are only now emerging with experimentation. This is true of the regulated and non-regulated aspects of the electric system. Understanding and articulating the environmental and consumer perspectives also remains in its infancy, though recent reports and deliberations indicate that significant attention is beginning to be given to these issues.

High-tech culture change: A smart grid is socially transformational. As with the Internet or cell phone communications, our experience with electricity will change dramatically. To successfully integrate high levels of automation requires cultural change. The integration of automation systems within and between the electricity delivery infrastructure, distributed resources, and end-use systems needs to evolve from specialized interfaces to embrace solutions that recognize well-accepted principles, methodology, and tools that are commonly recognized by communications, information technology, and related disciplines that enable interactions within all economic sectors and individual businesses. The solutions to improving physical and cyber security, information privacy, and interoperability (conveniently connect and work within a collaborative system) require disciplines and best practices that are subscribed to by all stakeholders. A cross-disciplinary change that instills greater interaction among all the stakeholders is a necessary characteristic as we advance toward a smart grid. Progress in areas such as cyber security and interoperability is immature and difficult to measure, though improved approaches for future measurements are proposed.