Smart Grid Basics

The Twilight of the Electric Grid?

Image from "DOE Reports Paints Bleak Picture Of Our Electric Future," by John Timmer, Ars Technica, January 19, 2009. Timmer's Ars Technica article comments on the DOE Electricity Advisory Committee January 9, 2009 report,
"Keeping the Lights On in a New World."

The USA’s electrical transmission infrastructure consists of nine thousand two hundred (9,200) power plants including fossil fuel, nuclear, hydro, solar, geothermal, wind, and biofuel plants, and facilities that combine these power sources. Collectively, these plants have an electrical generating capacity of more than one million megawatts (1,000,000 MW). The power plants are connected to more than three hundred thousand (300,000) miles of transmission lines.

The USA's electrical transmission infrastructure has grown to its current size and complexity over the course of a century. Nonetheless, the USA electricity “grid” is outdated because it relies on obsolescent technology and contains vast inefficiencies that have accumulated during the course of its construction. Further, the “grid” was never designed for a future of lower carbon emissions and the newer technologies of high-speed computers, the Internet, clean energy power plants and distributed generation (DG).

The USA Department of Energy (DOE) is in charge of “…orchestrating the wholesale modernization of our nation’s electrical grid.” The DOE Office of Electricity Delivery and Energy Reliability formed a Smart Grid Task Force under the Energy Independence and Security Act of 2007. The Smart Grid Task Force is to lead the “grid” modernization effort.

DOE recently contracted with Litos Strategic Communication to produce the report, “The Smart Grid: An Introduction.”

According to the DOE, “It is the first book of its kind to explore – in layman’s terms – the nature, challenges, opportunities and necessity of Smart Grid implementation.”

On page 2 of “The Smart Grid: An Introduction,” the authors say:

“Our nation’s electric power infrastructure that has served us so well for so long – also known as “the grid” – is rapidly running up against its limitations. Our lights may be on, but systemically, the risks associated with relying on an often overtaxed grid grow in size, scale and complexity every day. From national challenges like power system security to those global in nature such as climate change, our near-term agenda is formidable. Some might even say history-making.”

The new report treats:
• the history of our existing national electrical grid
• what the Smart Grid is and what it is not
• comparing and contrasting the Smart Grid with existing systems
• what must be done first in creating the Smart Grid
• what the working platform of the Smart Grid looks like
• which Smart Grid efforts now being employed are succeeding
• what is the average person’s stake in the Smart Grid, and
• resources and glossary to help people learn the principles and language applied to the new technology.

The report provides fundamental information and resources for investigating our emerging new-technology electrical generation and transmission infrastructure. It is a guide to thinking about questions emerging in our national debate over our new energy economy:

How much electrical capacity do we now demand?

How much electrical capacity will we demand in the future?

How many new power plants and power lines will we build?

How many obsolescent technology power plants must we replace and how quickly?

Where is it appropriate to construct new power plants, transmission, and other "grid" infrastructure?

“Smart Grid” thinking, in fact, can defer the demand to spend billions of dollars on new electrical power transmission lines. A “Smart Grid” that operates with the flexibility available from modern computing technology provides huge opportunities for employing distributed clean energy power generation (DG). DG systems provide a very rapid installation, “plug-and-play” input to our national grid. DG systems produce electricity from many small energy sources, and electricity is generated very near where it is used.

On May 18, 2009 U.S. Secretary of Commerce Gary Locke and U.S. Secretary of Energy Steven Chu issued a Press Release announcing progress on the USA Smart Grid, and "significant steps in Smart Grid development." Secretaries Locke and Chu "...announced the first set of standards that are needed for the interoperability and security of the Smart Grid and $10 million in Recovery Act funds provided by the Energy Department to the Commerce Department’s National Institute of Standards and Technology to support the development of interoperability standards."

"Secretary Chu also announced that based on feedback from the public and Smart Grid stakeholders, the Department of Energy is increasing the maximum award available under the Recovery Act for Smart Grid programs. The maximum award available under the Smart Grid Investment Grant Program will be increased from $20 million to $200 million and for the Smart Grid Demonstration Projects from $40 million to $100 million. In making awards, DOE will ensure that funding is provided to a diversity of applications, including small projects as well as end-to-end larger projects."

You may offer your opinions on and applications for developing the USA's "Smart Grid" by tracking and responding to posts on the web site of the National Institute of Standards and Technology.

Solar Power Milestones In 2009

Capturing The Energy Of The Sun, iStockphoto image in Science Daily, August 25, 2008.

The solar power industry continues its rapid evolution as evidenced by important milestones reached within the past few weeks. Progress in the solar power sector is being driven by practical economic, energy security, and environmental protection factors.

Guinness Atkinson Funds on December 31, 2008 for example argues that the long term prospects for solar power and other clean energies remain sound, in fact showing the potential to be one of the first sectors to emerge from the current financial downturn.

Guinness Atkinson invests in a wide variety of companies engaged in the production, exploration and discovery or distribution of energy, whether derived from fossil fuels or an “Alternative Energy” suite of solar, wind, hydro, efficiency, geothermal, biomass and biofuel.

Consistent with this appraisal, Suntech Power Holdings Co. Ltd. announced on January 9, 2009 that it has reached 1 gigawatt (GW) of solar photovoltaic (PV) cell and module production capacity in Wuxi, China. Suntech is the first solar photovoltaic company in the world to achieve 1 GW of solar cell and module production.

Suntech’s announcement comes in contrast to other companies that are scaling back production estimates for 2009 because of global credit and stock market declines. Suntech is headquartered in Jiangsu Province, People’s Republic of China, with offices in Schaffhausen, Switzerland; San Francisco, California; New South Wales, Australia; Munich, Germany; Madrid, Spain; Gangnam-gu, South Korea; and Tokyo, Japan.

In the United States, SunEdison on January 9, 2009 announced one of the largest solar distributed generation (DG) programs ever conceived. SunEdison is partnering in the venture with Developers Diversified Realty, a Cleveland-based real estate investment trust (REIT) engaged in the development and management of shopping centers.

Under the terms of the deal, SunEdison “…has the rights to deploy solar energy systems at more than 200 shopping centers, covering up to an estimated 30 million square feet. Potential capacity of the program is up to 259 MW and the centers are located in 24 states and in Puerto Rico.”

“Once a particular system is operational, Developers Diversified will be able to purchase energy from SunEdison. In addition, shopping center tenants can benefit and realize energy savings by opting to purchase the power generated through the program at rates lower than retail energy rates.” SunEdison spokesman Brian Jacolick stated, “…a typical sized solar energy system in the program will avoid an estimated 10 million pounds of carbon dioxide pollution.”

Also in the USA, the Solar Electric Power Association (SEPA) on January 7, 2009 released a new research report, “Facilitating Utility Use and Integration of Solar Electric Power.”

This report is based on work supported by the
US Department of Energy Office of Energy Efficiency and Renewable Energy through the Solar America Initiative.

The report contains two informative summary tables. One documents large-scale USA utility solar photovoltaic projects [those projects of more than 20 megawatts (MW)] either completed or in development as of September 2008. The second documents large-scale USA concentrating solar thermal power (CSP) projects either completed or announced as of July 2008.

The report says, “This year has seen an unprecedented number of utility-scale photovoltaic and concentrating solar thermal project announcements – some 3,000 to 5,000 megawatts over the next five years.

“However, SEPA believes this is only the cornerstone of what’s to come. The effect of the long-term extension of the federal investment tax credit—which includes eligibility for utilities—combined with the expansion of global solar manufacturing, rapidly declining cost and price curves, and federal and state environmental policies, is laying a foundation for utility solar innovation at unprecedented scales.”

The SEPA/DOE research offers critical insights into policy and procurement innovations that are possible with the solar power industry, but not possible with old technology power production and distribution. Because solar power is available everywhere the sun shines - albeit in greater or lesser degrees - utility companies are not limited to solar power solutions based on a central-station power generation, long-distance power transmission construct.

The SEPA/DOE report lists several benefits for utility companies to find ways to increase their portfolio of renewable energy in general and solar power in particular.

"Utilities need to compare solar costs with peak generation costs [and/or new plant acquisition] rather than base load [or avoided cost] electricity generation;

"The distributed nature of PV adds to grid reliability;

"The distributed generation of PV has limited transmission and distribution costs;

"Solar project developers actively pursuing residential and commercial customers to install their own solar generation are taking business away from utilities and driving utilities to acquire solar resources to remain competitive;

"In a carbon-regulated world, solar will offer utilities credits rather than costs that will be incurred for their carbon polluting generation;

"Increasing solar integration will be aided by and will in turn aid adoption of 'smart grid' technologies;

"Utilities improve their image to the public by taking voluntary environmental measures;

"Solar 'fuel' will remain free while costs of coal and natural gas continue to fluctuate in volatile markets.

"Although, historically, utilities outside of the Southwest have played a lesser role in the direct growth of solar power, within a decade solar power is expected to be cost-competitive in most regions of the U.S. on both a wholesale and retail basis.

"As utilities and others scale up their solar efforts, they are reaching economies of scale unlike anything seen in the past."

China Positions For World leadership In "Smart Grid" Applications

Hello, All -- This information was originally reported on November 13, 2008.

China, in its economic stimulus plan, invites investment in renewable energy and energy efficiency.

Notably, China seeks to modernize its electrical transmission grid by merging the existing electricity infrastructure with information technology -- the "Smart Grid" concept.

The article explains cooperative agreements between the USA and China, facilitated by the Joint US-China Cooperation on Clean Energy and involving major USA/International utility companies.

Note the plans for nationwide electric vehicle charging stations, and the involvement of General Motors of USA in this venture. Also note the investment opportunities for foreign nations in China's overhaul of its electricity infrastructure.

The article concludes, "China is in a unique position to develop the world's most advanced power distribution network by adopting smart grid technologies as it further develops and enhances its power grid. The question is whether China is willing to take the lead and be at the forefront of the "smart grid" revolution that is surely the future of worldwide power distribution."

The USA is well positioned to be a co-leader in the global effort to revolutionize our power sources and distribution systems. There is no better time than now to move ahead with this effort.


http://www.RenewableEnergyWorld.com/rea/news/story?id=54061&src=rss

Renewable Energy World/China

November 13, 2008

"Smart" Energy Management for China's Transmission Grid

by Lou Schwartz and Ryan Hodum

Beijing, China [RenewableEnergyWorld.com]

On November 9th the Chinese government approved a US $586 billion stimulus plan focused on large-scale investment in low-income housing, water, rural infrastructure and electricity in China. Though the primary purpose of this initiative is to spur economic growth at a time when exports are falling, as the Chinese stock market is in the doldrums and GDP growth is flagging, a secondary effect of this stimulus plan may be increased investment in renewable energy and energy efficiency in China.

This effort would include accelerating efforts to achieve the goal of reducing China's energy consumption per unit of GDP by a cumulative 20% by 2010. One very promising approach for China to build energy conservation into its infrastructure is the construction of a "smart grid."

The "smart grid" is the merging of electricity infrastructure with information technology. The purpose is to add monitoring, analysis, control and communication capabilities to any national electrical delivery system to maximize efficiency while reducing energy consumption. Creating a unified power grid and upgrading aging power systems will increase productivity, reduce carbon dioxide emissions and increase national security.

The Need for a "Smart Grid" in China

In 2002, China established five independent electricity generating companies and several transmission companies. The five generators have an equal share of the assets — China Huaneng, China Datang, China Huadian, Guodian Power, China Power Investment — and compete to sell electricity.

The State Grid Corporation of China (SGCC), the Southern Power Grid Corporation and the Eastern China Grid Corporation are among China's transmission companies. The largest utility in the world, SGCC serves 26 provinces and 1.08 billion people with a peak load of 343 gigawatts (GW) and total investment in grid construction valued at US $31.8 billion in 2007. China's second largest utility, China Southern Power Grid, is ranked 226th in Fortune Magazine's Global 500 listing with revenues exceeding US $30 billion.

Throughout China, the existing regional grids have weak interconnections between provinces and largely non-existent interconnections between grids. In order to solve this deficiency, the Chinese government has plans to create a unified national power grid network by 2020.

The plans include what is known as the "West-East Electricity Transfer Project," which requires the construction of three major west-east transmission corridors: North, Central and South. The transmission capacity of each corridor is expected to reach 20 GW by 2020. While planning for such major infrastructure investments, the government would be well-positioned to lay the foundation for "smart grid" capacity across the country.

The Eastern China Grid Corporation initiated a feasibility study of "smart grid" technology in October 2007. Shi Junqing, the General Manager of Eastern China Grid Corp. described the findings earlier this year. In terms of the large load on its grid, the assets that it has built into its system, the necessity of continuing to build out the network and the increasing environmental, safety, reliability and efficiency pressures that it faces, Eastern China Grid Corp. believes that the conditions are now ripe for it to put in place a smart grid system; to that end the company has established a goal of gradually putting in place the elements of a "smart grid" over the coming years.

International Collaboration on "Smart Grid"

Efforts to develop and deploy "smart grid" technology are underway across the globe, supported by industry alliances such as the GridWise Alliance in the United States, Smart Grid Europe, and Smart Grid Australia.

In the United States, for example, although the transmission grid is 99.97% reliable, brief power interruptions have cost the country nearly US $100 billion each year; apart from enhanced reliability, smart grids promise to increase efficiency of power distribution and usage, with corresponding savings in power and power consumption.

With respect to China, international cooperation that focuses on energy efficiency includes the efforts of the philanthropic arm of Google, which has awarded a grant of US $250,000 to the U.S. National Academies and the Chinese Academies of Sciences and Engineering to develop recommendations for U.S.-Chinese cooperation on renewable electricity - central to which is a focus on grid connectivity and energy storage.

The Joint US-China Cooperation on Clean Energy (JUCCCE), a non-profit organization that brings together international experts to accelerate the use of clean and efficient energy in China, has been selected by the Clinton Global Initiative to organize The China Smart Grid Cooperative. JUCCCE received US $770,000 to run this initiative and has plans to partner with international companies such as Duke Energy and GridPoint to accelerate "smart grid" development in China.

This week (Nov. 10-11), JUCCCE is convening the JUCCCE Energy Forum in cooperation with the Energy Foundation and the National Development and Reform Commission. The JUCCCE Energy Forum will include a presentation on smart grids by IBM and will surely afford the opportunity to further the efforts of JUCCCE to engage the leadership in Beijing to urge the development of a plan to develop a smart grid in China.

Business Opportunities for Foreign Companies

Opportunities exist for foreign corporations to benefit from "smart grid" investments in China. In March, American-owned Composite Technology Corporation announced an order valued at approximately US $3.1 million for high efficiency conductors. In June, ABB Ltd., a Swiss-owned manufacturer of power-generation equipment, won a US $70 million order for power equipment from the State Grid Corporation for a high voltage DC (HVDC) transmission link in northeastern China to transmit 3,000 megawatts (MW) from Inner Mongolia to Liaoning Province.

Siemens recently announced an order from China Southern Power Grid Corporation to build the first 800-kV ultra high voltage DC system able to transfer 5000 MW of power to load centers on the southeast coast. In addition, IBM has developed products to implement smart grids that it is promoting throughout the world, including in China.

"Smart Grid" Accommodates Breakthrough Technology

The State Grid Corporation of China (SGCC) has plans to create a nation-wide electric-vehicle charging network with charging stations currently installed in Shanghai, Beijing, and Tianjin to name a few. It was recently announced that General Motors is collaborating with the SGCC to meet Chinese market demand for the Chevy Volt.

However, without aggressive investment in "smart grid" technology, this initiative may stumble as it attempts to expand across the country. The plug-in electric vehicle will depend on network improvements as much as today's car depends on petrol stations, which will require sophisticated appliances to communicate oscillations in energy supply and demand.

Exporting Smart Grid Technology to Other Asian Countries

In addition to creating a "smart grid" infrastructure, China also has the opportunity to export "smart grid" best practices. Recently it was reported that the State Grid Corporation of China won a US $3.95 billion bid for a 25-year contract to manage the Philippines' electricity grid (arguably the largest privatization deal in Philippines' history). A significant opportunity exists for China to collaborate with the rest of the world on investing in the grid of the future.

China is in a unique position to develop the world's most advanced power distribution network by adopting smart grid technologies as it further develops and enhances its power grid. The question is whether China is willing to take the lead and be at the forefront of the "smart grid" revolution that is surely the future of worldwide power distribution.

Lou Schwartz is president of China Strategies LLC, and publisher of the China Renewable Energy and Sustainable Development Report and the China Aluminum Industry Report. He has degrees in East Asian Studies from the University of Michigan and Harvard University where he studied Chinese language and literature, economics and law, among other disciplines. Lou also earned a J.D. from George Washington University Law School.

Ryan Hodum is an environmental and renewable energy professional who recently earned a Master of Arts in Global Environmental Policy from American University in Washington, D.C. with a focus on renewable energy utilization in China. He now works for David Gardiner & Associates LLC, a strategic consulting firm focused on climate and energy solutions. Ryan spearheaded the development of China Strategies' China Renewable Energy Interactive Map and the China Solar Map, which can be found on China Strategies' website.

See: http://www.chinastrategiesllc.com/index.htm