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Five Smart Grid Trends: Here to Stay

2012 was a huge year in Smart Grid throughout North America in terms of deployments and adoption. With 2013 almost halfway over, the Smart Grid marketplace has seen several major trends begin to anchor themselves and take root. What can we expect to see during the later half of 2013?

One mega trend is the driving force pushing five smart grid trends: load leveling. Load leveling is the process of shortening the peaks and valleys of the demand for electricity. By leveling out the demand, power plants are able to run closer to their peak efficiency.

And, the five trends being pushed forward by load-leveling:

1st: Digital Substations. Introduced in 2004, the Intelligent Electronic Commission or IEC 61850 standard is increasingly being accepted around the world and interoperability is now a reality for the substation industry. The Intelligent Electronic Devices (IEDs) that are connected in the digital substations are now able to communicate over the grid system to provide greater transparency, higher reliability and efficiency of operations. With greater visibility into the grid, the utility is able to make more actionable decisions.

2nd: Distributed Energy Generation. In the past, when people have generated their own electrical energy needs, it had been for emergency situations or for back up in hospitals or other industrial buildings. Currently, North American utility companies are offering an increasingly longer list of energy supply options including distributed generation. The most common distributed generation technologies include wind and solar photovoltaics (PV).

Customers can now help trim their energy bill (and possibly help the utility clip their peak load time) by providing their own energy and even feed energy back into the grid. The rise of a new term, “net metering,” has also come onto the Smart Grid scene. Net metering is an electricity policy where consumers are deducted of any energy outflows are deducted from energy inflows. In layman’s terms, in net metering, a consumer receives a credit on their energy bill for the electricity they generate and put back into the grid.

3rd: Distributed Energy Storage. An upcoming solution for distributed energy storage is what is being called vehicle-to-grid or V2G. Although this is only a proposed solution, the step forward is important. Electric cars or plug-in/hybrid electric vehicles (PHEV) have large batteries that are charged at home and are able to store energy.

Electric vehicles and other distributed energy storage devices can take advantage of dynamic pricing. Dynamic pricing means they can charge and store energy when prices are low and supply the energy when prices are high. From the perspective of a utility, distributed storage provides peak shaving and load leveling programs, which is their overarching goal.

4th: Advanced Metering Infrastructure. You can’t talk about smart grid trends that are here to stay without mentioning Advanced Metering Infrastructure or AMI. Advanced Metering Infrastructure most often refers to the measurement and collection system that includes meters at the customer site. Additionally, communication networks between the customer and a service provider are included, as well as data collection and management systems that make the information available to the service provider.

In 2011 and 2012, the Northeastern United States was hammered by two major storms, yet areas that were equipped with AMI’s were able to restore outages to 95 percent of their customer’s within a day.

Although this is an impressive accomplishment, the real motivation behind AMI is to provide the utility and the consumer the information resolution needed to change behavior through time-of-day metering and peak demand charges in order to help levelize the utility’s load and enable the power plant to run more efficiently.

5th: Backward Compatibility. An unfortunate reality that all smart meter companies have to take into account is backward compatibility. Due to the large install base and the ever-changing Smart Energy Profile requirements, backward compatibility is a trend that will not be fall by the way side any time soon.

The concept of load leveling is to make not just North America, but the world’s increasing thirst for electric energy backward compatible with the limited and aging infrastructure. This is often referred to as sweating the assets. By sweating the assets, you are collectively maximizing the value harvested from business assets. In this case, by having smart meters that are backward compatible, they are increasing the value of the business assets and generating recurring income because they do not need to be replaced.

Load leveling and these corresponding trends are just one piece of the puzzle. Hopefully, these trends are helping change consumer behavior and ultimately help drive down costs.

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