What the heck is a smart grid anyway?

By Elisa Wood

August 27, 2009

You know the old adage, ‘Never talk about politics or religion in polite company’? I’m beginning to think we need to add a third restraint, one against debate over the meaning of smart grid.

Okay, it’s not exactly a dinnertime topic. But I’ve discovered in gatherings of energy nerds (I’m one), discussion can become fairly heated over what constitutes “smart grid.”

On the one side are the engineering purists who stick to what I believe was an early definition: automated two-way communication on the grid by way of digital technology. At some point this came to widely include a smart meter that lets your utility ‘talk’ to your house and your house talk back.

On the other extreme, are those that seem to use the term to describe any grid innovation, particularly green or energy efficient technologies. It doesn’t even have to be a new technology. Combined heat and power is sometimes included in the smart club and it is more than 100 years old. (But then, just because something is old, doesn’t mean it’s not smart.)

Sometimes solar panels are described as smart. (They become stupid on the rare occasion when they leak.) And demand response, probably rightly so, has secured its position as part of the wired Mensa club. Integrating wind energy into the transmission system is often cited as a reason we need a smart grid.

It seems important that the industry stop fumbling with this definition. As Jesse Berst said in an excellent article, published March 5, 2009, SmartGridNews.com: “Can you imagine if an automobile CEO began his bailout plea with “I don’t really know what an automobile is, but can I have $20 billion please?” Or if the CEO of CitiGroup began a speech with: “I don’t really know what a bank is, but…” http://www.smartgridnews.com/artman/publish/commentary/Why_the_Smart_Grid_Industry_Can_t_Talk_the_Talk_and_What_to_Do_About_It-530.html.

Here are a few definitions of smart grid that show the range of thinking. Please let me know what you think and post yours as well. Virtual table pounding acceptable; no name calling please!

*“A smart grid delivers electricity from suppliers to consumers using digital technology to save energy, reduce cost and increase reliability and transparency.” Wikipedia

*“In terms of transmission, a smart grid makes it easier to deliver alternative energy sources like wind and solar from rural installations to city centers.” Ariel Schwartz, http://www.inhabitat.com/2009/04/30/energy-101-what-is-a-smart-grid/

*“Smart grid is a transformation. Just as the Internet revolutionized communication; the smart grid will transform how we produce energy, how we transport energy, how we store energy and how we use energy.” GridWise Alliance

*“The Smart Grid isn’t a thing but rather a vision and to be complete, that vision must be expressed from various perspectives – its values, its characteristics, and the milestones for achieving it.” Joe Miller http://www.smartgridnews.com/artman/publish/commentary/What_Is_the_Smart_Grid-567.html

*“Smart grid is the new big thing in the world of green…” http://www.treehugger.com/files/2009/07/amsterdam-smart-grid-pilot-project-ibm-cisco.php

*“While many conversations about the Smart Grid center on communications and metering technologies, the actual definition of Smart Grid is much broader and encompasses grid infrastructure — the brawn as well as the brains.” American Superconductor.

*“Over the past twelve months, Smart Grid has matured from a marketing buzzword to an industry strategy, with everyone from electric utility providers, to consulting and solution firms, to our country’s executive and legislative leaders referencing it as a key strategy for any number of objectives. Experts seem to agree that the Smart Grid is past the tipping point; however, agreement on strategy doesn’t necessarily constitute an agreement on deployment tactics.” http://www.smartgridroadshow.com/2/

Visit Elisa Wood at http://www.realenergywriters.com/ and pick up her free Energy Efficiency Markets podcast and newsletter

Smart grid and stupid buildings: Can this marriage survive?

By Elisa Wood 

August 20, 2009 

Smart grid is still in its honeymoon phase. Hardly a day goes by without fanfare in the news about how it will reform building energy use. Maybe so. But for the marriage of smart grid and US buildings to work, someone’s got to change. Is the stupid building up to the task? 

“Wiring the Smart Grid for Energy Efficiency,” a white paper by Oregon-based Portland Energy Conservation Inc (PECI), brings us down to earth by pointing out how much transformation is required.  

First, the bill. Smart meters alone will cost about $35 billion to install in 140 million U.S. homes and small businesses. Estimates are that nationwide, we’ll need to spend $400 billion to $900 billion to create a truly smart grid. Sure, forecasts Indicate smart grid will more than pay for itself. But where does the upfront capital come from? 

Second, many of our buildings wouldn’t know what to do with a smart meter. Their control systems are not up to the task. This could spell trouble if the systems are not improved before smart devices are installed. “Imagine if a building was called upon to reduce load, and while all the controls were in place to raise the temperature setpoint throughout the building to 76°F, this action results in four offices overheating to 83°F due to the need for air distribution system maintenance and sensor calibration,” the PECI paper says. 

Third, how do we achieve “true interoperability of communications,” or rather, get the smart grid and stupid building to talk? This will require development of a common language, still in the works. “In residential applications, grid-aware appliances will become widespread only if they are easy to install. For example, a washing machine that receives a price signal from the electric grid and correspondingly makes decisions about whether to operate should be able to be installed by a homeowner or by a contractor without expensive set-up costs. This kind of plug-and-play operation requires that the appliance automatically operates with the utility’s communications network as well as any home energy monitoring system.” 

Automation will be crucial. Or at the least, data display must be understandable and compelling. The report points out that consumers already suffer from information overload, so are unlikely to take the time to respond to price signals without strong incentive. Worse, consumers might treat energy savings like “a fad diet rather than a lifestyle change,” making it difficult for our society to achieve lasting energy savings.

We’ve yet to come up with the “killer application” to make smart grid a mass-market product, like what email did for the Internet. Further, we’re entering this new terrain with a lack of experienced building performance engineers.

The report does not say smart grid won’t live up to its promise of achieving dramatic energy savings. Quite the contrary. Smart grid may be one of the most brilliant ideas of our time. But we must proceed soberly.

The white paper is available athttp://peci.org/About/smartgrid_whitepaper_final_071709.pdf.

Visit Elisa Wood at http://www.realenergywriters.com/ and pick up her free Energy Efficiency Markets podcast and newsletter

Is waste heat the silver bullet?

By Elisa Wood

August 13, 2009

The energy industry tends to get stuck on certain words. Silver bullet is one of them. Insiders and policymakers often like to say there is no silver bullet to fix US energy woes. We need a portfolio of solutions – renewables, efficiency, smart grid, transmission expansion, coal sequestration, etc.

That may be true, but Tom Casten begs to differ. Casten is a bit of a rock star in the field of decentralized power. He has more than 30 years in the business and leadership positions in key organizations. It’s not unusual to see him quoted on energy not only in the trade press, but also in magazines like Forbes. So folks looking at alternatives tend to listen to him.

“I think there is a silver bullet, and I think it is all about the way the world makes power,” he said at the International District Energy Association conference in June. (Listen to his presentation at www.districtenergy.org.)

Or rather, it’s about the way the world wastes energy.

“Generation inefficiency is the elephant in the room. Nobody talks about. We put all kinds of policies into doing other things and ignoring that because most of industry makes money on this inefficiency,” he said.

The inefficiency he describes is the waste heat that power plants emit. It accounts for about two-thirds of plant fuel use, and it ends up floating into the sky unused. Weirdly, we know how to solve this problem, we have for decades – through combined heat and power plant. These plants marshal the waste heat and pipe it, so that it can be used for other purposes, such as steam energy for a college campus or an industrial process.

We use combined heat and power to generate only about 80,000 MW, about 9 percent of US total electric capacity. Of course, combined heat and power doesn’t make sense in all circumstances. But an Oak Ridge National Laboratory study released in December says the US could increase combined heat and power to 20% of capacity. Some Europeans countries have achieved this level –and they lack the large number of factories found in the US that can use the waste heat.

ORNL says it would take some regulatory tweaking to move the market to 20%. But one thing is for certain, there is no lack of interest in combined heat and power these days. The US Department of Energy recently offered $156 million in grant money for combined heat and power projects. By the time bids closed in mid-July, the DOE had received 359 applications for projects totaling $9.4 billion, according to Rob Thornton, IDEA president. “We knew it was going to be oversubscribed, but we never envisioned it being a 25 to 1 ratio,” he said.

Whether waste energy will emerge as the silver bullet remains to be seen, but clearly there is no longer a shortage of those aiming this bullet toward its target, the elusive werewolf of inefficient energy.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter

Carbon cap and boom?

By Elisa Wood

August 6, 2009

If we try to reduce greenhouse gases, the economy will take a hit, according to conventional wisdom. The Energy Information Administration bolstered the notion this week by reporting that energy prices would rise for the average US family by $142 in 2020 and $583 in 2030 under the House cap and trade bill passed in late June.

Steven Chu, US energy secretary, tried to soften the blow by saying that the carbon invoice amounted to less than a postage stamp per day. But cash-strapped US households are counting their postage stamps these days and finding they have none to spare.

So if cap and trade truly increases costs, it may be a tough sell to the American public when taken up by the Senate in September. But must we take an economic hit to revamp our energy supply?

The American Council for an Energy Efficient Economy offers an interesting twist on the conventional thinking about the cost of carbon reduction. If we do it right, we could actually better the economy, the organization says in its report, “The Positive Economics of Climate Change Policies: What the Historical Evidence Can Tell US,’ by John “Skip” Laitner, an ACEEE senior economist.

Laitner provides some interesting historic detail to underscore the argument that energy efficiency can reduce greenhouse gases without breaking the bank. Efficiency is not only relatively cheap, but it also creates a more productive economy. Consider this: The US has expanded its output threefold since 1970 and doubled its per capita income, yet the nation only increased its demand for power by 50% because of energy efficiency.

To give perspective on what this means, Laitner converted our energy use into equivalent gallons of gasoline. Today we use the energy equivalent of 2,600 gallon of gasoline per resident; had we not imposed greater efficiency, we would be using the equivalent of 5,500 gallons per person.

So, we have reduced our “energy intensity,” the amount of energy it takes to support a dollar of economic activity. “This decoupling of economic growth and energy consumption is a function of increased energy productivity: in effect, the ability to generate greater economic output, but to do so with less energy,” the report says.

Analysts tend to over-estimate the cost of carbon reductions by underestimating the economic benefits of energy efficiency. For example, energy efficiency not only reduces energy bills, but also often leads to cuts in other costs to homes, buildings and factories. Maintenance, water use, chemical use all tend to decline.

“Changing our investment mix away from traditional, energy intensive patterns toward one that emphasizes more productive technology and behavior, greater energy efficiency, and more labor intensive activities can yield higher rates of economic growth and lower economic and environmental costs,” says the report. “In many ways this is much like rebalancing of a retirement portfolio to take advantage of changing market conditions and new growth opportunities.”

We managed to accomplish a high level of efficiency over the last 40 years with no particular plan. In fact, we proceeded in a “haphazard” and sometimes “counterproductive” way, says the report. What kind of energy productivity could we achieve if we actually tried? Might our energy secretary 40 years from now be talking not about what the new energy economy cost, but what it saved American households?

The report is available at: http://www.aceee.org/.

Visit Elisa Wood at www.realenergywriters.com and pick up her free Energy Efficiency Markets podcast and newsletter