Jack Eisenhauer

Last week, utilities from across the nation gathered in Charlotte, NC, to answer a fundamental question: Did the 5-year, $9 billion cost-shared investment in 132 smart grid projects make a discernible difference in modernizing the electric grid and improving reliability? That was the scale of smart grid technology deployments made by the U.S. Department of Energy and participating utilities under the 2009 Recovery Act. And despite some continuing challenges and uncertainties, the overwhelming evidence points to a resounding YES.

The Smart Grid Experience:  Applying Results, Reaching Beyond, a conference sponsored by DOE and the Electric Power Research Institute, examined successes, challenges, lessons learned, and next steps for smart grid efforts. Utilities discussed their experiences in integrating distributed energy resources, volt/VAR optimization and conservation voltage reduction, distribution automation and distribution management systems, communications and cyber security, AMI and smart meters, and consumer engagement.

Utilities big and small presented ample evidence of successes, such as quicker power restoration after storms, cost savings from reduced truck rolls, and voltage reduction in the 2%–4% range. They also revealed challenges—some expected and some surprises—that caused them to change direction mid-project. But most of all, each utility gained valuable data, insights, and experience that are motivating them to launch new smart grid projects that target additional benefits.

Here’s a sampling of my takeaways from the DOE-EPRI meeting:

Utility Insights on Smart Grid Implementation

  • Communications infrastructure and integration is by far the biggest challenge most utilities face.
  • Integrated, cross-functional teams and senior management buy-in are key to project success.
  • Customer acceptance of smart grid programs was better than expected.
  • Accurate measurement and valuation of smart grid impacts is needed to make a strong business case.
  • External factors—such as regulatory policy, technology cycles, economic conditions, and vendor performance—affect project success.
  • Internal factors—such as IT/OT coordination, legacy systems and system constraints, and workforce alignment—must be carefully considered.

Overheard at the DOE-EPRI Meeting

  • “DOE funding was a game changer.”
  • “Making cybersecurity plans a requirement [for DOE grant recipients] was a stroke of genius.”
  • “Automated systems require ‘Day 2’ support: there is no ‘set it and forget it.’”
  • “The age of the firewall is over.”
  • “Culture eats strategy for breakfast.”
  • “Communications is at the root of all the complex issues.”
  • “The substation as a data center is a wonderful model.”

Future Smart Grid Directions

Utilities are continuing to find beneficial opportunities to modernize, automate, and optimize power operations using smart grid technologies in their systems. Yet no single solution fits all utilities; project success depends largely on system configuration, location, and the maturity of smart grid programs. However, a fully modern electric grid will require massive investments and a unifying architecture that redefines the role of grid operators, brings regulatory clarity to foster a stable investment environment, and creates a business model that encourages innovation to serve customer needs and increase grid reliability and resilience. That will take time. But the technical and economic stimulus provided by DOE’s smart grid investments has already helped to accelerate the timetable and demonstrate the benefits of smart grid applications.