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Faster, Stronger, Smarter: The Smart Grid's Informational Efficiency

By: Dania Nasser

September 19, 2011

Lately, the calendar has been marked by noteworthy weather events. Subway-stopping snow, roof-raising tornadoes, and Saharan style haboobs are commonplace on the evening news. Technology now facilitates almost anyone reporting odd conditions — resulting in accounts at a greater speed and higher frequency than ever before (see FourSquare's Heatpocalypse [1] ). In this Information Age there is an undeniable value added in having information. The power of that value is the ability to predict, prepare, and ultimately perform better — and this is the goal of the smart grid. The smart grid seeks to usher the U.S. electricity system into the 21st century by creating a more efficient electricity transmission and delivery system — and possibly delivering the key to effectively managing energy as a whole.

The smart grid is an electrical transmission matrix designed to allow for real time, two-way communication between energy consumer and energy supplier, in which information and electricity are exchanged. This dialogue exchange, through the use of information, manages incoming load demands and helps to build and run an electrical delivery network that is increasingly reliable, secure and efficient. Smart grid development and deployment is particularly important because predicting exactly when peak demand will occur and generating just enough energy for delivery is something that the current electrical grid is not designed to do.

For example, on a very hot day in New York City, there is no telling precisely when every office, school and household will turn on the air-conditioning until power plants find they need to bring peaker plants (plants used to help meet peak demands) online; this inability to anticipate demand results in severe strains on the system and ultimately can cause electricity blackouts and equipment failures. With a smart grid, New York City's peak will be anticipated and the highly connected grid will be able to communicate to bring electricity to meet demand from other regions with lower demands at that time. In the U.S., smart grid is operating or in development in cities including Austin, Texas and Boulder, Colorado. Worldwide, leaders in smart grid development come from cities in Europe and Asia, particularly in Germany and South Korea.

Smart grid has many benefits, but some of the more notable advantages do not necessarily fall under signature environmental topics. The smart grid, through efficient use and delivery of energy, could eventually result in a direct cost savings for both the consumer and energy provider. The smart grid will also offer highly reliable delivery of energy. Implementation of a smart grid would bring a much needed and overdue update to U.S. infrastructure. The current electrical grid system was rolled out over one hundred years ago. It's a system that was built for 19th century technology and energy demands, providing for one-way interactions, which can do no more than try to deliver energy when demanded. The nation's electric grid, especially in regions where both population and general demand have increased, is in need of an upgrade. The smart grid offers a technologically feasible upgrade with systemic and economic advantages such as enhanced performance. The smart grid can be implemented on a very local scale, or given the willingness of several municipalities, cities or states, on a larger geographic scale. If the federal government chooses to be involved, participation from several organizations including the U.S. Department of Energy, the Federal Energy Regulatory Commission, the Environmental Protection Agency, the U.S. Department of Commerce and the U.S. Department of Defense can all be expected.

What's so smart about the smart grid? The information it can provide about current energy demand (peak times, number of customers, general customer usage and patterns) and system stresses (weather or time of day) will allow for a more effective response from the energy provider to consumers' energy demands. A smart grid system will also bring more connectivity to an energy system. By functionally bringing together numerous electrical grids, information as well as 'extra' energy can be shifted to regions where energy demand is peaking, thus reducing the cost for the consumer and reducing the burden to meet demand for energy producers. This ultimately allows for a better understanding of energy usage, demands, and the ability to shift energy throughout regions seamlessly. As a new technology, smart grid is also designed to integrate various electricity technologies, including clean technologies into the electrical delivery system. In fact, the deployment of clean energy technologies heavily relies on the implementation of smart grid, which is built to handle uneven output from various clean energy producers like wind farms and solar panels.

While smart grid has gained momentum in many cities worldwide, complexities may delay progress. The first complexity is how to encourage standardization of the smart grid. In order to make the smart grid as connective and fluid as possible, standards, or a set of regulated guidelines for the design of the various components of an electrical grid, such as the electric vehicle (EV) charging, digital information (language by which the grid communication will occur), meters, internet usage must be set in place. Recently, the Federal Energy Regulatory Commission (FERC) refused to adopt a set of smart grid guidelines for standards. FERC also opted against giving guidance as to future expectations or steps for developing a unified and communicative energy system. With no set guidance as to how to build and update electrical grids, the development of a protocol that will work on all electrical grids will be tentative if not entirely thwarted.

In addition to an uncertain regulatory future, concerns over consumer privacy pose another obstacle to effective smart grid implementation. The concern is this: while traditional energy programs only measure aggregate energy use for billing purposes, the smart grid measures consumer energy use along several dimensions (time of day, season, geographical region, household size) and then integrates that information into its algorithms for energy distribution. The consumer privacy concern, while surely important in the near term is addressable, for several reasons. First, the information being collected, while sensitive (or generally not publicly available), is not markedly more sensitive than the current information being collected. Additionally, smart grid data storage will actually be much more robust and secure than current crumbling systems. Finally, much of the privacy battle is being fought and won by industries that went web-based and smart long before energy. This concern, nonetheless, should be kept in mind for smart grid advocates in the near term just as general cyber-security issues facing banks, companies, and websites are raising concern.

With a robust roll-out as well as regulatory and investor support, the smart grid can bring a much overdue upgrade to vital U.S. energy infrastructure systems while integrating and utilizing electric usage information to create a system that is orders of magnitude more efficient than our 19th century legacy system. The smart grid represents the future of technologies that will allow optimal use of resources. Unlike many "green" initiatives the smart grid does not require picking "winner technologies" — it's a no-nonsense framework for doing things efficiently. It's smart.


[1] See Heatpocalypse NYC; Heatpocalypse Washington D.C.; Heatpocalypse San Francisco.



Dania Nasser is pursing a Masters in Environmental Management at Yale University. She is completing her associateship at IBM's intellectual property group and is currently Director of Environmental Affairs at a New York law firm specializing in environmental and construction law.

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