smart grid€¦ · technology to save energy, reduce cost, and increase reliability and...

InfoNetrix NEW ORLEANS, LOUISIANA USA

39th Annual Public Utility Research Center Conference 39th Annual Public Utility Research Center Conference

PRESENTED BY

MICHAEL A. MARULLO, President/CEO Director of Research & Consulting

InfoNetrix LLC New Orleans, Louisiana USA

SMART GRID and what it isn’t! what it is…



My ‘Hat’ Rack

InfoNetrix LLC President/CEO Co-founder (January 2002) Director of Research & Consulting (2002 – Present)

Electric Energy T&D Magazine Editor-in-Chief (2009 – Present) Contributing Editor (2004-2009) Managing Editor & co-creator of Utility Automation* (1995)

Smart Grid RoadShow Conference Co-creator & Chairman (2009 – Present) 9th Event in St. Petersburg, FL (April 23-25, 2012)

cfar International Limited Founder & Managing Director (Since 1984) D/B/A automationInsights.com (2010)

*Now PowerGrid International; (PennWell Publishing Co.)

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The Shape of Things to Come…

"There are changes, lyin' ahead in every road;

And there are new thoughts, ready and waiting to explode; When tomorrow is today, the bells may toll for some…

But nothing can change the shape of things to come!”

(From the hit song: “Nothing can change the shape of things to come” by Max Frost & the Troopers, 1968)

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Today’s Lessons…

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What is the Smart Grid?

The term “Smart Grid” refers to a modernization of the electricity delivery system so it monitors, protects and automatically optimizes the operation of its interconnected elements – from the central and distributed generator through the high-voltage network and distribution system, to industrial users and building automation systems, to energy storage installations and to end-use consumers and their thermostats, electric vehicles, appliances and other household devices.

SOURCE: EPRI Report to NIST on the Smart Grid Interoperability Standards Roadmap (June 17, 2009)

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Another Smart Grid Definition

The Smart Grid is defined by the US Department of Energy as… “The system that delivers electricity from

suppliers to consumers using digital technology to save energy, reduce cost,

and increase reliability and transparency.”

SOURCE: What the Smart Grid Means to America’s Future; USDOE; 2009

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Defining Characteristics

The Smart Grid will be characterized by a 2-way flow of electricity AND a 2-way flow of information to create an automated, widely distributed energy delivery network.

It incorporates into the grid the benefits of distributed computing and communications to deliver real-time information and enable the near-instantaneous balance of supply and demand at the device level.

SOURCE: EPRI Report to NIST on the Smart Grid Interoperability Standards Roadmap (June 17, 2009)

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Traditional Grid Dynamics

(Bulk) Electric Power Flow

Data Communications Flow

For most of the past century, electricity has flowed primarily

from centralized generation plants over long-distance

transmission and distribution power lines to residential, commercial and industrial

customer premises...

…and data has typically been gathered from field

locations (extensively meter-centric) to a centralized host over various types of wide-

area communications infrastructure and media at relatively slow data rates.

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Smart Grid Dynamics

In the modern Smart Grid environment, both Electric Power Flows and Data

Communications Flows are increasingly bi-directional

Traditional Power Flow

Traditional Data Communications

Distributed Resources Power Flows

Operational Data Signals & Controls

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Grid Transformation!

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Before Smart Grid: One-way Power Flow; Simple Interactions

SOURCE: EPRI Presentation at NIST Standards Workshop (April 28, 2008)

After Smart Grid: Two-way Power Flow; Multi-stakeholder Interactions



SOURCE: Distributed Energy Financial Group LLC (April 2010)

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Understanding Smart Grid Benefits



Utility Automation/IT Sectors

Smart Grid Utility Automation/IT Sectors… Real-time Projects Asset & Geospatial Projects Field Automation Projects Substation & Field Devices (IEDs) Customer Services Projects Sustainability & Compliance Projects

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Market Drivers, Issues & Trends

Principal market drivers for Smart Grid projects can be grouped into 12 general categories…

(The following slides depict the most prevalent project drivers, as rated by a cross section of 25 leading suppliers to the Smart Grid marketplace. Respondents were asked to rate the relative importance of each factor as a Smart Grid Project Driver, first for the 2009-2010 period and then again for the 2010-2014 period.)

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1. Energy Optimization

2. Regulatory Mandates

3. Security Concerns (Data)

4. Security Concerns (Facility)

5. Customer Service Improvements

6. Performance/Reliability Improvements

7. Health, Safety & Environmental Issues

8. Labor/Staff Utilization/Improvement

9. Overall Return-on-Investment

10. Maintenance Cost Reduction

11. Operational Cost Reduction

12. Capital Cost Reduction



Project Justification Factors Retrospective: 2009-2010

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Relative Level of Importance



Project Justification Factors Future Outlook: 2010-2014

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Relative Level of Importance



Market Drivers, Issues & Trends Primary Factors & Considerations

Business & Technological Factors Business Analytics & Business Intelligence Cyber Security Standards Communications Constraints

Social, Political & Economic Factors Aging Workforce ARRA Funding (“Stimulus Bill”) Consumer Outreach & Empowerment

Health, Safety & Environmental Factors Declining Infrastructure Energy Conservation & Efficiency Sustainable Energy Resources

Regulatory & Legislative Factors Security Assessment & Mitigation Reliability & Situational Awareness

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Other Considerations

Several other factors could substantially alter market performance – among them: Global Economic Trends Future Oil, Gas & Coal Prices Presidential Election in 2012 Carbon Legislation

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Key Investment Perspectives

The two primary dimensions of Smart Grid and Grid Transformation are: Transitioning the power grid itself from 1-way

power to 2-way power Transitioning automation of the grid from 1-way

communications to 2-way communications A wide range of opportunities for exploiting each

of these dimensions is unfolding as technology advances and users adapt to (and adopt) new and creative ways of automating the grid.

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Key Investment Perspectives (Cont’d.)

Transitioning the power grid from 1-way power to 2-way POWER will involve… Expanded distributed conventional

generation Natural Gas (Utility & Merchant Plants) Coal (i.e., using “Clean Coal” Technologies)

Wind, Solar & Other (Renewables Integration)

Energy Storage Technologies Fuel Cells, Storage Cells (Batteries, Ultra-

capacitors, etc.) Unconventional storage devices (e.g.,

“Nuclear Batteries”) Increased Load Management & Dispatch

Functionality

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Key Investment Perspectives (Cont’d.)

Transitioning the power grid from 1-way to 2-way COMMUNICATIONS will drive… Large-scale investments in backbone communications

infrastructure Continued trend toward wireless solutions Ongoing investments in fiber to – and within – the

substation Increasing communications diversity (i.e., no longer a

“one size fits all” approach, especially for non-mission-critical applications)

Continued displacement of serial (traditional leased line) communications by Web-based IP (Ethernet) networks

Transition to IPv6, a new IP protocol mandated by the federal government for compliance across all organizations, It is designed to replace IPv4, the Internet protocol currently deployed and used most extensively throughout the world.

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Grid Transformation Situation (2009-2010)

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Total Market Values (in $000s) for Key Smart Grid Market Sectors in 2009 & 2010

NOTE: Substantial additional market values for MGF maintenance contracts are also projected.



Grid Transformation Outlook (2009-2010)

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Total Market Values (in $000s) for Key Smart Grid Market Sectors in 2014

NOTE: Substantial additional market values for MGF maintenance contracts are also projected.



Suppliers & Competition Competitive Dynamics

The Automation/IT supplier environment is fundamentally changing

Expect more, more, more, more, more… More M&A More rationalization (traditional suppliers)

More diversity (new & emerging suppliers)

More investment (VC, etc.)

More supplier consolidation

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Market Leadership

Market Leadership is about more than ‘size’ or ‘sales’… …it’s about Commitment, Continuity & Contribution: Commitment: Participates in the market regularly and

consistently with viable, established offerings – not just opportunistically

Continuity: Routinely participates in the market over many years and without interruption

Contribution: Exhibits creativity and innovation and delivers solid technical and financial performance in target markets on a clear and consistent basis and contributes time, money and resources in the broadest sense of market posture, presence and position

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And in the Future… Electric Vehicles…

Will not become prevalent until standards for everything from plugs and cables to batteries and charging stations conform to a broad set of yet-to-be-determined -- and universally accepted and adopted -- STANDARDS.

Ubiquitous Sensor Networks (USNs)… Will be deployed all across the market landscape, dramatically enhancing levels of situational awareness never before deemed possible – or economical.

Field Data Devices (RTUs, PLCs, Radios, Relays, etc.)… Will move away from application-specific devices to become generic intelligent devices that can be easily configured, calibrated, and customized via an online application store. Or, expressed in a more contemporary vernacular:

“There’s an app for that!” :-)

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And Remember…

SMART GRID ≠ SMART METERING!

SMART METERING ≠ SMART GRID !

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Contact Info

Questions About This Presentation?

Michael A. Marullo, President/CEO Director of Research & Consulting

Toll Free Line: +1 866 806 6549*

Email: [email protected]

*Outside US & Canada Dial: +1 504 466 2220

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PRESENTED BY

MICHAEL A. MARULLO, President/CEO Director of Research & Consulting

InfoNetrix LLC New Orleans, Louisiana USA

and what it isn’t! what it is…

SMART GRID

Thank You!

smart grid€¦ · technology to save energy, reduce cost, and increase reliability and...

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