NETL Overview

West Virginia Smart Grid Implementation PlanSteve Bossart, Dirk Baker, and Steve PullinsOctober 2009

# This material is based upon work supported by the Department of Energy under Award Number DE-AC26-04NT41817

This presentation was prepared as an account of work sponsored by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof.#Todays DiscussionWhat is the 21st Century telling us?West Virginia Smart Grid Implementation PlanResults for West VirginiaKey Lessons for the State and the Nation

3#3What is the 21st Century Telling Us?#4From the 20th to the 21st Century500 wind parks50 solar parks5,000 distributed wind5,000 utility solar2 M architectural wind5 M building solar25 M residential solar1 M PHEV/PEV10 M PHEV/PEV50 M PHEV/PEV100,000 Buildings as PP5#Use in slide show:

Point of slide is: Point out that the consumers involvement today is very small (i.e. the 1% figure) and how it will grow substantially with the Smart Grid

First view shows the current state of the grid (todays), the percentages are the asset utilization factors, akin to the occupancy rate for a hotel, low utilization rates are not efficient; the units/miles are the number of assets in each category, for Consumer Systems the 12.3M DG are backup generators, primarily located at commercial/industrial customersRemaining views show how new resources might be added to a Smart Grid (by sector G, T, D and consumers)5Result Sea Change in the NetworkConsumer engagement with resources to solve power issues locallyTwo-way power flow in DistributionAs prices increase, local renewables will increase in residential, commercial, and industrialImperative to transform from passive to active control in DistributionNew ways for Distribution to become a Transmission resource#6Smart Grid CharacteristicsThe Smart Grid is transactive and will:Enable active participation by consumersAccommodate all generation and storage optionsEnable new products, services and marketsProvide power quality for the digital economyOptimize asset utilization and operate efficientlyAnticipate & respond to system disturbances (self-heal)Operate resiliently against attack and natural disaster

Updated 02/25/2008the enabler#How does each support the new Smart Grid (decentralized, 2-way power and info flow)West Virginia Smart Grid Implementation Plan (WV SGIP)If you come to a fork in the road, take it.- Yogi Berra#8West Virginia Smart Grid Implementation PlanAddress the role of coal in Smart GridSupport economic development in State of West VirginiaOnly state-wide Smart Grid implementation plan completedEstablishes West Virginia and NETL as leader in Smart GridOnly second Smart Grid study to be published in the nation$540K project jointly funded through Attachment H process by NETL, RDS, Allegheny Power, AEP, State of West Virginia, WVU, and DOE OEResults describe the approach and value proposition of implementing Smart Grid in West VirginiaCost & benefit analysis compare the state of current electricity grid and future Smart Grid in West Virginia

#9RDS ($200K); NETL ($100K); State of West Virginias Division of Energy ($75K); AEP ($50K); Allegheny Power ($50K); WVU ($25K); OE ($40K).Led by NETL Modern Grid Strategy team members working with WVU, Allegheny Power, and AEP with involvement of Federal staff from PMC (Bossart) and OSAP (Hanley, DiPietro).Results will describe approaches to implement Smart Grid in West Virginia from the current state of its electricity grid and the cost and benefits of implementing Smart Grid from utility, consumer, and societal perspectives.The balance of electric power generated from coal and from renewable and other resources will be considered in the study relative to cost, environmental impact, reliability, energy security/independency, economic development, and other factors. This study is the only state-wide implementation plan for Smart Grid and will be only the second Smart Grid study to be published. The other published study is a Smart Grid study for the San Diego region. This study will assist in establishing West Virginia and NETL as a leader in Smart Grid as it begins to initiate implementation of Smart Grid in the state; the study will assist State utility commissioners in determining appropriate treatment of Smart Grid investments and benefits.

WV SGIP ProcessUpdated 02/25/2008

#Key Facts About West Virginia991,000 electric customers (142,000 commercial/industrial)16,500 MW of generation (90% coal-fired)Over 47,000 miles of distribution circuits5,900 miles of transmission lines58M MWh traded outside the state32M MWh used inside the state

AEP and Allegheny Energy serve 98% of the customersSAIDI (with storms) = 439 min/customer/yrSAIFI = 1.52Storm SAIFI = 0.45NOx = 157K T/yrSOx = 456K T/yrCO2 = 87M T/yrUpdated 02/25/2008#

Principal CharacteristicsSmart Grid Maturity Matrix EvaluationUpdated 02/25/2008Current StateFuture StateWV Smart Grid As-Is Principal Characteristics Aggregate Score#Final Results#13West Virginia Smart Grid SolutionsSolutionScopeAdvanced Meter Infrastructure (AMI)All residential, commercial and industrial Customers represented by 998,317 meters IT Integration (IT)A CIS Upgrade to accommodate AMI and DR functionality & Outage Management Demand Response (DR)The aggregated sum of 104 MW of DR from Residential, Commercial and Industrial CustomersDistribution Management System (DMS)The automated fault clearing & restoration of service, circuit monitoring and control of the Distribution System to include 707 circuits of 1107 total circuitsDistributed Energy Resources (DER)100MW of Base Generation, 800 MW of Peak Generation, 250 MW of Advanced Storage and 100 MW of Wind Resources all capable of being dispatched on demand #14Important Distinctions for WVReductions in WV consumption go to exporting more energy104MW of DR, doesnt necessarily mean a reduction of generation. It likely means 104MW of increased export.More efficient delivery system (reduced line losses) means more export.Benefits from reduced WV outages is higher than most statesHigher outage parameters (number and duration) are the overriding benefit potential of a WV Smart GridUpdated 02/25/2008#WV Smart Grid Costs & BenefitsPV 20-yr Cost and Benefits ($M) SolutionCostBenefitsAMI$399$1,649IT$170$1,308DR$22$1,091DMS$454$3,288DER$832$5,289Total$1,878$12,625#16WV Benefits by BeneficiaryPV 20-yr Benefits by Beneficiaries ($M)SolutionConsumerOperationalWV SocietyUS SocietyAMI$630$439$308$271IT$563$136$326$283DR$23$614$240$214DMS$2,909$73$303$2DER$3,368$2$301$1,618Total$7,493$1,263$1,479$2,389#17WV Annual Benefits ($M)Key Success FactorsBenefitsAnnual Benefits ($M)(All Beneficiaries)ReliabilityReduced Consumer Losses$898Reduce Power Quality Events$131EconomicReduce Price of Electricity$399Job Creation$215Consumer Sales of DER Resources$175Increased Energy Sales as Exports$7Reduced Transmission Congestion$1Increased Transportation Fuels Business$5Consumer Conservation$20Operational Savings$194EnvironmentalReduced Emissions$7SecurityReduced Blackout Probability & Dependence on Foreign Oil$13SafetyReduce Hazard Exposure$1#18Total Benefits & Cost Racking

#19Racking Costs & Benefits by Solution

#20Implementation PlanUpdated 02/25/2008

#Comparing Business As Usual to the Smart Grid Plan

#22Key Lessons for West Virginia and the Nation#23ConclusionsImplementing a Smart Grid will: Radically improve system reliabilityLower the carbon footprintSupport a better sustainable business climateGenerate benefits beyond the bordersWV numbers (20-yr present value)~ 1 million metersTotal Smart Grid Cost - ~ $1.9BTotal Smart Grid Benefit - ~ $10BBenefit Cost Ratio: 5:1A Smart Grid can be implemented with a portion of the business as usual (BAU) 10-year capital plan.A WV Smart Grid benefits the regional market (others outside the state benefit greatly)#$1,900,000,000 cost across 991,000 customers over 20 years = $96/yr cost per customer; benefit is ~$500/yr per customerPayback period is ~9 yrs24

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