Get Smart
In 1886, the town of great Barrington, Mass., set up the first alternating-current electrical transmission line in the U.S. In the nearly 125 years since, the products we run with electricity have changed incalculably, but in many ways, the massive grid that delivers that power has barely changed at all. Utilities have little means of tracking the electricity they produce and distribute; if a blackout occurs, they're in the dark until angry customers start calling.
Users are in the same boat. They don't know much about the electricity coming in, and they don't much care, since they generally pay about the same for their power throughout the day even though spikes in demand make electricity much more expensive to produce at peak times. The result is a creaky electrical grid that is still prone to spectacular failures like the 2003 blackout in the northeastern U.S. and parts of Canada. Yet smaller leaks are problematic too. "We lose between 7% and 9% of our power in the wires of our transmissions system," says Don Von Dollen, program manager at the Electric Power Research Institute. "That's a lot of power lost into the air." Our tech is 21st century, our grid barely in the 20th.
But there's a way to upgrade the grid by marrying the networked intelligence of the Internet to transmission lines and transformers. The result wouldn't just be better; it'd be smarter — a smart grid. Utilities would be able to remotely monitor the distribution of electricity, allowing them to respond rapidly to any outages. Consumers would be able to use intelligent, networked appliances to control how and when they use electricity, shrinking their power bills and smoothing demand.
A smarter grid could better integrate intermittent renewable sources like wind and solar, which would help cut carbon emissions and ultimately save consumers as much as $20 billion over the next decade. Though transforming the nation's electrical system will be a long and expensive process, the creation of a smart grid is one of the White House's top green priorities, with the Federal Government releasing $3.4 billion in grants in October to 100 companies working on the grid. "It will make our grid more secure and reliable," said President Barack Obama in an October speech. "Building this 21st century energy infrastructure will help us lay a foundation for lasting growth and prosperity."
We're still a long way from a truly smart national grid, but cities around the U.S. are beginning to put the pieces together. In ever green Boulder, Colo., the utility Xcel Energy has embarked on its SmartGridCity project, an experiment that would make the town the first fully functioning smart-grid-enabled municipality in the world. It begins with the installation of 16,000 advanced smart meters, which allow Xcel to track its customers' electricity use on a real-time basis. With the entire system networked, that data can be used to anticipate failures and allow Xcel to respond quickly; the project has already helped the utility avert four potential long-term outages this year. "We can see a failure before it's a failure," says Jay Herrmann, regional vice president of Xcel.
The company will soon launch an in-home energy-management Web system that will allow Boulderites to remotely review and control their electricity consumption. With that knowledge comes power: by tracking our consumption patterns, we can use electricity more efficiently. "Fundamentally we're applying information technology to the existing electrical infrastructure," says Mark Brownstein, managing director of business partnerships at the Environmental Defense Fund. "With greater information, we can provide new opportunities to improve service and reliability."
Among those opportunities will be the chance to improve electrical efficiency so much that utilities will be able to forgo adding new power plants. Right now, consumption usually peaks in the afternoons of hot summer days, when air conditioners are throbbing, and ebbs in the middle of the night. Utilities always need to ensure that they have enough reserve capacity to meet the moments of highest demand.
But if utilities were able to track electricity consumption in real time, they could price power according to consumption rates — higher during peak-demand times and lower during the ebb. Customers could then adjust their consumption. The result would be a flattened demand curve, reducing some of the need for utilities to build new, often polluting power plants. That same technology could better integrate wind and solar into the grid, because a smart-grid system could more easily compensate for the days when the wind isn't blowing or the sun isn't shining. "Peak demand is the big issue," says Dan Sheflin, chief technology officer for Honeywell Automation and Control. "That's really a key leg in the smart grid."
It would be too much to expect consumers to manually respond to changing pricing schemes — unless you want to become the DJ of your thermostat. Instead, consumers will rely on smart appliances that will be plug-and-play with the new grid. Power hogs like refrigerators, water heaters and air conditioners will be able to respond to price signals — automatically powering down during price peaks and cycling back up when electricity is cheaper. Control would still be in the consumer's hands: if you like your house arctic cold during the hottest days of the summer, you could program your air conditioner to run 24/7. But it would be push-button simple to select more-efficient consumption.
When electric cars come into wide use, the same principle will apply. Smart cars will draw power from the grid during times of low demand and maybe even transmit back to the grid during peak periods. "These products will be able to communicate directly to the utility," says Kevin Nolan, vice president for GE Consumer and Industrial, which expects to have smart appliances on the market as early as 2011. "They'll know when we can afford to use lots of electricity and when we need to curtail it."
For that to work, though, the smart grid will have to be about more than just technology. Smart policy has to be in place. Right now, utilities make their money by selling electricity, and for them, the more juice they sell, the better their bottom line. As long as that's the case, a smart grid may seem like a threat. Instead, utilities must be rewarded for essentially selling less electricity, as they already are in California — one reason that state is a leader in energy efficiency. And the smart grid will require a standardized system of protocols to enable utilities, meters and appliances to talk to one another. "It's a lot like the development of the Internet," says George Arnold, who runs the smart-grid program for the government's National Institute of Standards and Technology. "Those standards need to get firmed up."
Of course, an electrical grid that works like the Internet could have a downside. There are concerns that a smart grid could be a tempting target for hackers or even terrorists, though defenders point out that similar fears haven't stopped the growth of e-commerce. The potential benefits of building a more intelligent grid outweigh the risks and the up-front costs.
As the world works to find a way to deal with global warming at the U.N. climate summit in Copenhagen next month, it's important to remember that the cheapest way to cut carbon is not to emit it in the first place. "It's going to be a long journey, but the investment will be worth it," says Allan Schurr, vice president for strategy and development at IBM's energy and utility business. It is the smart decision.