Just as smartphones revolutionized the telecommunications sector, smart grid technologies are poised to make the same impact throughout the energy ecosystem. Factors driving the development and adoption of smart grid solutions include increased demand for integration of renewable energy sources, and government policies and mandates for sustainable energy.
Smart grid technologies are also making waves in the financial sector attracting market-moving investors such as Warren Buffet. The smart grid market is expected to grow from USD 20.83 Billion in 2017 to USD 50.65 Billion by 2022 (a Compound Annual Growth Rate of 19.4%) according to “The Smart Grid Market – Global Forecast to 2022” report released by ResearchandMarkets in July.
1. John, when you are at a social or family event, and asked ‘what is a smart grid?’ how do you answer?
My answer to that question depends on the audience’s technical background and experience. For a social or family event, I would begin by saying that at GE we say Smart Grid spans from “turbine to toaster.” In other words, this extensive landscape includes generation, transmission, distribution and the end-use customer. With Smart Grid, we are implementing intelligence on this extensive landscape to make the grid more efficient, more reliable, and more eco-friendly.
2. What is the most difficult stage of transitioning from the traditional grid to the Smart Grid?
The most difficult stage is getting the most value from legacy equipment when new equipment is added, and both old and new equipment co-exist. This is commonly seen in substations, where a utility adds new equipment to an existing substation – when this occurs the main goal, and challenge, is maximizing functionality of the old or legacy equipment.
3. What are some of the game-changing smart grid innovations that are likely to come to play in the next 5-10 years?
Internet of Things (IoT) advances are transforming the energy sector, and we expect to see greater increase in data generated from the “edge of the grid” that will drive new solutions and opportunities.
When we talk about “edge of the grid” this refers to the proximity to end-use customers – their homes, businesses, or distribution systems – rather than power plants or transmission lines. “Grid edge” hardware includes solar panels, advanced metering infrastructure, smart inverters, energy storage systems, smart thermostats, smart appliances and building controls. Software examples include automated price-responsive demand response, real-time grid optimization to enhance reliability, availability, efficiency and cost, and data analytics.
As “grid edge” hardware and software becomes more widely adopted, they create new business opportunities in areas such as consumer analytics, third-party ownership and control – like rooftop solar companies, and aggregation for wholesale market participation – this will enable, for example, local communities to unite to buy energy at wholesale prices. We are also defining use cases for applications in the energy industry for blockchain and smart contracts.
This history of smart grid video highlights the development and projected future impact
4. According to a recent press story, 50 emerging nations are projected to invest $26bn in smart grid infrastructure over the next decade – what will be the main priorities for these countries?
The first consideration is building a strong grid – this requires investment in communications and IT/OT infrastructure. IT is the Information Technology infrastructure and OT is the Operations Technology infrastructure. Once the foundation has been laid, there needs to be increased implementation of sensors to provide greater observability of the grid, and then analytics to process the data to provide value. And to fully-analyze, and maximize the data generated, intelligent digital substations should be installed as well.
It’s also important to invest in five critical technology components – GIS (Geographic Information Systems), OMS (Outage Management Systems), ADMS (Advanced Distribution Management Systems), smart meters, and AMI (Advanced Metering Infrastructure) communications.
5. From an end-user perspective – consumer or business – how will new grid innovations change the way they consume and purchase energy?
New grid innovations will enable greater use of in-home enabling technology such as programmable communicating thermostats, and other home appliance energy saving apps and solutions. Based on smart meter information, customers can also make more informed decisions, and plans, regarding their power usage and how, and where, they can make savings. They can also take advantage of time-of-use rates to schedule power use at partial and off-peak hours.
In this new environment, utilities must be more pro-active in providing services and information to customers – smart grid innovations facilitate two-way interactions and customers expect more as the technology improves.
6. From an ASEAN perspective, could emerging nations such as Cambodia, Laos, and Myanmar make the leap from 1970-80s infrastructure straight to the latest tech available today, or coming onstream soon?
Yes, it is possible and probably easier to do as there is less legacy equipment to incorporate with the new equipment. In terms of challenges however, having a skilled workforce to support research, installation, monitoring, and maintenance is the biggest obstacle to grid modernization.
7. What about an ultra-modern nation like Singapore – what types of solutions are they interested in, in the near term?
Based on feedback I received when I was teaching a GE Smart Grid course in Singapore, one of their key issues was how best to address cybersecurity concerns. There is also a drive to digitize the grid and optimize benefits from this. Consideration of backward compatibility – to enable interoperability with older legacy systems – for all new equipment purchases is another area of interest for Singapore.
8. What countries/regions are leading the way in terms of Smart Grid innovations and adoption today?
Leading nations include Singapore, Japan and Hong Kong – they have the best grid reliability. Hong Kong is interesting as it still utilizes older, home grown equipment.
9. Finally, what are the biggest challenges/threats to smart grid innovation?
An important issue is how to avoid obsolescence, or how to protect your investment in new technology – future proofing.
I believe change in culture within utilities is also needed to manage the pace of change, and threats such as physical and cybersecurity. Other areas for utilities and energy sector regulators to address include privacy of information, utilization of industry standards to facilitate integration and interoperability, and observability strategy – that is, determining how many sensors to install and where to locate them.
And with the rising popularity of renewable energy, we need to think about how can grid tech make renewables even more compelling – for example, grids with lots of storage capacity built in, and grids smart enough to help customers adapt demand to supply. One example is GE’s new hybrid energy storage/gas turbine combined solution. It includes 10 MW lithium energy storage integrated with a 50 MW gas turbine generator.
John shares more about Smart Grids in this recent interview video.