US Infra speaks to Andres Carvallo about how Austin Energy’s aggressive pursuit of new smart grid technologies has put it at the forefront of the utility revolution.
“Consumers can see the data on their energy consumption the day after, or even on an hourly basis, rather than simply when they receive their monthly bill”
Modernizing the country's electrical grid has become an urgent national priority. Population growth and increased energy demand, growing concerns over energy security, an aging transmission infrastructure and the need to integrate new sources of renewable energy into the already overburdened national grid are all problems that demand an innovative new solution. Implementing new smart grid technologies will help to revolutionize the production, transmission, and consumption of energy in the United States, and increase the reliability, efficiency, and security of the country's electrical system.
Whilst many utilities around the country have announced plans to deploy smart grid technology and are working towards this aim, Austin Energy has had its very own fully operational smart grid deployed since October 2009. The landmark project comprises the seamless integration of the electric grid; a communications network; and the hardware and software needed to monitor, control and manage the creation, delivery and energy consumption of all Austin Energy's customers. It took five years to deploy the full solution set at a cost of approximately $150 million.
As its competitors try to play catch up, the Texan energy giant is already forging ahead with a newer more aggressive phase of its smart grid plan. Named after its namesake Web 2.0, which is commonly associated with web applications that facilitate interactive information sharing, interoperability, user-centered design, and collaboration on the Internet, development of Smart Grid 2.0 is already in full swing.
For Carvallo, there is no doubt in his mind why Austin Energy is so far ahead of the pack. "We started in 2003 before anybody knew what it was. I would say that our closest competitors would be Encore and Centerpoint in Texas, and they're supposed to be finished sometime in 2012, 2014, and then in California the closest companies will be PG, Southern Cal Edison in San Diego, Gas and Electric, and I think their timeframe is pretty similar, 2012, 2014. So you could argue that we are 2-3 years ahead to 5 years ahead."
Back in 2003 when Austin Energy embarked on their smart grid development project, they started by deploying smart meters to one third of their service territory. This led on to a replacement and transformation of the infrastructure behind the utility and as Carvallo puts it, one thing led to another.
"We found ourselves basically working on intelligence on the grid at all levels. The company had a vision back then that the creative utility needed to go beyond the utility itself. Our vision of the Smart Grid has always been farther ahead than most in terms of the fact that it encompasses not just the utility infrastructure itself, but the buildings and the transportation sector," explains Carvallo.
"Aggressive" is how Carvallo describes Austin Energy's approach to their smart grid activities and he believes that what they are trying to do is much broader than the idea that most people have of what an intelligent grid is. "The Smart Grid is a combination of electric network, communications network plus a lot of hardware and software configured and deployed in a way that allows you uniquely to monitor, control and manage how you create, distribute, and consume energy," he says.
Traditionally the grid has been intelligent from the central power plant to the substation he says, but the grid has been blind from the substation to the premise. The main focus is now about putting the intelligence from the substation to the premise, which essentially means putting sensors and actuators in the distribution structure, around transformers, feeders, switches, capacitors, relays of all kinds and then installing a smart meter at the site of the premise. Inside the premise there will be smart appliances and distributed generation.
"So the grid needs to become self-healing," he says. "Meaning no human interaction, lots of rules engine and correlation engines deployed on a hierarchical nested network infrastructure." Due to the increase in the magnitude of data and the amount of devices that the smart grid will necessitate it is no longer possible for a human to manage the grid.
"When we move towards smart grid we're adding half a million devices on top of the 5000 elements already in the grid. In order to manage half a million devices it is just not possible for a human being to sit in a control and look at a screen and alarms coming for 500,000 devices non-stop and be able to discern and make choices."
But this self-healing smart grid of the future will offer many advantages to utility customers. Like Web 2.0, the smart grid will be far more interactive and user-centered and will allow a two-way communication between the utility and the consumer. "For the first time it would be a platform that allows for the sharing of the information with the consumer at different timeframes," he says.
This means that the consumer can see the data on their energy consumption the day after, or even on an hourly basis, rather than simply when they receive their monthly bill. Smart grid will also provide the consumer with a variety of ways to access their data such as having the information pushed toward a messaging system on their iPhone or their Blackberry, or an in-home display of some sort either through the web or some hardware device. This should give the consumer a better understanding of how they are consuming energy and also how their infrastructure may be causing a waste of energy.
Carvallo explains how the smart grid should also foster stronger relationships between the utilities and both the consumers and their business customers, particularly in the realms of conservation and energy efficiency. Many schemes are already offering rebates enabling consumers and companies to upgrade their equipment, such as air conditioning units or pool pumps, in favour of more energy efficient alternatives. In the past, he says, there were no real ways to gage if such an investment has achieved the expected gains, but with smart grid and intelligent metering there is now a baseline of what occurs in your property which enables what Carvallo calls "a true verification of your investment".
However, the smart grid will; also provide benefits for the utilities themselves particularly in terms of operational efficiency, which should in turn translate to increased customer satisfaction. "Instead of waiting for customers to call us and tell us their power is out, we know the moment it is out. Even if customers are out, we can send an SMS message to their smart phone alerting them to outages and also letting them know once it had been fixed so it never actually has to impact them," he says.
"So the technology is going to move from being very reactive to being very proactive and it would change the whole customer experience. It would really make customers far more trusting of the utility and far more relaxed about the service they get from the utility. That in itself will be a huge benefit."
Another advantage for the utility is the fact that smart grid will allow a streamlining of operations because of its ability to be more prescriptive and precise about any system failures. As the utility will know immediately what is wrong, they will also know how to fix it and what equipment is required to do the job and who they should send to make the necessary repairs. "So the utility will be more efficient and more effective in how it uses resources and how it manages inventory and how it does maintenance of its equipment," explains Carvallo.
The benefits for both businesses and consumers are clear but smart grid also plays an important role in helping to meet our renewable energy targets. "The Smart Grid is an enabler. Without it there's no way that you can reach any significant energy efficiency and any significant penetration of renewable energy," says Carvallo.
"The smart grid is a conduit to enabling and accelerating more energy efficiency and accelerating renewable energy at the central power plant level, but also more importantly at the distribution level, meaning distributed generation, solar rooftops and micro wind turbines in homes. You need the smart grid for all that to come together."
Smart grid, it would appear, will revolutionize not only the way we consume energy but also the way that utilities interact with their customers. The industry is making good progress and in the next few years we should expect to see smart grid technology being deployed throughout the country. And if Austin Energy's vision of the smart grid of the future is fully realised we will see the impacts not only affecting our homes and our businesses by also our means of transport. And if the other utilities are to keep up, Carvallo suggests that they may need to look beyond the parameters of smart grid 1.0.
"The thing that is really going to drive the point home about the need for this market will be the proliferation of electric vehicles and solar rooftops," he says. "As electric vehicles become a reality - and they seem to be coming at us fast and furious - the electric utilities across the globe are going to have to make an investment in smart grid technology, because if these vehicles show up in their service territory and they don't have the intelligence to deal with it, they will have some serious reliability problems."
In December 2008, Austin Energy embarked on an initiative called the Pecan Street Project. In anticipation of completing its smart grid 1.0 in 2009, Austin Energy reached out to the city of Austin, the University of Texas, the Chamber of Commerce, and teamed up to create Austin's next generation smart grid implementation.
Other companies also partnered Austin Energy in this ambitious project to explore smart grid 2.0, including Applied Materials, Cisco, Dell, Freescale Semiconductor, GE, GridPoint, IBM, Intel, Microsoft, Oracle, the SEMATECH consortium and the Environmental Defense Fund.
Austin Energy's goal in creating the Pecan Street Project is to transform into the urban power system of the future while making the City of Austin and its local partners a model clean energy laboratory and hub for the world's emerging clean tech sector. In doing so, Austin Energy is seeking to prove that it is possible to transform the way we traditionally produce, use, store and trade energy.
For the project, Austin Energy has targeted a specific neighborhood, some 300 acres in the east side of town where 1000 homes and 75 businesses will be built. The area will be turned into a state of the art Smart Grid 2.0 where every property will have solar rooftop, energy storage, smart appliances, and electric vehicles all connected on to the Smart Grid.
The project has a timeframe of five years and will be used to explore a lot of things that haven't yet been achieved or tested with smart grid 1.0; real time pricing, time of use pricing, demand response programs and energy rebates. As the results of these different pilots and programs come to bear success, they will then be translated into the rest of the service territory. Basically if a project is successful then it could be rolled out within 90 days to six months of finishing the pilot.