How to stay agile with your smart grid implementation

As we stare down the barrel of the biggest disruption to hit our industry in more than a century, one thing is clear: Utilities need to stay agile, ready to make the quick turns and accelerations that the Smart Grid – with its two-way digital technology -- demands. The cost of inflexibility in a time of rapid change can range from wasted dollars, to business demise.

“Best-of-breed using an integration platform also helps you maintain current investments in business applications and even meters that you've purchased for trials.”
-Gary Bloom, CEO and President, eMeter Corporation

That's why, as utilities make decisions on which new technologies, systems and processes will provide them with a solid launching pad into a successful future, it's extremely important that the selections they make enable them to grow at the same pace as the innovation that will be hitting the market. Indeed, technology platform selection is perhaps the most crucial factor as to whether a utility can navigate in a time of unprecedented innovation or be delayed and even stopped short by U-turns or, worse, dead-ends.

Meet Innovation with Innovation

There are two approaches today that promise to deliver Smart Grid benefits. One is the single-vendor approach, which offers the gamut of software, communications networks and devices from a single provider. The other is known as the "best-of-breed" approach, wherein you select the best technology for your budget and business needs and integrate it together. There are pros and cons to each, but the latter offers maximum flexibility.

Opting for the single-vendor approach has its appeal. It appears as the most simple choice in terms of procurement contracts. The meter data management software is designed to plug right into the vendor's meters, and both integrate into the vendor's network hardware and management system. It all seems plug-and-play, and in some cases, the vendor might offer some system components for free, as long as you buy accompanying hardware or software.

But it's important to understand that the single-vendor approach -- while seemingly the simplest and least risky route to the Smart Grid and all its promises -- is also fraught with peril. The downsides can be summarized this way:

• A single vendor is more apt to hit resource constraints, which can mean delays for you if it's slow to upgrade its system capabilities.
• The vendor's systems may not integrate well with your existing enterprise applications, such as billing, customer, outage and workforce systems.
• The risk of lock-in is high, as the vendor's systems may not integrate with innovations or less costly technology from other industry players.
• Your ability to grow and change is only as good as the vendor's.

Now let's take a look at the best-of-breed approach. Taking this route requires a little more research into technology selection, but when it comes to choices, you're in the driver's seat. As long as you select a platform that enables easy integration with your existing or future environment of meters, legacy applications, network hardware and network management systems, you can pick and choose from an array of available technologies. If a new innovation like a smart car charger is developed or a less expensive meter comes along, you can integrate that in.

Appearances can be Deceiving 

On the surface, systems from a single vendor look capable of snapping together readily. But most single-source vendors are able to offer an array of systems because they've acquired them through acquisition. Innovations and upgrades to these products may very likely be delayed.

Contrast that with the best-of-breed approach. When technologies are upgraded, the developers only need to make changes to the interface. Support is simplified, integration is taken care of, and upgrade paths pose no risk or complication. The architecture itself is no more complicated than a single vendor's.

Beware of Vendor Lock-In

Perhaps the biggest issue with the single-vendor approach is that of vendor lock-in. In five years' time or less, the industry will be operating with new pricing and energy delivery schemes and it will need to support new consumer products ranging from electric vehicles, to home-area networks.  No matter what the future holds, it's crucial for utility companies to stay ahead of the curve.

It's a big gamble to invest everything in a single vendor's vision that, a year or two out, you may not share. It wasn't long ago, for instance, that some customers made large investments in automated meter reading systems that - because they could not scale to the capabilities of the Smart Grid - needed to be replaced with updated technology.

Another example is the concept of energy democratization, in which consumers and businesses would be able to sell power back to the utility that they generate via distributed energy resources. In this case, meters would need to accurately record in both directions to issue and track credits and refunds, which not all meters do. If your vendor falls into that category, this leaves you in a bad spot, especially if you're well into a full implementation.

Lastly, what happens if you discover the chosen vendor's technology does not scale to the levels you expected it would? It would be an expensive proposition to start again with a new platform if the one you've chosen doesn't meet your needs. 

Long-Term Compatibility with Evolving Technology

With a best-of-breed approach, using an integration platform, it's always possible to make changes as you need to, to keep up with whatever new directions the Smart Grid takes. These directions may include:

• Identifying and incenting heavy power customers to reduce peak-hour usage, thus avoiding the cost of building a new power plant.
• Encouraging voluntary cutbacks by communicating with customers about their usage.
• Performing targeted brownouts to avoid shutting down crucial operations and appliances.
• Providing Web portals where customers can view power consumption over time and get early warnings of usage spikes.

Best-of-breed using an integration platform also helps you maintain current investments in business applications and even meters that you've purchased for trials. If you've got thousands of meters and several trials under way, you don't want to throw that investment away. With an integration platform, you can conduct your trials and connect the meters you select.

Quick Turns, not Dead Ends

In a few years, the utility industry will look quite different from how it looks today.

With all the opportunities -- and turmoil - that lies ahead, the most important decision you can make is the type of platform you select to manage all these new capabilities, as well as the ones that continue to develop.