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TRANSCRIPT
Transformers + smarTer design
Utility (+ beyond) ©©
insightsaarP
Cobb emC
delaware eleCTriC CooPeraTive
fayeTTeville’s PwC
Hydro one
naTional grid
PeCo energy
smUd
THe regeneraTion ProjeCT
Toll broTHers
vol 1, issUe 6 » nov/deC 2009 » www.inTelligenTUTiliTy.Com
nitty gritty of cyber ©©
security Oncor steps up the defense
when we’re ©©
65…or 22 SDG&E pairs smart tech + workforce
Pepco talks delaware ©©
deployment
An EnErgy CEntrAl PubliCAtion
Transform smart grid into reality. Start your FREE PROFESSIONAL SUBSCRIPTION at
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where smart grid meets business—and reality.
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When you are overwhelmed with multi-source data, including real-time sensor feeds that require correlation with other data for contextual understanding, overcoming obscurity of meaning is a daily challenge. This is especially the case when events require an informed decision and fast, confident action. Under time constraints, operators with long tenure may resort to intuiting necessary action – not an optimal option and clearly no option for short tenure workers easily blinded by the light of too much information.
Responsible performance and public accountability requires control room operators, as well as operations and executive personnel, to draw unified meaning from streaming sensor feeds, enterprise applications, databases, and weather and environmental feeds. Extraction of unified meaning requires correlation of multi-source data for geospatial display of high-context analytics that inform decision making.
Since elimination of multi-source data is out of the question, the focus should be on making it effortlessly accessible and intuitively rich in contextual meaning.
How?Space-Time Insight geospatial composite applications automatically correlate real-time streaming data with other enterprise content and web feeds to derive and geospatially display location and condition-based visual information on 3D satellite images for informed decision-making and fast action. Geo-links launch multiple processes for fast mitigation and remediation directly from the same screen. Further, automated incident reporting verifies regulatory compliance, while full-context on-screen
replay supports forensic analysis, audit, planning and problem solving.
Intuitive alerts notify operators of system disturbances while onscreen action scripts guide them through compliant mitigation and remediation of situations ranging from asset degradation to extreme weather impacts (high winds, ice, storms, floods), to other natural (fire, earthquake) and man-made system disturbances. Even load curtailment requests and demand response programs can be geospatially visualized, making complex smart grid management tasks intuitive.
The Result:Utilities benefit from improved overall performance and the ability to respond to, and even avert, potential system emergencies in the delivery of safe and reliable energy.
I Can See for MilesBy Mark L. Feldman, PhD
The 1967 song, “I Can See for Miles,” remains The Who’s biggest hit single in the USA. The song is about being able to perceive reality – even if it’s obscured.
Screenshot of Space-Time Insight’s Historical Replay feature showing Phase Measurement Units (PMUs) in the path of a hurricane
Mark L. Feldman, CEO, Space-Time Insight
Mark L. Feldman, PhD, [email protected], is responsible for Space-Time Insight’s strategic direction. Formerly, Mark was Senior Vice President of Strategy at Virsa Systems and Senior Vice President in the Product & Technology Group at SAP Labs. Mark is a frequently quoted speaker, who has addressed audiences throughout the world on industry transforming events.
www.spacetimeinsight.com
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�Features // Nov/Dec 2009
�Metering�blue�hens
16 Pepco discusses delaware metering deployment
�Nitty�gritty�of�cyber�security
26The offense
Learn what “hackers” are saying about smart grid
28The defense
See how Oncor keeps raising the bar on security
�When�we’re�65…or�22
38older + wiser
Learn how PECO + SMUD capture retiring worker knowledge
40more than in the door
See how utilities can attract + retain younger workers
41 new innovation
Understand how SDG&E pairs technology + workforce
Departments
4 drawing the line
6 Transmissions
6 Letters from readers
8 What is an intelligent utility?
10 The big picture
10 Smart skeptics
11 Grid first
12 Blue hen state
48grid(un)lock
48 Minding the store
49 Back to the future
50 Tangled network
58end of the line
58 Appliance influence
59 Renting out
62 Energy lifestyles
644d
64 Transformers
65 Smarter design
67 New grid, old grid
68Connections
68 Telephone game
70 Comm rings
72out the door
72 Green congregation
74 Complex design
Vol. 1, No. 6, 2009 by Energy Central. All rights reserved. Permission to reprint or quote excerpts granted by written request only. Intelligent Utility is published bimonthly by Energy Central, 2821 S. Parker Road, Suite 1105, Aurora, CO 80014. Subscriptions are available by request. POSTMASTER: Send address changes to Intelligent Utility, 2821 S. Parker Road, Suite 1105, Aurora, CO 80014. Customer service: 303.782.5510. For change of address include old address as well as new address with both ZIP codes. Allow four to six weeks for change of address to become effective. Please include current mailing label when writing about your subscription.
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Get the Net. Get FlexNet™ and get the power to measure, manage and control. FlexNet’sproven technology amps up your abilityto get more from the smart grid. Expectreal-time, two-way communications.Instant coverage. Direct point-to-pointconnections. Higher data rates. Andunmatched reliability. Which means youcan also expect more accurate billing,better management of resources andenhanced energy conservation. Plus,FlexNet helps you get current and staycurrent, with the flexibility and scalabilityto evolve and grow. With benefits likethat, it’s no wonder that FlexNet has thelargest active deployment of any AMIprovider in North America. So get smart.Get the Net, and get ready to becomethe utility of the future. Find out more at sensus.com/flexnet.
AND GETTHE LEADERIN AMI.
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wHaT Travel soUvenirs do yoU UsUally bring Home? a PosTCard? a snow globe? Perhaps a kangaroo paw backscratcher? Well, I have got you all topped. I collect interviews
(no, not with kangaroos, but with people). I do provide immediate feedback from smart grid/intelligent utility travels
in the form of Airport Reports (www.energyblogs.com/intelligentutility). However, there are many things I just can’t squeeze into those reports—like great interviews that I snag during my travels about what is happening in the utility industry. Then I realized that, unlike other souvenirs such as canned snow or blurry pictures of other people’s vacations, these interviews could be souvenirs that you might actually find valuable and enjoyable, too. So I crammed as many of them as possible into this issue. My favorites include:
spendinganearlyfalldayinterviewingsixkeypersonnelataPepco??
holdingsinc.(Phi)officeinthenewJerseycountryside.igainedinsightintoPhi’sBlueprintfortheFutureinitiative—particularlyitsadvancedmeteringinfrastructuredeploymentfordelaware.(page16)swingingbytheBigdtochatwithseveralfolksaboutoncor’ssmart??
gridefforts.inthisissue,welookathowoncorcontinuestomakegreatstridesinimprovingitssecurity,butrealizesthatitwillalwayshavetoworktostayonestepahead.(page28)afterhearingsomeonementiontheaarPandsmart??
gridinthesamesentenceind.c.,italkedwithaarPtolearnmoreaboutasmartergrid’simpactonolderpopulations.(page11)aftermeetingoneofitsmembersinnebraska,itookthe??
opportunitytolearnmoreabouttheregenerationProjectandhowitsinterfaithPowerandlightcampaignislookingattheenergypossibilitiesofmorethan380,000congregationbuildingsacrosstheUnitedstates.(page72)
And, with the announcements of the Smart Grid Investment Grant winners, we should see more rubber hitting the road on more smart initiatives. I look forward to many more road trips—and interesting souvenirs—to come.
Please enjoy the issue and send along your own thoughts, insights and stories from your own intelligent journeys.
Thanks for reading!
H. Christine Richards
Vice president, Intelligent Utility division Editor-in-chief, intelligentUtility magazine [email protected]
Utility souvenirs
Intelligent Utility is printed on 20 percent recycled paper using only soy-based inks.
enjoytheissue?then
subscribeforfreeat
www.intelligentutility.com/
subscribe
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sHaring load (seP/oCT)
I am glad a “small” utility is thinking “large” and comprehensively. This type of out-of-the-box and strategic thinking is exactly what is needed to truly imple-ment “smart” processes and transform the utility industry. It will take some risk on the part of the utilities and I am happy to see this and other small utilities taking the lead. Thanks.
Luis G. Vargas Jr.
Are there legal challenges to the smart grid concept? This seems to me to be a colossal invasion of privacy and without precedent. Industry wires like yours are buzzing with this idea, but nothing from the general media. What gives?
Bill Asbury
Ces, Please (seP/oCT)
You left out one of the dumbest uses of electricity in your article on consumer electronics. That is the power the various appliances use when they are off. The effort to get underneath things to unplug them when not in use is not justified. Managing these types of energy uses
might have more payback than the smart grid at the residential level.
Dick Maclay
leTTers from readers (seP/oCT)
I almost fell off my chair reading a letter mentioning how mandatory demand side management programs
appear to be some conspiracy on the utilities’ part to construct a system with our money and instill govern-ment control? This kills me because this industry has sat idle for decades and now we are pushing for better, more efficient technology to provide benefit now and in the future. How can you ask if it’s good for the people? For example, how about being able to know when high demand days are driving up your average monthly cost simply because other people are running their air conditioning units? The people would be alerted to the fact that you are paying the most you will that year for that electricity. Information is power—power to the people.
Jamie Decker
To contribute to the Transmissions department,
please e-mail your submission to [email protected]. Provide your name, address and daytime phone number. letters may be edited for style and space.
Letters from readersEditor in ChiEf H. Christine Richards
[email protected] 303.228.4762
MAnAGinG Editor Kate Rowland
[email protected] 805.807.8508
ChiEf CoPY Editors Martha Collins, Joe Kovacs
sEnior ContriBUtors
Warren B. Causey
Vice president, Sierra Energy Group
[email protected] 770.443.8566
William Opalka
Editor-in-chief, REB Daily
[email protected] 860.633.0090
Ken Silverstein
Editor-in-chief, EnergyBiz Insider
[email protected] 304.345.5777
Bart Thielbar
Senior research analyst, Sierra Energy Group
[email protected] 507.283.9034
fEAtUrE WritErs William Atkinson, Mike Breslin,
Curt Harler, John Johnson, Phil Johnson,
Dennis Keim, Joe Kovacs, Laurel Lundstrom,
Elizabeth McGowan, Mary Ann Stewart
sEnior ViCE PrEsidEnt/GroUP PUBLishEr Tim L. Tobeck
[email protected] 303.228.4752
CrEAtiVE dirECtor
Jürgen Mantzke
dirECtor of MArkEtinG And AUdiEnCE dEVELoPMEnt
Michael Guilfoyle
[email protected] 303.228.4763
dirECtor of ProdUCtion And CirCULAtion
Sarah W. Frazier
[email protected] 303.228.4733
ACCoUnt ExECUtiVEs
Todd Hagen, Alexsandra Lemke, Ken Maness, Jean Micketti
[email protected] 303.782.5510 x100
AdVErtisinG CoordinAtors
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MArkEtinG MAnAGEr Stephanie Fisher
tEChnoLoGY MAnAGEr Dan Wilson
CirCULAtion CUstoMEr sErViCE Cindy Witwer
BiLLinG Monica Coffey
EnErGY CEntrAL www.energycentral.com
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ViCE PrEsidEnt/ContEnt Mark Johnson
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Request a subscription at www.energycentral.com/iumag.
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offiCiAL AssoCiAtion PArtnErs
GEosPAtiAL PArtnEr UtiLitY iCt PArtnEr AdVAnCEd MEtErinG PArtnEr
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Balancing reality with vision and strategy. This
magazine focuses on what real utilities are doing today to build a more intelligent utility. at the same time, however, we need to consider how today’s actions contribute to a company’s smart grid and intelligent utility vision. Therefore, this magazine groups articles that deal with the vision, strategy and reality on key topics. note that some articles may cover more than one area.
you will notice the following tabs throughout the issue:
REALITYSTRATEGYVISION
Vision: an article that focuses on a utility’s long-range goals, a direction the utility industry may be heading in or the possibilities with a new technology or a technology that has yet to be introduced.
REALITYVISION STRATEGY
Strategy: an article that discusses a plan of action for achieving the goal or dealing with changes in the industry.
VISION STRATEGY REALITY
Reality: an article that looks at where utilities really are today. for example, there may be great strategies and visions out there, but utilities today may face challenges in heading toward the vision.
an inTelligenT UTiliTy aPPlies informaTion To energy, maximizing its reliability, affordability and sustainability from genera-
tion to end users.Energy Central examines the possibilities of the intelligent utility in terms of:
People ?? theknowledge,skillsandabilitiesrequiredinaninformation-enabledenvironment
Process & technology ?? Businessobjectivesandtheirimpactonprocessandsmarttechnologydeployment
Economic models ?? thechallengesandopportunitiesofnewparadigms
Finance ?? investmenttrendsassociatedwithsmarttechnologies
Public policy ?? theimpactofpoliticsonenergy
What is an intelligent utility?
it’sallaBoUtdelivering©©
inFormation-enaBledenergy.
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AT&T is pioneering smart grid technology, helping to cost-effectively revamp systems, support
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it can turn off air conditioners during peak hours.
Consumer advocates say that state utility commissions are under increasing pressure to enact smart grid programs with an advanced metering component. It’s especially true now that $4.5 billion in federal stimulus monies is being made available to valid projects. Fields said that commissioners must exercise restraint, noting that rushing headlong into something that is unproven and so expensive might later be regretted.
eleCTriCiTy flow
The architects of the intelligent utility do not necessarily disagree with
in some CirCles, PUsHing smarT meTers may end UP being dUmb policy. But a wave of public relations is now drowning out the skeptical
voices necessary to ensure that the public does not get bamboozled, some consumer advocacy groups say.
The essence of this argument is that smart meters capable of reaching inside homes and adjusting energy consumption have yet to bear fruit. And if they are unable to do so, it would be consumers who pay for any failures.
“The concept that customers can reduce load on peak days and pay less is solid,” said Bill Fields, senior advisor, Maryland Office of People’s Counsel and chairman of the electricity committee for the National Association of State
Utility Consumer Advocates (NASUCA). “That’s been going on a while. It is a ques-tion, however, of whether the advanced meter initiatives are the most cost-effective way to accomplish that. We have proven methods already. What more does it achieve for us to do advanced meters?”
Consider Baltimore Gas & Electric, which plans to replace meters with long life spans that have not yet fully depreciated. The job will cost around $500 million and consumer advocates are unconvinced of the professed benefits. Beyond the high price tag, they say the utility already has a cycling program whereby
Smart skepticsconsUmeradvocacygroUPsvoiceconcern©©
by Ken silverstein
REALITYSTRATEGYVISION
CONSUMER ADVOCATESThe next three articles talk about the clash sometimes between consumer advocates and the smart grid. Ken silverstein looks at advocacy at a broader level. Then aarP provides its thoughts on smart meters. lastly, Phil johnson looks at consumers and beyond in delaware.
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wHen PeoPle TalK smarT grid, one ToPiC THaT KeePs Coming UP is the consumer—both from the standpoint of engaging consumers and
also of using advanced technologies to generate additional value for consumers. There is certainly a lot of promise with smart grid technologies—from effec-tively integrating renewable generation to better informing customers about their energy use. But these promises come with a substantial price tag, which could significantly impact energy affordability, particularly for older consumers.
To learn more about a smarter grid’s impact on the older population, we looked to the AARP, which represents the interests of people 50 years of age and older. In its Issue Brief: Energy Affordability, AARP said that it is “lobbying to mitigate the price impact of smart grid technology, advanced metering and dynamic pricing.” To learn more about the details behind this statement, we talked with Chris Baker, who, as a strategic policy advisor for AARP, researches how changes in the telecommunications, energy and IT industries impact older people’s ability to obtain and use products and services from these industries.
smarT grid Has valUe
AARP sees value in a smarter grid, but is concerned about the value of certain components. “Smart grid is very expensive, but important,” said Baker. “Smart grid is an excellent thing to be working on, but we are concerned about the focus—particularly on smart meters. Smart meters will require a lot of money and that will affect our members.”
AARP isn’t convinced that smart meters will bring as much value to consumers as some organizations out there are promising. Rather, AARP sees more potential with investments in smart technologies for the transmission and distribution networks. “Reliability is important to older people and improving efficiency on the grid can help save money,” said Baker.
Grid firstaarPdiscUssesvalUeForolderconsUmers©©
by H. Christine richards
STRATEGY REALITYVISIONthe concerns raised by some of the consumer advocates. But they say that a key distinction must be made between the smart grid and smart meters.
According to Ray Gogel, president and CEO of Current Group, enhancing the “middle mile” between the genera-tion source and the home has added significant value. Technology that analyzes electricity flow, for example, can increase reliability and diminish volatility by allowing utilities to pinpoint overloaded transformers and thereby avoid power outages.
The verdict on the “last mile,” or from the meter into the home, is still out, said Gogel. If smart meters are to work, utilities must get consumers to interact with them.
“Most of the value will come out of the middle mile,” said Gogel. “It’s still too early to tell whether the ‘last mile’ will pay off.”
Consumer advocates would agree with that assessment. Charlie Acquard, NASUCA’s executive director, said that upgrades to the transmission system intended to improve efficiency and accommodate more renewable energy are wise. But investments in new meters may be akin to “shiny new toys” that amount to nothing more than false promises.
“Smart meters can be costly and we do not know how consumers will respond to them,” said Acquard. “We want to see how cost effective they will be when compared to the current technologies.”
Modernizing the transmission grid is generally considered necessary to increase reliability and to deliver more green energy. But speculation on smart meters per se is less popular and even worrisome. It’s particularly true among some advocacy groups who feel that consumers may fare better by conserving energy the old-fashioned way.
Ken Silverstein is editor-in-chief of energyBizinsider.
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based on iTs modesT geograPHy, delaware migHT be dismissed by some in the greater U.S. business equation, but omitting the state in
any serious business discussion constitutes a considerable oversight.Delaware actually maintains a rather lofty business profile—and
not just because it’s home to leading global businesses such as DuPont. The state’s inviting busi-ness/incorporation legal structure, for example, has long been a magnet for major companies to incorporate there, regard-less of how close to the state the companies’ actual offices and headquarters may be.
And today, with the developing smart grid becoming more established among electricity providers everywhere, Delaware may well represent no less than a potentially prime influence and trendsetter for the nation.
Among the state’s many interesting facets that are inter-laced with its electric service is that Delaware consists of only three counties: New Castle, Kent and Sussex, north to south. Much of the electricity in the two southern counties is provided by the 80,000-meter Delaware Electric Cooperative.
New Castle County, the northern-most and by far the most densely populated—and incorporating the communities of Wilmington, New Castle and Newark—is served primarily by the one and only investor-related utility in the state, Delmarva Power, which is itself an electric delivery subsidiary of Pepco Holdings Inc. Delmarva also serves numerous incorporated areas in Kent and Sussex counties. The coop, in turn, serves unincorporated areas in Delaware’s two southern counties.
Additionally, scattered across the state are municipal power authorities in the communities of New Castle, Newark, Middletown, Clayton, Dover, Smyrna, Milford, Seaford and Lewes.
Blue hen statedelaware’ssmartgridProgress ©©
by Phil johnson
STRATEGY REALITYVISION“smarT” edUCaTion
AARP’s approach toward smart grid is less about educating its member-ship and more about reaching out to people making decisions about and influencing smart grid investments—including submitting comments to the Federal Energy Regulatory Commission about its concerns. “And we have been working at the state level to make sure people understand what the benefits are and what the costs are,” said Baker.
But with the increasing interest in customer engagement, some smart energy devices will likely end up in people’s homes. Baker maintains that people will adopt new technologies if they are user-friendly, helpful and affordable—older people are no different. For example, “Older users not only play video games more often than younger users, but also spend more time playing per session,” said Baker.
At the same, even with interest in more advanced technologies, there are also more “old-fashioned” approaches to changing energy consumption patterns. Energy efficiency and energy conservation are terms that get tossed around in the utility industry, but “we have to be careful with that message,” said Baker. “In the 1970s, with energy conservation, people thought that it meant putting a sweater on. But people may have issues with medica-tions that can affect their ability to stay warm. The aging process can make it more difficult to maintain a body temperature that is safe. Public health and energy advocates have moved along in different silos, but the connection between affordable energy and sufficient health is going to grow.”
“People want to save energy,” said Baker. “But there are ways to make the system more efficient that can benefit energy consumers,” which for AARP means focusing more on technolo-gies that make a smarter grid before making a smarter meter.
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At CenterPoint Energy, we understand that consumers don’t
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Delaware Senate. McDowell views smart meters as potential tools of consumer empowerment.
“Smart meters should serve as ‘ledgers-of-account’ for sustainability,” McDowell said. “Sustainability—in the form of energy efficiency, energy conservation and customer-sited renewables—is our largest resource. It’s our cheapest resource. It’s our cleanest resource. And it’s the one that’s almost
impossible to export, in terms of jobs.”Putting teeth in his sustainable
philosophy, McDowell helped engineer recently enacted state legislation that encourages Delaware utilities not only to substantially augment renewable resources within their portfolios, but also to take whatever measures may be required to achieve a reduction of at least 15 percent in Delaware’s overall electricity consumption by 2015.
The legislative action, as intended, has prompted immediate formulation of blueprints relating directly to the question of how theory comes to grips with reality—and realistically, how the greater system advances from here to there.
“When we look at how we’re going to work with the utility and
Commission aCTion
Delaware’s Public Service Commission, with five gubernatorial-appointed commissioners, oversees multifaceted utility and other public infrastructure func-tions, but regulates the rates of only Delmarva among the state’s electric delivery companies. The cooperative and the municipal power providers are essentially self regulated.
Public Service Commission staff members say that, although they are responsible for regulating the rates of just one utility, they avoid overstepping.
But it can be a fine line. One example involves the potential that the commission could decide to mandate parameters for the regulated utility, Delmarva, that do not apply to out-of-state competitors that are allowed to sell energy and services in Delaware under state law enabling retail energy competition.
“Potentially, we’re looking at dynamic pricing,” said Bruce Burcat, executive director for the Public Service Commission. “We’ve opened a docket looking into determining how we should potentially price electricity at various points during the day.
“So at peak time, rather than just advising people they should be reducing usage, they would have some pricing incentives to reduce the peak by deferring a
lot of their usage to other times.”And the commission may eventually decide to
leave it up to the consumer—that is, in this case, only Delmarva’s consumer—whether or not to select dynamic pricing from among a range of choices.
If, however, the commission were to mandate dynamic pricing at Delmarva, that could affect the utility’s competitiveness against out-of-state entities that are not subject to commission regulations.
sUsTainable generaTion
This also highlights other important regional factors. Constraint within crowded transmission routes in the eastern United States is an ongoing issue, and the PJM Interconnection is moving forward with multiple transmission-related
efforts at the greater regional transmission organization level—including the Mid-Atlantic Power Pathway, development of which is regarded as essential for Delaware and the region.
Delmarva is also involved in an agreement to eventually distribute power from a proposed offshore wind farm that has yet to begin construction, and yet another portion of its sourcing is to be derived from recently negotiated onshore wind contracts. Delaware Electric Cooperative has wind generation in its portfolio through its approximately 16 percent ownership interest in Old Dominion Electric Cooperative, a generation and transmission coop.
Finally, other current sources for Delaware electric utilities run the gamut from coal to natural gas to nuclear, plus future innovative clean energy plans and aspirations that rank among the most forward-looking in the nation.
“The consumer has to be the first responder for sustainable energy,” said state Sen. Harris McDowell, who chairs the energy and transit committee in the
“Electricity�consumers�
don’t�really�care�how�
many�kilowatt-hours�
they’re�using�…�
they’re�concerned�
about�how�much�
they’re�paying�for�it.”
BlUE hEN STATE ViEwpOiNTSBill Andrew
President and Ceo, delaware electric Cooperative
Bruce Burcat
executive director, Public service Commission
Harris McDowell
delaware state senator
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the Delaware Division of the Public Advocate and other interests to design the rates, we have to look at it with a view of meeting the objectives of the legislation,” said Burcat. “I think we’re going to look at a lot of the research as to what programs potentially reach different goals, because we’re looking at pretty significant goals, and it’s important we work with the utility to make sure it’s in compliance with state law.”
That utility, of course, is Delmarva. But what about Delaware’s self-regulated utilities?
CooPeraTive PersPeCTive
The President and CEO of Delaware Electric Cooperative is Bill Andrew—formerly an engineer with Delmarva—who today delivers televi-sion public service messages relating to energy conservation and hosts an
electricity-themed radio talk show in Delaware.Andrew is a crusader for the coop’s “Beat the Peak” initiative, which is pretty
straightforward: when peaking energy circumstances warrant, Beat the Peak initiates an e-mail-based system calling on volunteers to cut back on their basic electric usage during specified peak hours.
Crediting Beat the Peak for saving coop members $2.6 million in 2008, Andrew projects savings approaching $4 million or more when the figures are added up in 2009.
“It’s almost so simple, it’s stupid,” said Andrew. “All I know is it works.”Planned next for Beat the Peak are customer-alert devices designed to work
based on mostly installed smart—largely smart meter—technologies.Believing he has a finger on Delaware’s electricity pulse through input from coop
members as well as from anybody and everybody who calls in to his radio talk show, Andrew said, “The most important part of the smart grid is the member, it’s the end user. And we don’t need to overcomplicate that.
“You can put on all the systems you want and overcomplicate things. Electricity consumers don’t really care how many kilowatt-hours they’re using on a daily basis or a monthly basis. More so on a monthly basis, they’re concerned about how much they’re paying for it.”
Andrew says consumers will take action if it means they’ll not only be applying sound environmental procedures and saving energy, but also saving on their energy dollars.
Phil Johnson is a freelance business writer and speechwriter.
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Aclara_leads.indd 1 8/5/09 7:56:26 AM
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PePcodiscUssesdelaware©©
meteringdePloymentby H. Christine richards
wHen i seT off To visiT a UTiliTy wiTH 1.9 million customers in Delaware, Maryland, New Jersey and
Washington, D.C., I was surprised to find myself at a Pepco Holdings Inc. (PHI) office in the New Jersey countryside. I not only learned why New Jersey is called the Garden State during that visit, but also gained insight into PHI’s Blueprint for the Future initiative—particularly its advanced metering infra-structure (AMI) deployment for the Blue Hen State of Delaware. I spent an early fall day visiting with six key personnel involved in these efforts. I want to share some high-lights—including the company’s automated deployment process for its smart meters and change management that focuses on more than just training. But before we get into all of that, let’s review PHI’s initiative.
overview
Blueprint for the Future is a vision for PHI to “be a trusted partner as we enable a reliable, energy-efficient and environmentally friendly tomorrow for our customers.” One of the vision’s goals is to modernize PHI’s infrastructure to provide better service in a digital age. PHI is looking toward a smarter grid to:
empowercustomerstomakeinformeddecisions??
adjusttochanginggridconditionsautomatically??
operatethegridwithgreaterefficiency??
Promotegreenenergy—includingdistributed??
renewablegeneration
DEplOyMENT plANSPHi already has its blueprint for the future, so this article explores the utility’s advanced deployment process and extensive change management efforts.
VISION REALITYSTRATEGY
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METERiNg BlUE hENS
On the technology side of a smarter grid, PHI is working on AMI, demand side management, workforce management, communication infrastructure, distribution automation and switching to direct current for the Mid-Atlantic Power Pathway transmission line. During my visit, we focused on AMI and communication infrastructure components. PHI will deploy 430,000 smart electric meters and gas meter communication modules in the company’s Delaware territory between November 2009 and the end of 2010. When I talked with PHI, the company was just wrapping up field testing and gearing up for the full deployment.
However, it wasn’t just about the meters. “A meter is just a meter until you start to connect the dots and put in all of the technologies that go along with it and then integrate it with the processes to make it whole,” said Andrea Turley, senior project manager, business transformation, who works on the AMI systems integration. Such systems include the AMI head-end system, meter data management system, outage management system, customer Web presentment and AMI portals for personnel such as customer service representatives.
“There is also the order of magnitude from the technology side. There are a huge number of applications and data points, so just being able to do this redesign is what I think really makes this different than some of our other processes,” said Todd McGregor, program manager for the advanced metering program in the business transformation group.
Even with the current focus on technology, it is the customer that motivates PHI. “It is about visual-izing the customer benefits and translating those benefits to tech-nologies,” said Turley. “Knowing the end results in terms of customer wants and needs helped us pull together the requirements.”
McGregor also said, “It’s going to touch all our customers—no project before has done that. This one looks at how we’re going to operate in the back office and how we’re going to operate in the field. It’s going to impact people’s jobs and touch all of
our customers in some fashion even if they just get a letter in the mail that says, ‘Hey, we’re coming to exchange your meter.’ We’re going to touch all of them.”
aUTomaTed dePloymenT ProCess
So with all this talk about advanced technology for the grid, it only seems fitting that PHI would use advanced technology to help get everything in place. I covered many topics with McGregor, Dale Gant, Tina Lloyd and Matt Lenzini (see sidebar), but let’s go ahead and jump right into the discussion about PHI’s automated deployment process.
deployment logistics
IntellIgent UtIlIty Okay, so now that you’ve mentioned the end point deployment, what’s going on in that area?lloyd We’re working with an end point installation vendor for the deployment. One of the first key deliv-erables for planning was to provide a planning file. The planning file provided all of our customer premise data to the vendor so that they could develop a deployment strategy. A preliminary design included how they would roll out the meters and what’s the most efficient way to deploy Delaware within the timeframe that PHI wants it done and within the cost that they provided us in their contract. We had some other requirements pop up after going through some interim process planning and working through the system integration piece. We had to consider all of our types of meters and conditions in Delaware and go back to the drawing board with the vendor and say “give us a revised deployment plan.”
So, at the end of July they provided a master deployment plan so we know their plan, including which routes they’re going to start off with and how many meters are in those routes. They’ll run the field deployment out of cross docks and they plan to have three different locations in Delaware—north, central and south. At any given time, we’re only going to have two cross docks up and running.Mcgregor Do you want to describe a little bit about what goes on at the cross dock?lloyd Yes. The cross dock is actually where the contractor will manage the deployment. They’ll train their field installers on how to do meter exchanges. They will have their own work order management system, and that’s where they’ll do their inventory management tracking. We’ve also asked for space in the cross dock to put some equipment in there to do ad hoc meter testing or meter programming. The cross dock is going to be the hub that everything will be worked out of.
Dale Gant, manager, meter
services
assigned to the ami ??
project for the last two and a half years
worked with PHi for 22 ??
years
Previous experience ??
was with atlantic City electric as a plant electrical engineer
Matt Lenzini, supervisor,
information systems
Currently heads up the ??
automated deployment side of the ami systems integration effort
Has been with PHi for ??
just over five years
originally joined as ??
a consultant to help lead legacy iT system integration
Tina Lloyd, senior project
manager, business
transformation
Currently ami ??
deployment project manager
Celebrated 20th year ??
with the company on september 26th
Previous experience was ??
with delmarva Power, starting in the call center
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PHI and contractorPHI and contractor
Contractor
Contractor
Contractor
Contractor
Communication network provider
AMI technology
PHI
PHI
PHI
1 25
8
6
74
3
11 10 9Establish communication with AMI meter/module (Day after installation)
Create overall deployment plan (after contract signature)
Place orders for AMI meters and modules(16-20 weeks in advance)
Refine deployment plan to reflect specific areas for installations (5-6 weeks in advance)
Install LAN access points and relays (4-5 weeks in advance)
Receive, test and warehouse meters and modules (3-4 weeks in advance)
Schedule routes for installation (2-3 weeks in advance)
Notify customer of pending meter exchange/module installation (2-3 weeks in advance)
Complete meter exchange/module installation (Daily)
Salvage removed meters (2-3 days after installation)
Source: PHI
Update C3/CIS with exchange/installation information and handle exceptions (Day after installation)
METERiNg BlUE hENS
figurE�1:�PHi�AutoMAtEd�dEPloyMENt�ProcEss
Because it’s a contractor, and PHI or Delmarva Power didn’t have the space to accommodate them, they have to find warehouses and then establish the warehouses to make them more conducive to handling. They might have an office environment there, too. They might have an environment where they’ll have the applications or the computers to run all of this stuff. Basically, it’s where everything will move in and out during deployment.Mcgregor And so our meters will ship right to those cross docks and then the contractor takes custody.lenzInI It updates their inventory and then manages that inventory as they deploy things.Mcgregor So that’s the inbound, and then on the outbound the installers show up every day, they get their orders, they go out and exchange the meters, they bring the old ones back, and then they’ll recycle the old ones and salvage what we can of the existing ones.gant The key thing here is that contractors come in with their own work order management systems. Now you’ve got 60 installers that are out running across the territory exchanging meters. They have their own handheld devices. They get out and they do that exchange, they update the
system, it comes back and it’s automatically updated in our system.
It’s not a paper trail; it’s all electronic. So that’s how the field installers get to orders every day, that’s how they go out and do the work and that’s how they come back, and that’s how our contractor can track the work at an individual level and also help us get files back and forth so we know what’s been installed and what hasn’t been installed yet.lenzInI Right. We’re also going to have a Web portal that’s available to select PHI employees, so they can see in close to real-time what’s actually going on with these exchanges. So if I’m in a customer service role and I want to know why somebody’s complaining that someone was in their yard today—or whatever reason you want to know what’s going on out in the field with these exchanges—you can look at this portal and see what jobs have been scheduled that day and what’s been completed. You will also have the ability to look at pictures of the meter that was pulled out and validate that this was the last read if a customer has a bill dispute.
IntellIgent UtIlIty So PHI worked on the Web portal? lenzInI The Web portal is actually something we
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KE_adv_usletter_Utility_13.indd 1 25-11-2008 17:17:46
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METERiNg BlUE hENS
contracted with our installer and they’re developing it and are going to provide that service to us.
IntellIgent UtIlIty It sounds like you have to work with your contractor to integrate all of this information. How has that gone? What were some of the areas you had to work through?lenzInI Our contractor has been very accommodating. I think it has been a good partner to work with. If you look at the process overall, a lot of it was taking the early work that was done, looking at the deployment process overall and turning that into a set of systems requirements. Essentially, here’s the process and here’s what we think we need to build in order to support that process. There were meetings and conversations about how to look at these processes and determine how we can enable these things through technolo-gies and get the transfer of data back and forth.
You take those system requirements and turn them over to a development team, and they use those to build very specific technical specifications of, OK, here’s the interface, here’s the program code that needs to be built, here are the data elements that need to be transferred between two systems, and then that actually turns into an application development project. We’ve incorporated our contractor into those conversations. For the most part it’s going well. I think with any vendor relation-ship when you’re managing across time zones and in different locations—they’re not physically on site—there are logistical challenges that we have to work through. However, having regular conversations, being very specific in our requirements has helped set everybody on a fairly clear path of what we expect to be delivered.
IntellIgent UtIlIty Sounds good. It seems that there are always challenges.lenzInI No matter what we do, there are going to be challenges. When you’re working with the total system architec-ture—there are 82 systems interfaces. To put that in perspective, we maybe build a handful of new system interfaces in a given year. We’re doing 82 at once. The scope of it is massive. Now 20 of those are actually just focused on the deployment automation piece and the other 60 are more focused on how to provide these customer-facing benefits like the over-the-air meter reading and then billing based on those readings.
Without getting too deep into the technical specifics, we’ve got all of these systems interfaces and all of these different legacy technologies. So you may have a mainframe applica-tion that needs to talk to a Windows application that needs to talk to a UNIX application, and they don’t speak the same language. Rather than building point-to-point interfaces
between systems, we’re using an enterprise service bus as a moderator to handle the translation of protocols, languages and data between systems. This really becomes the central hub between systems and all of the applications—vendor appli-cations, internal applications—will talk to the service bus, which will then handle the translation, the data conversion, the manipulation of data and in many cases the pending two pieces of data that may not mean anything individually, but have value when they’re combined, and then pushing that on to the next system. The service bus technology is really what’s enabled us to do what we’re doing on the scale on which we’re doing it without having it become unmanageable.
CHanging CHange managemenT
After all of the tech talk, it was exciting to sit down and talk with Sherri Stewart (see sidebar) because when you really look at the whole notion of a smarter grid, it involves so much more than just technology. As Stewart noted, the people aspect “sometimes gets lost in the sauce.” Stewart and I covered everything from raising awareness about AMI across the company to dealing with AMI anxiety among employees to changing change management.
raising awareness about ami
Stewart We’ve developed an online newsletter, AMI Today, that brings people up to speed on what’s happening on the AMI project. We just developed and delivered an AMI
survey to understand where people are, what they know, what they need to know, how much information is getting out there to them, who is providing the information and whether they feel like they’re getting enough information. That’s been our change readiness to get the ball rolling. We’re also looking into developing our own Web page.
IntellIgent UtIlIty When will the Web page come out?Stewart We’re in the process of devel-oping a draft and proposal, because right now there’s a Blueprint for the Future page,
but when you click on it, it doesn’t have enough detail to give people a sense of “how is it going to impact me?” So, we’re really trying to bring it down a level to make it more personal, especially since AMI is a larger initiative and that’s what people are really looking at. We do have other projects under Blueprint for the Future, such as work management and some others, but really the one that is sort of touching the hearts and minds of people right now is AMI. We want to give them something that they can hold on to and understand.
Sherri Stewart, business
process consultant,
business transformation
bridges gap between ??
processes, technology and performance for blueprint for the future
employed with PHi for ??
over eight years
started in the training ??
department
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IntellIgent UtIlIty What about additional communi-cations with people throughout the company who may not usually get to talk about AMI? Stewart We also have change agents. These folks are throughout the company, maybe 50 or 60 people. They are our advocates for spreading information and news. They hold their own meetings and sometimes they will do displays. We’ve done some of that with some of the groups that are local here, but we need to fan out a little bit more so that people, even if they’re not going to be touched by AMI, understand it and understand what the impact is going to be to the organization as a whole.
dealing with ami anxiety
IntellIgent UtIlIty What do you do if people are concerned about AMI and smart grid? How do you deal with anxiety?Stewart Change is very dynamic. It always happens all around us, and most people are very resistant. And people will tell you, “Oh, it’s OK, we roll with the punches.” Well, not all the time. The one thing that we’ve done, and will continue to do, is communicate with people and make sure they understand what is going on and where we are as we step through these processes. Things are changing so fast from day to day and it’s not always easy to get the correct information out to them right away. But we do make every effort to make sure that people are well informed about what’s happening along the way and how it will impact them.
IntellIgent UtIlIty Yes, because right now you’re really working on getting all the technologies together, the processes together and then pushing them out.Stewart Right, so we know that if you’ve got the tech-nology, that’s great, and now you know what the process is in order to make that functionality work. We’re at the point at which we’re getting through the processes so we know what they need to do. We’re still at the “What do they need to do?” stage. Once we get past that, then we can really hone in on who needs to do that, what skill set is required to do it and where should they be. Is it this group or is it that group? Do we have a group already in place and just need to train them more or do we have to develop those skills? And then, what kind of training is going to be required to make sure that we can run this smoothly?
rethinking change
IntellIgent UtIlIty I talk with people who say they’re going to do change management and the discussions usually end up focusing on training. Stewart People tend to think that change management means that we’re going to train some people.
IntellIgent UtIlIty Yes, that’s how it usually comes across.Stewart We used to sort of bury change management under training and then the people are coming to your class asking, “So why am I here?” And that’s not good! It’s not good to be asking me at the 99th hour why you’re here. At the end of the day, change management really is about making sure that people are ready, willing and able to do their jobs. Ready in the sense that they understand what’s going on, willing because they’ve accepted the change and are able to do it because we’ve got them doing the right task and the right training in the right role.
IntellIgent UtIlIty What have been some of the key chal-lenges so far?Stewart Getting people to understand why these changes are important and what’s in it for them have been the biggest challenges. We talk about the technology and it all seems great, but at the end of the day, the challenge is to really bring it down to a level that’s personal enough so people can see what’s in it for them and then be more engaged and excited about new technologies and what’s happening out there in smart grid and AMI.
IntellIgent UtIlIty Part of it too seems to be that we’re looking at a little bit longer-term picture with things such as delaying the construction of new generation or dealing with carbon legislation and regulation if it really comes into play. It seems as though all of it’s a little bit further off for people. Stewart It is, and it’s very hard to get people to embrace something that seems so far away. It’s like Star Trek. It’s so far in the future that you can’t imagine what it’s going to be like. For example, who knew cell phones would be as popular as they are? Technology in the beginning is very hard for people to get their arms around when it’s so far away. It doesn’t feel tangible.
IntellIgent UtIlIty What has been the most inter-esting aspect of this project for you?Stewart It’s one huge project that we’ve broken down into pieces to manage better, but there are so many things going on. It’s changing all the time and it’s very dynamic. We’re just staying one step ahead—and sometimes we’re not even quite a full step ahead. We try to not look at it from a project-to-project perspective, per se, but more all the way across the board—doing newsletters and things like that to address all of these different projects as one big entity. Essentially, it is about keeping all of those balls in the air. That’s been a fun part.
the�people�
aspect�
“sometimes�
gets�lost�in�
the�sauce.”
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The offensesmartmeter+slotmachine©©
secUrity by mike breslin
wHen Tommy CarmiCHael—THe world’s greaTesT sloT machine cheat—wanted to illegally coax coins out of
Las Vegas slot machines, his first step was to get his hands on the machine he wanted to cheat. He was successful at beating the best electronic security that slot machine engineers could design and milked hundreds of thousands of dollars before he got arrested.
Coincidentally, Las Vegas was the scene last July where the supposed security flaws of smart meters were unmasked. That event still has meter makers, utilities, standards organizations and federal regulators talking or hard at work improving security.
At the Black Hat security conference, Mike Davis, a senior security consultant for IOActive, demonstrated how his secu-rity team simulated the hacking of 16,000 out of 22,000 smart meters over a 24-hour period. They used a worm, a software patch, that gave IOActive the control to turn power on and off at one-second intervals at 16,000 homes.
“We could have put anything in that worm we wanted as a payload,” said Davis. “We did not have enough room in the smart meter to fit our code so we had to dump some functionality out for our worm to work. The functionality we dumped was the ability to wirelessly update the devices. That
Nitty gritty of cyber security
STRATEGY REALITYVISION
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would have locked out the utility from wirelessly updating the devices.”
Like Tommy Carmichael, IOActive had to get its hands on a meter before starting to compromise it. In 2008, the first meters they examined came via a penetration test for a utility. “This is how we initially found some vulnerability,” Davis explained. Later, IOActive bought different models on eBay, and got others by dumpster diving at the back of utility meter shops. The discarded meters provided all they needed—radio communications and firmware. Since Black Hat, Davis no longer sees smart meters on eBay and noticed that defective units are now being sent to secure recycling facilities.
“As much as I’d like to say I am a profes-sional, I’m really a geek at heart. I’m only in it to play with the toys,” Davis admitted. IOActive used two smart meters to build the worm and it did not take expensive equip-ment. Davis confessed that the most valuable tool he used cost $200, a JTAG interface.
Davis reflected on industry reactions since Black Hat. “I’m sure someone inside our company assumed that if we are talking about this we would be the go-to guys for this particular issue. A lot of the feedback we got was that we were not telling the truth about the vulner-abilities, or no meter vendor would ever release their devices without encryption enabled, or even if this were possible, the propagation rate of the worm would be so slow that it would not matter. When our research hit the news it was about the same time the stimulus package came out with funding for meters. People acknowledged us, but no one really wanted to work with us. They just wanted to get their product out.”
Of course, a malicious hacker would only have to rip a meter off a house to get started. And what could a criminal or terrorist with reverse engineering skills do? One feature in many devices is a remote disconnect that allows the utility to wirelessly disconnect an individual meter from the grid. “The nature of the worm we demonstrated is the danger that we were able to propagate it without the need for the utility. If we propagated it to hundreds of thousands of meters, we would have the ability to disconnect those,” Davis said.
Because meters are wirelessly linked by radio frequency with a one- to two-mile range, worms or disabling viruses could hop from service area to service area on interop-erable metering systems.
What are the consequences of hundreds of thousands without power? Someone would have to figure out how the meters are being exploited, create and test a corrective patch and, if firmware is compromised, individually deploy patches to every affected household. “We will continue our research
as soon as I get my hands on another device. These devices were made to be sensors, not security devices, and that’s what we are seeing in the state of hardware security everywhere, except for devices like XBox, or PlayStation® where they really care about tampering,” Davis concluded.
But the major meter manufacturers are improving secu-rity. Philip Mezey, North American senior vice president and COO for Itron, had this to say: “Security of advanced metering and smart grid networks is very much something that Itron and the utility industry has taken, and will continue to take, seriously.”
OffENSE + DEfENSEThese two articles explore the balance of cyber security attacks and defenses. mike breslin chats with a “hacker” who makes a living breaking into systems. Then we take a look at oncor and its continual work to step up the defense.
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The defenseoncorkeePsraisingtheBaron©©
secUrityby H. Christine richards
onCor is bUilding inTelligenCe aCross iTs network—from synchrophasors on its transmission
networks to advanced metering on homes and businesses. Mark Carpenter, Oncor’s vice president and CIO, noted that the utili-ty’s smart grid “is not any one thing, but is essentially spreading intelligent devices throughout the utility system, building a communications network to support these devices, bringing the data back and converting it into useful information.”
A smarter grid will bring Oncor numerous benefits, but it will also create security challenges. “Unfortunately, we have some very smart, innovative, creative people who want to cause mayhem,” said Jim Greer, Oncor’s senior vice president of asset management and engineering. During a recent inter-view with Intelligent Utility, Carpenter and Greer discussed how Oncor secures its increasingly intelligent grid.
bUilding on PasT exPerienCe
“We recognize that Oncor is starting out with a very secure platform,” Greer said. “We’re wrapping the new advanced metering system with the same protective layers used to secure our transmission grid management system. At the same time, we’re adding additional layers of security, control mechanisms and risk mitigation to address newly exposed security risks. The advanced metering system is not just another business management or business information system. It’s really in a different category. The system requires data network security, firewalls and penetration testing.
“But security—whether it’s in utilities, banking or another industry—is never going to be good enough. Therefore, it’s essential to always be on guard. Oncor is constantly moni-toring, testing and moving to the next level. Our vendors are clearly prepared. We’re participating in standards develop-ment and helping shape that outcome. We understand and recognize that it’s never going to be good enough and we keep moving the bar up.”
balanCing PHysiCal + Cyber seCUriTy
With respect to key components of a smarter grid, Carpenter addressed physical security and cyber security for commu-nications networks, meters and home energy devices. First,
he explained some protective measures for communications infrastructure. One example of physical security is leveraging the existing security of substations. Oncor places some of its communications infrastructure in substations, “partly because of the additional security that we get. Although we have func-tional security, we don’t want a bad guy to be able to get into a communications box. We’ll be able to tell if he gets into a box, but he is first going to have to go over a fence.”
So what about the physical security on the meters? “We continue to work on physical security. In areas where meter theft or moving meters around is common, Oncor installs brackets that make it a lot more difficult to steal meters. Potential thieves have to break locked physical barriers.
“In the future, software will let us know about theft. When somebody steals an advanced meter and puts it somewhere else, we will know it.”
PowerPoinT seCUriTy?
Carpenter also talked about a recent PowerPoint slide deck. “Recently, I reformatted a presentation. The reason I did was for security because it had some information that I wouldn’t want to get into the wrong hands. We’re very conscious about cyber security, physical security and information security. Therefore, in a presentation, I may show something, such as a map, but I may have to adjust the map so people don’t get too much information.”
At the end of the day, “We’ve got to have better defense than they have offense,” said Carpenter. “We will never make something totally impenetrable. Security is something we continue to make great strides in improving because the bad guys have made great strides in what they do. We’re always going to have to stay a step ahead.”
VISION REALITYSTRATEGY
NiTTy gRiTTy Of CyBER SECURiTy
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Smart grids that offset emissions of 53 million cars?
Absolutely.
If the grid were just 5 percent more efficient, the savings would equate toeliminating the fuel and greenhouse gas emissions of 53 million cars in the US.ABB’s high-voltage direct current (HVDC) solutions can reduce transmissionlosses by up to 30 percent, while flexible AC transmission systems (FACTS) caneven double the capacity of existing power lines and increase grid reliability.Both technologies also enable the stable integration of renewable energy into thegrid. We’re making the grid smarter every day. www.abb.com/smartgrids
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From mick Jagger oF the rolling StoneS to Sammy hagar oF Van
Halen to Malcolm Unsworth of Itron, these lines succinctly summarized the conference’s theme: envision the future. And while Unsworth, Itron’s president and chief executive officer, didn’t belt out his classic line in song, he and others at Itron got more than 250 utilities from 12 countries fired up about the possibilities of tomorrow and how they can make those possibili-ties a reality—today. Let’s listen in on a few of the thousands of conversa-tions from the two-day conference that helped utilities not put off the future another day.
A quick trivia question:
Where did these three classic lines recently appear together?
“If you start me up, if you start me up I’ ll never stop.” 1.
“Don’t wanna wait til tomorrow. Why put it off another day?”2.
“There will never be better time to envision the future—and the 3. future is now.”
Answer: They all appeared at the 2009 Itron Users’ Conference.
Don’t put off the future another day
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Setting the stage for change
At the JW Marriott Desert Ridge resort north of Phoenix, during the opening general session, keynote presenters laid out important points for participants to remember before they ventured off to more than 150 conference sessions. These points included the fact that utilities are constantly needing to evolve to keep pace in the marketplace in which they thrive. They will need to adapt and maneuver accordingly to satisfy consumers and regulators and it will involve more than just installing an advanced meter.
Russ Vanos, Itron’s vice president of marketing, reminded participants that, despite all of the technology hype out there, utility innovation has been going on for a while. In fact, Itron spun out of one utility company’s innovation more than 30 years ago. Back in 1977, Washington Water Power Company—now Avista Utilities—recorded meter informa-tion on paper, took the information back to the office to prepare the bills and then sent those bills out to customers. This process meant not only a delay in collecting revenue, but an additional cost to send out those bills. A catalyst for changing this process arose when the postage stamp went up in price. Enterprising engineers at the utility developed a device where meter readers could enter the meter read, print the bill and leave it at the customer premise. This innovation eventually turned into Itron. In this case, a utility saw a need and made a change. Today, it is no different.
Allan Schurr, vice president for strategy and development at IBM’s global energy & utilities industry, pointed out that the need for change will never be over. “Utilities have been as smart as they need to be. But what was smart enough five years ago is not smart enough today. What is smart today won’t be smart enough five years from now.”
Unsworth elaborated on the changes happening in the industry.
Even with the uncertain economy, Unsworth noted that “there has never been a more exciting time to be a part of this industry.” For example, from the recession sprung the American Recovery and Reinvestment Act, which will help the utility industry push forward with smarter technolo-gies. Another key driver for change is the focus on energy sustainability. Unsworth encouraged participants to “envision your smart future and ask: How does it coincide with a more sustainable future for all?”
How will all of these changes shape future technology? While automating meters presents an immense opportunity—2.4 billion of the 2.6 billion meters in the world aren’t automated—the opportunity goes far beyond replacing the meter. As Unsworth pointed out, “what will happen when all of these meters start communicating?” He sees a grid that will be more like the Internet. “It will not be one technology or one communication scheme that works.”
Vanos also spoke about tech-nology change and what it will mean for the industry. “Can you envision a future where a utility can automati-cally shed load, automatically turn on distributed generation and automati-cally inject its power into the grid?” He went on discuss the numerous
other technology possibilities—from improved distribution design to advanced metering for water and gas to managing the data arising from such technologies. “Can you envision this?” Vanos then asked. “Itron can.”
The link between electricity, water and gas
Following up on the bigger picture ideals, conference participants hit the presentations. From presenta-tions like Getting University Students
Involved in Energy Conservation to Liquid Assets: Aging Infrastructure—and even a fiesta party thrown into the mix—people had plenty to keep themselves busy. The sessions helped demonstrate that change is happening today, and it involves more than just changing the meter. First, let’s look at the electric part. As Itron’s Vanos noted, there is an “undeniable link between economic growth, electric power and clean water.” And the advanced technolo-gies spreading to electric metering are spreading to water and gas meters, too.
advancing water utilities
Christopher Franklin, who works for Aqua America, Inc. as its regional
Allan Schurr with IBM Global Energy & Utilities Industry highlights his work with utility companies in accelerating the development of “smart” and the integration of renewable energy sources and distributed energy assets like plug-in vehicles.
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president for southern operations and it senior vice president for public affairs and customer operations, admitted that water has a ways to go in terms of company structure and technology. For example, water is still a largely municipal, small-time endeavor. In fact, 84 percent of water systems serve less than 3,300 people.
Aqua America realized that it could achieve economies of scale by operating a larger water system, so the company set out to unify water utilities. Since 1992, Aqua America has completed 257 acquisitions and growth ventures. This growth meant duplicative systems, sprawling call centers and varying business
processes. The company began to standardize systems and processes, and automate meters. All of these efforts provided operational benefits, but Franklin noted another important driver. “If customers are not happy, the regulators aren’t happy,” he said. “Even in a business like ours, put customers first and a lot of the rest takes care of itself.” And improving meters was again just part of the equation:
increased remote meter reading »to 615,000 units to date, which
dropped estimated bills from 20 to less than 1 percent
Moved to one customer system »
Created a “virtual” single call »center with three connected, fully redundant centers
Deployed electronic dispatch and »closing of service orders to provide better visibility into field service work
Developed key performance »metrics for transparency about how company processes are moving along
Successfully undertaking these improvements required commitment from Aqua America both now and in the future. “Improvement requires commitment in terms of changes in the process and changes in how we think about services,” said Franklin. Even with all of the improvements Aqua America has made so far, Franklin realizes that “the journey will be hard, it will be long and it will never be over.”
advancing gas utilities
The Knowledge Center—an area at the conference that displayed all of Itron’s solutions—showed that the company was thinking about more than just automating water and elec-tric meters. Mark Cornwall and Mark Stallman took time to discuss how Itron is adding intelligence to gas meters and distribution networks. Itron launched a gas advanced metering infrastructure (AMI) system, which puts smart gas meters on a two-way, expandable communi-cations system. Stallman pointed out that the system is for more than just meter reading. Utilities, for example, can also remotely turn off gas meters and determine if a gas valve failed.
Itron is also looking toward more intelligence on natural gas distribu-tion networks. At the conference, Itron announced that it is working with Mercury Instruments to enable utilities to collect information from Mercury’s natural gas pressure recorders and electronic volume correctors using Itron’s gas AMI network technology. On top of this collaboration, Itron is automating other parts of the natural gas distribution networks. This includes automating cathodic protection systems, which help protect distribu-tion network pipes from corrosion. Utilities typically send a field crew out to check on the anodes across the system. Now, by using the gas AMI network, utilities can monitor the anodes remotely, which can be particularly helpful when construc-tion and damage to the pipes can impact the cathodic protection system’s effectiveness. Utilities can now know about changes that day—instead of six months later—and therefore react more quickly to protect the network.
More than just meters
Now that we have looked beyond the electric piece, we can look beyond the meter. Conference presenta-tions brought together different groups across the utility company to demonstrate that it is not just about the meter. Let’s look at how
On display in the Knowledge Center, Itron’s gas AMI network allows utilities to collect two-way time-synchronized interval data and on-demand reads from its customers, as well as retrieve up to 40 days of interval data.
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increasing intelligence and a focus on sustainability—as mentioned by Itron’s Unsworth—impacts almost every part of a utility company, from load forecasting to IT departments.
generation impacts
Andrzej Zerek with Ontario Power Generation talked about leveraging information from meters and time of use (TOU) pricing in its demand forecasting system. By 2010 or 2011, everyone in Ontario will have an advanced meter, which ultimately means TOU pricing. Zerek asked “What impact on demand will TOU have?” For Ontario, the impact will really come down to price elasticity and price differential, and then calculating potential shift. Ontario will have to “forecast who we believe will be shiftable loads and how much they can change.”
It impacts
Another key area is how IT departments will be involved in developing more intelligence around the meter and beyond. More specifically, what are utilities looking at in terms of IT intelligence and sustainability? An innovation panel on the second day brought together Jim Kensok, vice president and chief information officer with Avista Utilities Corp., Rick Arthur, vice president and chief information officer with Allegheny Energy, and Jeff Wacker, a futurist with HP, to discuss the links between sustainability, IT, advanced metering and the smart grid.
Wacker set the stage for the discussion. The utility market is ripe for a lot of new capabilities, but Wacker noted that “often when you introduce new things you get people upset who won’t profit from it and a lukewarm reception from people that might profit from it.” However, he also noted that every recession is led out of the recession by inexpen-sive energy. “These are interesting
times—new times with new chal-lenges. That requires new thinking.”
Avista has taken a different approach to innovation by not starting with meters, but with an overall business goal. Avista has focused on sustainability for a while, but continues to find ways to innovate. According to Kensok, the company “has been green forever” with more than 50 percent of its power coming from hydro sources
and, since 1999, Avista has saved 130 MW through energy programs. On the gas side, Avista has saved more than 27 million natural gas therms since 1979. Kensok joked that “our cafeteria is even green—the food is sometimes green.”
But things are changing and the green pressure continues to increase. With its feeder efficiency program, Avista has developed an efficient way to install smart circuits and manage them. The IT depart-ment is starting to play more into the green revolution. For example, the IT department tries to buy green and has eliminated 4,720 pounds of hazardous materials so far. Virtual-ization is another big step to help manage data environments along with centralizing printers.
Allegheny’s Arthur pointed out his company is focused on demand
response, energy conservation and energy levels because they face penalties if they don’t comply. The company is working on smart meters, but from an IT perspective, “we are under pressure to cut costs and reduce volumes—there is a lot of pressure on companies to do that. However, IT is here to make companies more productive and cost effective, so it puts more pressure on our costs to go up.
“When you get into smart meters, you get into an area traditionally managed by guys in business, not IT.” Arthur noted that conversa-tions between business and IT groups should focus on the busi-ness processes enabled by smart meters—things like planning, outage management and outage restora-tion. The actual technology solution is something that will enable such business processes to happen.
Avista’s Kensok agrees that he is “living the same story” with smart metering infrastructure. He has gone through difficult conversations both inside and outside the utility company, noting “we’re in this together and working on it together.” Despite the challenges, the experience has been rewarding. “I love it,” said Kensok. “I couldn’t think of a more exciting time to be a CIO in this industry.”
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CenterPoint Energy »
DtE Energy »
Southern California Edison (SCE) »
San Diego gas and Electric »(SDg&E)
In the forum’s opening, Rich Creegan, Itron’s vice president for product marketing & strategy, noted to customers “this is your meeting.
It was constructed by you.” Indeed, this customer-driven event provided vital interactions to help customers ensure success with their OpenWay initiatives. Itron’s Vanos noted how the forum is just a reflection of Itron’s broader goals. “Clearly, we want to be a customer-intimate company,” he added. Keeping in mind the focus on the customer, let’s dive right into what happened at the forum and ultimately what attendees took away from it.
Itron OpenWay Executive Forum
and then, JuSt when you think the two-day conFerence iS oVer,
Itron comes back for more. The Itron OpenWay Executive Forum brought together four key customers currently implementing Itron’s OpenWay® smart grid system:
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For those of you not familiar with Itron openwayopenWay is an open-architecture smart grid and AMi solution that has been specifically designed to meet the ever-changing requirements utilities face. itron’s firm commitment to a standards-based, open and secure solution architecture for openWay fundamen-tally changes the landscape for smart grid technology by giving utilities the freedom to adopt best-in-class elements throughout their network. this flexible approach to system design also mitigates the risks associated with current-generation systems that rely on proprietary communications while opening the door to innovation and interoper-ability with complementary technologies.
openWay provides:
two-way communication to each meter »
Multiple-channel interval data collection »
integrated mass market demand response »
A built-in communication pathway to the home »
Smart grid features and functionality, designed to evolve over time »
gas meter data collection via Zigbee™ radio chip »
Communications flexibility
by using the AnSi C12.22 protocol for networked meter communications, openWay’s architecture is independent of any particular network communications technology. Multiple transport technologies—including rF, bPl, and virtually any iP-based commu-nications network—can be seamlessly integrated into a single system to deliver the best combination of reliability and cost.
a truly smart meter
openWay’s advantages go beyond architecture. With openWay comes the industry’s first, truly smart meter for the residential mass market. itron engineers have built upon the industry-leading CEntron® solid-state meter platform to deliver a new meter that provides modular design for broad flexibility in communications and functionality. it offers robust ‘smart grid’ functionality, including positive outage notification and a load-limiting remote disconnect/reconnect switch under glass.
Each openWay CEntron meter also comes factory-equipped with a Zigbee radio chip to enable data collection from gas meters as well as in-home communication for purposes of customer communication, data presentment, load control and demand response.
Collection engine
the openWay Collection Engine provides the interface between the metering system and utility processes such as meter data management, billing, outage management and load control. Scheduled or interactive remote reading, data normalization, event scheduling, automatic processing and more are all available through the collection engine. it can even manage firmware downloads directly to openWay CEntron meters and gas modules allowing utilities to add new features and functionality over time to support remote configuration for the evolving regulatory and business requirements of the smart grid.
What happened at the forum?
Boasting over 14 million smart meters under contract, Itron holds a commanding spot for market share in North America. In support of these contracts, the forum was hosted by Itron, but led by customers. Given the rapidly evolving marketplace, Itron provided critical updates to keep customers in the loop—including market updates, a product strategy overview, technology roadmap updates, updates on specific technolo-gies like remote firmware and network management tools, manufacturing updates, and security updates. You name it—except for whatever humorous item you just thought of—and they probably covered it.
Itron provided important updates, but ultimately the spotlight fell on utility partici-pants. And it sounds like things are changing for these utilities—fast. CenterPoint, SCE and SDG&E have full deployments under way and DTE is extending the first phase of its project to 30,000 meters. All together, these four utilities have deployed OpenWay to over 300,000 electricity and gas meters and achieved a 99 percent or greater read rate on those meters.
Let’s take a closer look at the rapid changes from one of the participants: SDG&E. The 2000 to 2001 California energy crisis—complete with peak electricity demand issues, lack of near real-time information for customers and a disconnect between wholesale and retail markets—provided the catalyst for SDG&E to change the way it does business.
Because of the energy
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crisis and utility commission actions, SDG&E turned to smart meters. The smart meters not only helped SDG&E resolve its immediate challenges, but the meters will ultimately provide the company’s foundation for a smarter grid. The company started installing meters in March 2009 and has since cranked up installation rates from 700 to 7,000 endpoints per day, and is ultimately working toward 200,000 installations by the end of 2009. When the project is complete, SDG&E have installed 1.4 million smart meters and 900,000 gas modules.
But it is not just about the meters for SDG&E. The company is looking for the meters to provide a near
real-time view into demand along with enabling demand response, net metering and other advanced capa-bilities. Ron Amundson, smart meter operations manager for SDG&E, noted that the meter will “provide the first of many sensors on an automated, aware grid. We have learned that these smart technologies are more than just buzzwords. They provide a framework for enabling better management of the grid system.”
The changes will keep coming even after the meters are installed. For example, the company will likely begin using remote connect/discon-
nect functions by the middle of next year. SDG&E also has 50 customers utilizing Google PowerMeter, a Google gadget that gives consumers their personal energy consumption information via phone or personal computer, and is looking to expand.
A last key area of change for SDG&E is business process change. “It is one thing to say that it is going to change,” said Amundson. “It is another thing when it is actually here. People will not believe it until it is in their faces.” SDG&E has realized that it is not a one-time change in business processes either. The effort is ongoing. For instance, to ensure that new meters were accurate,
the company originally planned to manually read the meters two months after installation to make sure they were accurate. However, as SDG&E sets out on these manual reads, it is finding the accuracy of the automatic meter read is better than the manual reads and that these manual reads are unnecessary. As a result, SDG&E will likely change that business process.
What happened post-forum?
So we have gotten the inside scoop on what happened during the
forum, but ultimately what did all of this information mean for utility participants? After the forum, we caught up with representatives from each utility company to get their perspectives on valuable things they learned, the importance of connecting with other utilities, new ideas they took away from the forum, and their advice for other utilities:
bob Sitkauskas, manager of »advanced metering infrastructure project, DtE Energy
Kenny Mercado, division senior »vice president, AMS deployment, CenterPoint Energy
Valuable learning
SITkAuSkAS: “Itron was definitely open with their current and future plans. It helped us to proceed with our planning going forward.”
MERcADO: “One of the most valuable things in the forum was getting up to speed with partner utili-ties in regard to their deployments. In other words, matching the pace of our progress and understanding where we are in respect to similar utilities.
“It’s also important for us to be aware of the technology advance-ment at Itron. And it’s good to have that discussion in a forum versus just a one-off situation because we all begin to understand how these advancements impact different users. In particular, it was important to me to understand Itron’s releases of new firmware and hardware so I can decide whether I need to accept those releases. Right now, what we all share is that we have this window of time where we’ll be installing a lot of hardware and firmware. We want to have the greatest opportunity to maximize the investments that we’re making. This is a critical time to make very effective decisions and very good long-term decisions.”
Connecting with other utilities
SITkAuSkAS: “With the four
“Itron was definitely open with their current and future plans. It helped us to proceed with our planning going forward.”
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utilities together, you get more insight into how things are actually working. And we are becoming more familiar with one another at each meeting. This is helpful because we can openly discuss what’s going on with our initiatives and the different advancements, enhancements and opportunities of using the OpenWay system. We’re also working to get our subject matter experts together to really understand how to operate this brand new system across different networks. Ultimately, it’s up to our own team to figure out how to do it, but the connection with other utilities is valuable.”
MERcADO: “We had enough time to discuss things at the forum, which was nice because we’re all very busy and we have our heads down within our own operations with so much going on right now. The meetings were effective and time well spent.
“Since then, we have tossed out ideas for our next meeting in terms of location and what conversations we need to carry through for the next time. Most of the subjects of our conversations are still open and evolving, so we will continue to discuss those matters as we prepare for our spring meeting.”
new ideas and takeaways
SITkAuSkAS: “Our effort is a large project, which works at the enterprise level. So, we can’t undertake this project with a small group of people. We’re going to have to involve experts in other areas of the company. Ultimately, we really learned that we have to evolve and grow our subject matter expert groups because not every person has the knowledge about everything involved with our initiative.”
MERcADO: “We’re buried in our own companies and Itron is working to stay on pace with the national and the global trends. They’re trying to manufacture for tomorrow and we’re trying to build for today. So, what we build today needs to include tomorrow. We’re
going to lean on Itron and respect their need to modernize and continue advancing their products. Itron has a level of commitment to resolve any issues with respect to the successful deployment and successful trans-formation of technology within our home environment. It’s important that Itron stays fluid, up to date and meets the latest market require-ments in terms of the capabilities of their products. We certainly under-stand why they need to make such changes.”
Suggestions for other utilities
SITkAuSkAS: “Utilities should work through prospective vendors to learn more from other users of the companies’ products. Once they do make that critical decision on a vendor, they have to become active with the other utilities to not only assist themselves going forward, but also help everyone else to move forward.”
MERcADO: “I’ve been in this utility industry for 25 years and the metering space has matured a lot, but we can’t manage this business
with just arm’s length relationships. We have to be synchronized. We have to be thinking alike. We have to be talking alike. We have to be listening, responding, addressing and managing solutions. Before utilities make a decision, they need to make sure that the company that they are choosing has the capability to not only manufacture, but to serve and support, and to build and develop for the long haul. This isn’t just a one-time decision. It’s a decision you’re making for the next 15 to 20 years—at a minimum.”
Conference presentations brought together different groups from across the utility company to demonstrate that it is not just about the meter.
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Older + wiseragingworkerswon’tleave©©
Utilitiesinthedarkby joe Kovacs
THe UTiliTy indUsTry is geTTing older. by some estimates, nearly half of today’s workforce will be eligible
for retirement in the next decade. Years of hard-won knowledge seem doomed to disappear just as utilities are implementing smart grid initiatives and benefiting from improved data collec-tion and opportunities for advanced customer communications and energy efficiency. Is this a perfect storm? Are veteran utility leaders dreaming about golf courses and easy chairs rather than smart grid technologies just when their experience is most needed? Philadelphia-based PECO Energy, which serves approximately 2 million electric and natural gas customers in southeastern Pennsylvania, and the Sacramento Municipal Utility District (SMUD) in California don’t think so.
PeCo’s PersPeCTive
Rich Cornforth, manager of investment strategy, PECO Energy, explained that industry veterans remain invested in improving utility operations. “Our veterans want to figure out what system improvements can be made by leveraging new technologies,” he said. “Smart grid capabilities challenge our strategic thinkers to investigate the products and vendors that can make us viable for years to come.”
And when these leaders
yOUNg + OlD AlikE?This section looks at workforce issues at both ends of the age spectrum and how a smarter grid can help out. joe Kovacs looks at the aging workforce side. Christine richards explores how to not just attract, but also retain younger workers. mary ann stewart wraps it up with sdg&e’s perspective on these issues.
When we’re 65
REALITYVISION STRATEGY
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retire? PECO Energy retains knowledge by documenting everything. “We record policies, procedures, design practices, lessons learned, best practices, everything we believe creates an effective, high-performance utility,” Cornforth said. “This not only allows us to capture veterans’ valuable knowledge, but also what younger workers must learn. These days, the trend is not to dedicate your career to one employer, so we ensure that what our people learn stays with us.”
Cornforth said different generations of workers can solve problems collaboratively. “The smart grid will help us under-stand customers’ consumption and help customers manage usage,” he explained. “Power consumption has increased with the number of home appliances and new technology—like keeping all of our handheld devices charged, our laptops and similar devices. Younger workers are part of this culture of using technology. With their insights into today’s consumers, they may be able to better understand behavior, and how we can promote smarter energy usage and develop a strategic smart grid vision.”
smUd’s PersPeCTive
But if, at PECO Energy, aging workers are keeping abreast of new technologies, at SMUD, the excitement surrounding smart grid is actually encouraging them to stay in the game. “Colleagues tell me they want to push back retirement to participate in creating a smarter utility future,” said Erik Krause, senior project manager for SMUD’s smart grid initiative.
In October, SMUD began deploying more than 600,000 smart meters among residential and commercial customers, including throughout Sacramento. Krause credits an extended planning phase for the chance to build relationships among stakeholders. “We don’t worry too much about an aging workforce,” he said. “Our team is diverse, and we don’t seem to be as affected by the generational trend of moving from place to place. Younger workers are learning from mentors and we feel comfortable knowing that they will make long-lasting contributions here.”
His colleague, Mike Wirsch, human resources services manager, agrees. Wirsch has been with SMUD for 17 years and has held several positions. In anticipation of a utility industry
… or 22
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jim avery, senior viCe PresidenT of Power supply for San Diego Gas & Electric (SDG&E), has a
story to tell about smart grid technology and workforce educa-tion. This pairing has really taken off at his utility and throughout the area.
“The story is really about the power industry. More will happen in our industry in the next 10 years than has happened over the past hundred years. Now we have smart grid and there’s the potential for all sorts of change—it tells us about outages, is capable of self healing and requires no human intervention,” Avery said.
SDG&E’s smart grid activities begin with its smart meter program, which started with a mass rollout in March and will see deployment to 90 percent of customers by the end of 2010 and to all 1.4 million customers by the end of 2011. The utility is also updating its systems and platforms to accommodate changes needed for a smarter grid, and has completed a stimulus funding application for an end-to-end smart grid demonstra-tion project. “Other utilities have applied for stimulus funding with a narrower focus on the individual components of smart grid,” said Avery. “Our demonstration project is different in that it will range from smart appliances all the way to genera-tion, covering the entire spectrum of smart grid.”
SDG&E has a solid track record for innovation. “We’ve gone from zero to 10 percent renewables in the past five years, and will add another 5 percent in the near future,” Avery said.
On the topic of staffing issues and smart grid, Avery said his utility is experiencing evolutionary change. “We’re finding the new generation of our staff is different. We harness their talents with an aggressive program to bring in college interns. We want to capture them early on, when they are just learning about tech-nology, by bringing them in at all stages of their undergraduate and graduate education. We offer employment to 75 percent of our interns and all of them have accepted a job when it was offered. This is extraordinary and it is happening because the students recognize this is a company willing to embrace change.”
SDG&E’s internal Operational Excellence program rolls out staff training to support the technology. “We are finding the young students to be great leaders in adopting new technology, our best and brightest. We try to empower the organization within its organizational structure. This works because we empower the staff to do their jobs, giving them a voice,” Avery said.
whEN wE’RE 65…OR 22
reCrUiTing is imPorTanT, bUT iT is noT jUsT about getting younger people into jobs. It is critical for
the utility industry to keep them in place, too. “We really need to invest in this now. We need to get them in the door, get them trained and then raise the bar technologically,” said Kalvin Davies, a director in the operations, people and change group at PricewaterhouseCoopers.
aTTraCTing yoUng PeoPle
There are certainly some characteristics of Generation Xers—generally people born in the 1960s and 1970s—and Millennials—people born in the 1980s and early 1990s—that utilities can leverage to attract them to the industry:
environmental consciousness: Generation Xers and the Millennials are generally interested in the environment and being green. Some utilities are undertaking initiatives to be green—and promoting it—from Pacific Gas and Electric to Xcel Energy. Green efforts like renewables and electric vehicles can help attract younger people to the utility industry.
Community consciousness: Generation Xers and Millennials are interested in serving their communities. “We see first responder
careers, like firemen, police and health industries getting a lift,” said Davies. “If utilities branded themselves as first responders, they could also attract more young people. For example, if the grid goes down, utilities are there to help. Essentially, you’re doing meaningful work in the utility industry.”
technology consciousness: Generation Xers and Millennials dig technology. “Utilities used to be an attractive industry in the 1970s and 1980s,” said Davies. “Now, the industry faces a technology-averse image.” In particular, it is difficult to attract Millennials because they are, according to Davies, “looking for the Facebook-enabled experience.” Smart grid, with its emphasis on new, more advanced technologies, provides an opportunity for utilities to turn their technology-averse image around.
KeePing THem online
Some utilities may do a decent job of getting younger people in the door, but how do these companies ensure it is not a catch-and-release program? Davies noted that this question is crucial as utilities face a complex regulatory structure and numerous safety issues, which can benefit from people who are in it for the long haul.
emPloymenT ConTraCTs
It is important for utilities to realize that employment contract expectations differ across generations. “Baby Boomers were really looking to find the company that they could stay with for life,” said Davies. “Generation Xers and Millennials take a whole different approach.” These generations do not expect to spend a long time in one job, which can be a problem when, for example, it takes seven years to become a journeyman lineman.
So a key question for utilities, according to Davies, is “how do we at least keep them engaged through that time period—and hopefully beyond?”
geTTing UP To sPeed
Getting employees up to speed as quickly as possible is critical and this is where retiring
workers can come into play. According to Davies, “the financial crisis has a silver lining where Baby Boomers who could have retired, couldn’t retire as quickly as they want to,” which means being available to share their experiences with younger employees and make the critical
knowledge transfer. “The financial crisis can be a good thing, if we take advantage of it,” he noted.
More than in the door
indUstryhastokeePthemtoo©©
by H. Christine richards
REALITYVISION STRATEGY
redefined by smart grid, he participates on a committee to figure out what utility jobs will exist in the future and how SMUD can prepare for them. “It is difficult to talk about the aging workforce without discussing the rest of SMUD,” he said. “We are a strong and cohesive unit.”
For PECO Energy and SMUD, an aging workforce holds few challenges for the future of smart grid. A culture of loyalty, effective planning and an ability to bring together the benefits of veterans and new workers creates a great cocktail for ensuring knowledge doesn’t disappear and utilities aren’t left in the dark.
Joe Kovacs is a freelance writer based in Colorado.
jim avery, senior viCe PresidenT of Power supply for San Diego Gas & Electric (SDG&E), has a
story to tell about smart grid technology and workforce educa-tion. This pairing has really taken off at his utility and throughout the area.
“The story is really about the power industry. More will happen in our industry in the next 10 years than has happened over the past hundred years. Now we have smart grid and there’s the potential for all sorts of change—it tells us about outages, is capable of self healing and requires no human intervention,” Avery said.
SDG&E’s smart grid activities begin with its smart meter program, which started with a mass rollout in March and will see deployment to 90 percent of customers by the end of 2010 and to all 1.4 million customers by the end of 2011. The utility is also updating its systems and platforms to accommodate changes needed for a smarter grid, and has completed a stimulus funding application for an end-to-end smart grid demonstra-tion project. “Other utilities have applied for stimulus funding with a narrower focus on the individual components of smart grid,” said Avery. “Our demonstration project is different in that it will range from smart appliances all the way to genera-tion, covering the entire spectrum of smart grid.”
SDG&E has a solid track record for innovation. “We’ve gone from zero to 10 percent renewables in the past five years, and will add another 5 percent in the near future,” Avery said.
On the topic of staffing issues and smart grid, Avery said his utility is experiencing evolutionary change. “We’re finding the new generation of our staff is different. We harness their talents with an aggressive program to bring in college interns. We want to capture them early on, when they are just learning about tech-nology, by bringing them in at all stages of their undergraduate and graduate education. We offer employment to 75 percent of our interns and all of them have accepted a job when it was offered. This is extraordinary and it is happening because the students recognize this is a company willing to embrace change.”
SDG&E’s internal Operational Excellence program rolls out staff training to support the technology. “We are finding the young students to be great leaders in adopting new technology, our best and brightest. We try to empower the organization within its organizational structure. This works because we empower the staff to do their jobs, giving them a voice,” Avery said.
New innovationsdg&ePairstech+workForce©©
by mary ann stewart
STRATEGY REALITYVISION
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ramsey Ayass (left) and Sherwin yari (right) working at a job site when they participated iin the SDg&E intern program. Ayass was hired from the program and is now an associate engineer with SDg&E.
Jim Avery g
Working with young staff is particularly helpful in the area of security. “These employees have been raised on digital technology and they are adept at finding flaws in systems and repairing them. We also partner with companies that provide military security in order to have access to their experience and state-of-the-art technology,” he said.
The pilot project developed for SDG&E’s stimulus package application includes a coalition of 25 organizations and the expected big smart grid vendors, but draws in International Brotherhood of Electrical Workers Local 465, the San Diego Workforce Partnership and CleanTECH San Diego. “Our union understands that the future of the industry is technology. They want to be part of this future and are actively involved in training in our area. They are responsive to our high growth in renewables
and our commitment to 33 percent renewable generation by 2020. The utility involves the union in our smart grid and green initiatives, and the union sees that these changes will create lots of jobs,” Avery said.
San Diego is rich in technology, which helps with staffing issues, and the utility has been able to demonstrate that employing new technology benefits its customers. San Diego has been rated as having the most reliable power in the West.
SDG&E is also involved in the expansion of electric vehicle technology. “Electric cars will be adopted rapidly and we are preparing for this surge. If customers plug their cars into their house power, we could see a 50 to 75 percent increase in residen-tial usage. We are developing new technologies so customers can
charge their cars at the mall or at home or anywhere else and have those charges all appear on one electric bill. We also see an opportunity to manage loads on charging stations and integrate them with fluctuating supply from renewables,” he said.
The San Diego Workforce Partnership and CleanTECH San Diego are part of the coalition included in SDG&E’s stimulus proposal. The Partnership will aim its constituencies toward the next generation of smart grid and clean technology jobs, and identify technology needs and proceed immediately to training to fill those needs. CleanTECH will provide outreach
to enable new products, services and markets to fuel the local economy. The stimulus proposal team also includes three local universities, which want to use the pilot project to provide real-world experience to their students as well as new training opportunities.
San Diego has some of the lowest residential energy usage of any customer base in the nation. One of the area’s biggest technology growth sectors is solar power. The labor unions are training electricians in solar installations. “Our goal is to sow the seeds for renewable technology to germinate,” Avery said.
Mary Ann Stewart is a journalist, engineer and researcher focusing on the utility industry.
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©thought leaderShip ©SponSored by WauSau Financial SyStemS
65% of utility companies interviewed said the current economic trends/issues are affecting the industry and are making processing customer payments more difficult.
Economy Impacts Payments
There is little question that the utility industry is in the midst of some of the most challenging and opportunistic times in its 100+ year existence. On the one hand, we see utilities struggle with the business impacts that higher unemployment and lower demand bring in the current “Great Recession” and, on the
other hand, we see strong regulatory pressure for investments in things like green power, smart grid techno-logies and more customer-friendly approaches to doing business. Utilities are naturally squeezed between the need to maintain proper business discipline that difficult economic times require and simultaneously making investments in technologies that will fundamentally change how they do business. These are difficult
challenges and the utilities that successfully manage through these times will emerge stronger and better positioned to meet the evolving needs of their stakeholders.
Surviving through difficult times to eventually thrive in good economic times, organizations must first focus on the basics. And there is
nothing more basic than cash flow. Like other businesses, utilities are forced to examine their cash collection processes during difficult times to ensure that they are properly collec-ting payments and ensuring them-selves that their business processes support good cash management practices. Indeed, without proper cash management practices, utilities will find it more difficult than necessary to invest in green technologies, smart grid and initiatives to improve the customer experience.
The current economic conditions, as well as the issues facing the utility industry, are impacting how and when utilities receive payment. A recent survey conducted by Sierra Energy Group, the research and analysis division of Energy Central, indicated that 65% of all utilities reported that
current trends/issues affecting the utility industry have made payment issues more difficult. Additional research has also indicated that 10% of more of their payments take more than 3 days to process and that delinquencies are up by 20% over prior
Improving Payment Processing During Difficult Economic Times:
Harvesting the Low Hanging Fruit
Difficult economic times allow opportunistic and forward- thinking organizations to become better. Good organizations recognize that they must seize opportunities to get better, particularly during difficult econo-mic times. Such efforts pay significant dividends in the form of more efficient business processes, improved customer service and better overall financial performance.
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©thought leaderShip ©SponSored by WauSau Financial SyStemS
Shift to Electronic and Plastic
years. Reviewing these survey results, it is easy to see that the “basic” effort of managing cash flow has become much more difficult for utilities.
In addition to the need to increase cash flow during challenging economic times, utilities are expe-riencing changing demands from customers related to how they want to make payments. Customers lead hectic lives and expect that utilities can receive payments in a manner that is convenient for them, not for the utility. The old days of everyone paying by check have long since passed, and customers are expecting utilities to catch up to the rest of the business world and accept payments in multiple forms and on a 24/7 basis. In short, customers expect that utilities will change their long-standing business practices and adapt to the customer’s needs.
Responding to changing customer preferences is something utilities have done reasonably well through the years, though they have sometimes moved more slowly than some would prefer. Examples include implemen-tation of 24-hour call lines, one-call locating and online scheduling to name but a few. The implementation
of new payment methods is likely to follow the same pattern as utilities seek to more closely align themselves with customer preferences. Indeed, as demonstrated in the accompanying charts, the last few years have seen a dramatic increase in the amount of payments received by various electronic means and a corresponding reduction in the amount of payments processed by checks.
Beyond that, though, utilities are seeing an impact from the rapid emer-gence of other customer preferences, including customers wishing to make payment by cell phone or some other mobile device. Some utilities have been proactive in supporting those preferences, but many utilities have yet to fully align themselves with evolving customer preferences.
To be sure, there are many barriers utilities face in making modifications to their payment processing methods and business practices. Foremost among them are the limitations of existing systems and processes. Additional research revealed that 85% of utilities run legacy payment IT systems, which respondents indicated as a major concern in making accu-rate, daily business decisions. It was
further identified that 33% of work performed was unnecessary waste. Case studies have revealed that the unnecessary waste was primarily focused in the following areas:
Lack of automated tracking and �monitoring, Labor intensive exception proces- �sing, Delays in processing payments �from remote sites, daily carry-over and limited system metrics to monitor performance.
Old technology combined with inefficient processes reduce the ability for the utility to be responsive and proactive with its consumers. Forced to play catch-up as consumer demands evolve, this then requires even more pressure on IT staffs and systems to meet the new challenge.
There are four fundamental components to proper remittance processes and most legacy IT systems struggle with all of them. The four components are:
Payment Acceptance, which �represents the various ways that utilities can accept payments
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©thought leaderShip ©SponSored by WauSau Financial SyStemS
Payment Channels
Checks continue to dominate payment typesaccepted by utilities, mobile payments are emerging.
Transaction Aggregation is the �manner in which payments from various sources are consolidated Posting/Clearing is the process by �which the consolidated payments are posted to defined accounts and then later clearedReporting/Integration describes �how information about the payments is integrated with other systems and reported throughout the enterprise and to third parties.
Depending on the age and design of a legacy system, a failure to perform on one component could have a ripple effect throughout the four components. For example, consider a legacy system that does not accept payments through online credit card submissions. If the legacy system does not support that, the utility can refuse to accept payments online with a credit card, which is not customer friendly, or they can build manual processes around that payment type. If manual processes are developed, they must follow those transactions through the other components of the remittance processing cycle. As the volume grows, it becomes more
difficult and expensive to sustain and results in significant business process waste, as well as delayed deposits. In a business environment that values good cash management processes and customer-friendly approaches, manual work-arounds in processing cash are unwarranted and unnecessary.
The astute utility determined to capture opportunities inherent to down economic cycles will view
legacy systems and 33% unneces-sary waste as a real and meaningful opportunity to not only capture savings inherent to the improvement of the technology and related busi-ness processes, but also, and more importantly, capture the large upside inherent to improved cash manage-ment practices. In short, these are remarkable findings and executives who thrive on harvesting low-hanging fruit will find ample opportunity to reap large bounties of savings, efficiencies and simultaneously
achieve measureable improvements to cash flow.
Harvesting that low-hanging fruit will require an analysis of each of the four primary components of remit-tance processing and the implemen-tation of systems and processes that support them. WAUSAU Financial Systems, a prominent and well-respected solution provider in this market space, has just such a system
and has helped 45 different utility companies maximize their remit-tance processing processes. Indeed, WAUSAU’s “UtiliWorks™” provides utilities with an integrated solution that addresses payment acceptance, transaction aggregation, posting/clearing and reporting integration. It is an integrated end-to-end solution that meets the evolving needs of utilities and their customers and helps ensure timely deposits of cash.
Utility companies that have imple-mented UtiliWorks™, and its earlier
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©thought leaderShip ©SponSored by WauSau Financial SyStemS
Pay Through Any Channel:Paper, Plastic or El t i
Into One Receivables Hubthat Aggregates T ti
Integrated Receivables andInsights
ConsolidatedOutputs and Intelligent Cl i
1 2 3 4
ACH
CHECK
El ec tron ic T ransac tions Cl ear ing Consolidated A/RA/R Exceptions Reconciliation
CHECK
CASH
MOBILETransaction Aggregation
Output
ExportsExtracts
Payment AnalyticsReceivables Hub
PHONE
WEB
AggregationException HandlingReturns Processing
PostingClearing
System Interfaces to
WALK-IN
Banks & CorporationsCollections
Flexible Delivery: On-premise, Outsourced or Co-sourcedfor Financial Institutions and Corporate Clients
The UtiliWorksTM Solution
versions, have reported significant process improvements and increases in investable dollars. American Electric Power, for example, was able to reduce its staff by over 40, including FTEs and PTEs. Similarly, PSE&G reported labor reductions of 1 FTE and 10 PTEs, 100% of processing completed in the same day and, remarkably, an $8.4 M average increase in daily investable dollars! Commenting on their selection of WAUSAU Financial System as their vendor partner, Patrick Naples, District Manager of Customer Operations for PSE&G, stated, “We were looking for a solution that would offer streamlined processes, faster funds availability, improved banking feeds, improved accessibility to check and coupon images and customer correspondence.” With such dramatic results, it is little wonder that PSE&G reported that the results achieved exceeded their business case expectations. Also
noteworthy is that customers report achieving a return on investment (ROI) in 18 months or less, which is well beyond most investment thresholds for utilities.
While utilities may feel squeezed by today’s economic conditions and the corresponding calls to invest in green energy and smart grid technologies, they must also recognize that great opportunities exist to make prudent investments and refinements to their businesses. By making such investments and improvements, they will decrease their operating expenses, increase their investable cash, improve relationships with customers and, of course, strengthen their overall financial position. These are precisely the kind of opportunities that good businesses seize during difficult economic times. It is time for utilities to harvest the low-hanging fruit.
Mike Tallitsch, VP Corporate Solutions – Utilities, WAUSAU Financial Systems, [email protected]. For more information, visit www.utilityreceivables.com.
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g r i d (U n) lo c k
the largest portfolio of renewable generation resources in the United States. And this November, it started to roll out a Web portal for its generation portfolio for enhanced communication of availability and dispatch.
The company is a large user of renewable energy, with 12.6 billion kWh of renewable energy sold last year. In terms of the installed capacity, SCE has 1,137 MW of wind generation, 906 MW of geothermal and 356 MW of solar. It also acquires energy from hydropower and biomass generation. Geothermal is more of a baseload asset, depending on the production of the wells and any maintenance issues that could be faced, as is the case in any other power plant. In fact, it produces about 62 percent of SCE’s total renew-able generation.
SCE says it will meet its 20 percent goal. The company will even be importing 2 billion kWh of wind energy from Puget Sound Energy in Washington state over the next two years. And likewise, it’s got more experience in integrating renewable energy into its system.
It is using digital technologies on its own and in conjunction with the vendors it employs for its site monitoring.
For assets like those inside and outside of California to be fully inte-grated into the system, site monitoring is crucial. That’s where the meteoro-logical towers come into play. “We’re
moving into an area where we think the technical advances of
forecasting and managing that data are improving,” Pespisa
said. “We are able to share data that is more
accurate in gener-ating forecasts for forward markets.” Along with its two forecasting vendors,
this reporting system allows it to build a data
bank for both wind and solar as their percentages grow.
in His days as a ConTrol room oPeraTor more THan a deCade ago, joHn Pespisa remembers working intermittent renewable energy resources like
wind into the system. The footprint may have been small, but the resource had to be dispatched. “Sometimes at 3 a.m., you’d wonder where the wind went,” he said.
No longer. With more advanced forecasting tools and improved monitoring of generation sites and communication with grid operators, controllers are better able to anticipate the fluctuations of what were once a few MWs of generation. Now, with renewables measured in the hundreds of MWs, better tools are available. And even more important than that, ambitious goals to incorporate renewable energy into California’s resource mix have put added pressure on utilities to get it right. Instead of a goal to get wind, solar and geothermal power into the system, it’s a mandate. Accurate forecasts and dispatch are imperative.
Nowhere is this more acute than in California, and specifically, at Southern California Edison (SCE), where Pespisa is manager of real-time operations. He spent 13 of his 23 years at the utility in control rooms. That was before the creation of the California Independent System Operator (CAISO), so he’s seen the evolution.
California has the most aggressive renewable energy portfolio standard in the country—by far. An executive order signed by Governor Arnold Schwarzenegger in September requires 33 percent of the state’s energy to come from renewable resources by 2020. In the meantime, the state’s investor-owned utilities are mandated to procure 20 percent of their electricity from renewable resources by 2012. Utilities are scrambling to acquire generation assets, either from their own plants or through power purchasing agreements, and are sometimes looking beyond the state’s borders to find it.
SCE is well on its way, and closer than many, with 16 percent of its electricity from renewables. Its footprint is from Orange and San Bernardino counties in the south, stretching to Arizona in the east and moving north along the Nevada border. With nearly 2,800 MW of wind, solar and geothermal and other generation assets, SCE controls
Minding the storescedigitallyintegratesrenewaBles©©
by william opalka
STRATEGY REALITYVISION
ONgOiNg TiMiNgThese articles explore various grid timing issues. william opalka and dennis Keim explore the timing and dispatch of renewables on the grid. Kate rowland explores timing in terms of transmission versus customers—where should utilities focus first?
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thomas hAlva Edison is seated at the wheel of his first electric truck. (AP Photo)
cell plant operations—the largest or most impactful assets first and then cascading down through the smaller and less important ones later—until all generation over 10 asset classes is connected to the ISO. Real-time availability is thus communicated.
A telemetry regime is also being rolled out with SCE and the ISO implementing technical requirements and standards for generating units and load participants. This effort is to establish and maintain a data processing gateway between the plants and CAISO’s energy management system. This telemetry offers a gateway into the network of generation plants and transmission and distribution networks. “This is better at data collection and it’s timelier in its reporting,” Pespisa said. For dispatching generation assets, especially renewables, it is important to understand not just what a site is producing at a given moment, but that the amount produced by a renewable resource at a given moment matches the capacity expected.
William Opalka is editor-in-chief of renewablesBizdaily.
But the forecasting vendors are moving closer to refining the hourly forecasts so that there is more confidence built into the models that influence generation dispatch and utility bids that set power prices.
A second area is sharing the available information from the generation site. “Wind or solar is only as good as the capacity to determine the availability of each site,” Pespisa said. For that, the utility uses a direct supervisory control and data acquisi-tion (SCADA) system with each plant connected to the control area and the integration more automated through a series of nodes. That creates both operational challenges and cost issues.
For example, a single power plant, or perhaps a large solar array, might have its own SCADA system reporting its generating capacity and output to the independent system operator (ISO). But if there are perhaps hundreds of rooftop sites in a relatively small area all reporting similar data to the same central monitoring site, there are potentially thousands of pieces of data being generated. As commercial and industrial locations become part of the rooftop solar programs, there are also potentially thousands of sites instead of a few data collection sites. In solar integra-tion, SCE announced this summer that its rooftop program for commercial sites will generate 500 MW. It is developing a pilot program to relay transmission data from each site to the ISO.
The potential is not only duplication of the information generated, but also the real possibility of creating unneces-sary costs. CAISO is developing a model to provide for both information and cost sharing. State regulators are developing plans to address the cost-sharing issue.
Another effort this November was the unveiling of a Web portal, part of the program to deploy digital technology through telemetry to monitor plant availability and production and even assist in outage management. The rollout is taking place over three months to all
foUr relays. THose were THe Key ComPonenTs THaT allowed a Delco-Light plant to automatically maintain a battery set to provide basic
electrical service to more than 100,000 farms in 1920. Add a wind electric plant and save on fuel and wear and tear while maintaining reliable power. In the early 1910s, Thomas Edison investigated the use of windmills to charge his improved storage batteries for applications such as the then still popular electric car market.
Back to the futurerenewaBlesarereallynothingnew©©
by dennis Keim
REALITYVISION STRATEGY
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iT’s as old a debaTe as THe CHiCKen and THe egg, and as ComPliCaTed as the Gordian knot. Should utilities tackle transmission or customers
first when making investments in a smarter grid?On the one hand, it’s imperative—and mandated in several states in their renew-
able energy portfolios—to ensure new renewable generation can be added to the grid and transported to urban centers, often long distances away, where it can be used.
On the other hand, the federal money, and the more visible push, is on the other end of the equation: smart meters and demand response scenarios involving
With the dawning of today’s smart grid and its focus on automatic interac-tive control and integrating distributed generation, including renewable energy systems, we are seeing a gradual return to these largely forgotten localized autonomous systems. This time they are being developed with the added reliability, support and market benefit of a smart utility grid.
Ideally, the use of smart grid tech-nologies allows the small business owner or homeowner, in coordination with their utility, to optimize their renewable energy investment. The goal is to provide any excess power to the grid at peak pricing periods and to directly utilize the energy produced during lower-cost nonpeak periods.
A key feature of great importance to small renewable installations, and supported by smart metering, is time-of-use (TOU) metering. Use of TOU rates by solar power consumers have significantly improved the economics of photovoltaic systems in locations where the solar peak production closely matches the utility’s daily peak demand. Wind is often a nonpeak source of energy, and the adoption of TOU metering encourages the consumer to schedule loads when the wind is blowing rather than feeding excess power to the grid.
Tangled networktransmissionormeterinvestments?©©
by Kate rowland
STRATEGYVISION REALITY
In the future, a local storage system may be used to absorb off-peak renewable power. Not unlike what Edison once envisioned, that storage role may be taken by charging electric vehicles, plug-in hybrids and vehicle-to-grid (V2G) plug-in hybrids. V2G systems are being designed to allow for two-way power and information flow from the vehicle to the grid. Smart grid technologies will be critical to a successful implementation of electric vehicles, of any type, on a large scale.
With V2G technology linked to renewable charging systems, autonomous and automatic micro-islands of power supply, not unlike the Delco-Light and wind-electric systems of bygone years, become a possibility. Should the utility supply ever fail, the home or business would be able, in theory, to use the generator and battery of the hybrid along with any available renewables to provide power for emergency needs.
On the utility scale, Denmark has been in the forefront of wind energy technology and its implementation for many years. In 2007, wind energy provided almost 20 percent of Denmark’s domestic electrical energy supply. Unfortunately, during low demand and high wind supply periods, they often have to export their extra wind energy.
To better utilize this resource, Denmark has started the EDISON project. EDISON stands for Electric vehicles in a Distributed and Integrated market using Sustainable energy and Open Networks. This research consortium includes IBM and Siemens along with other notable international and Danish organizations.
The idea behind EDISON is to take Denmark’s excess wind energy and charge electric vehicles. They will do this by implementing smart grid technolo-gies to balance the wind supply, transmission capability and vehicle charging demands and also to handle the billing. Thus, rather than exporting excess wind energy, they will be able to capture it for local high-value and low-carbon transportation. This will also allow for future expansion of their already formidable wind power base.
It’s clear that the combination of renewable energy and smart grid technologies has a very promising future. The development of an increasingly dynamic IT-based supply and demand management system will continue to enhance the utility of renewable energy, not only for the utility, but also for the consumer-producer.
Dennis Keim is a freelance writer based in Nebraska.
the end-use customer are getting a lot of play these days. If utilities can get their customers to use less, then not as much new generation will be imme-diately necessary. And, while that may decrease revenues to the utility, it may still be in a better financial position by not having to build new generation.
It’s a tangled knot, indeed.And then there’s the question of
available federal stimulus funding. The matching grant money is focused mainly on smart meter projects, though there has been $750 million in federal loan guarantees for trans-mission made available through the stimulus legislation.
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But even that is a tangled web, if a recent decision by the Public Utilities Commission of Texas (PUCT) is any indication. In August, PUCT agreed with utilities building the state’s $5 billion renewable energy transmis-sion network that the “Buy American” provisions of the funding, as well as the mandated construction start of no later than September 30, 2011, made the loan guarantees less appealing, and could increase project costs. As well, all projects receiving such federal funding are required to undergo a major environmental review, making that September 2011 start date pretty unlikely to begin with.
Further, there is a federal funding stipulation, utility executives pointed out, that requires firms to pay a “prevailing wage” in line with what laborers make for similar jobs within the county in which construction is taking place. As the Texas transmission
plan spans several counties, this restriction could raise labor costs, and make payroll accounting far more complicated.
“We believe the long-term benefits of getting the project in on time and delivering clean, renewable energy to the market and relieving congestion outweighs the benefits that we might receive from loan guarantees,” Oncor spokes-woman Carol Peters told the Dallas Morning News after the PUCT’s decision.
“The transmission process doesn’t need stimulus funding, federal support—it needs federal legisla-tion,” Michael Morris, American Electric Power’s chairman, president and CEO told participants in an Energy Central webcast on renewables and the smart grid in late September. Siting permissions and the need for a “fair and just and reasonable way of allocating the cost of building these lines” is also necessary, added Monty Humble, vice president and general counsel, Mesa Power Group LLC.
Across the Canadian border in Alberta, the Alberta Electric System Operator (AESO) has been grappling with some of those sticky wickets for years. This spring, it got a little help from the provincial government, which introduced its controversial amendments to Bill 50. The bill argues that transmission falls under the category of critical infrastructure, like hospitals and highways. Under the changes proposed, the bill would enable AESO to take transmission needs
“the�transmission�
process�doesn’t�
need�stimulus�
funding,�federal�
support—it�needs�
federal�legislation.”
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becomes more one of chicken AND egg. Both ends of the equation—transmission and customer—must be pursued vigorously in terms of utility investment.
And it’s obvious, through the sheer number of utility applications for Smart Grid Investment Grant (SGIG) and Smart Grid Demonstration Grant funding made public after August’s application deadlines, that utilities are looking at investment in the customer side of the equation, as well.
Scores of utilities who made their funding applications public requested SGIG matching funding for smart grid projects, many targeted at the consumer end of the delivery chain. NV Energy, for instance, requested $138 million in funding to support its advanced service delivery project, designed to inte-grate customers and the utility through advanced technologies, enabling customers to take ownership of their energy usage. ComEd, too, applied for $175 million in matching funds, in part to deploy additional smart meters throughout its service territory.
Southern Company, on the other hand, is looking at both sides of the equation in its SGIG applications: the company requested $197 million for its advanced metering initiative, while also applying for $165
million to increase automation of its electric transmission and distribution infrastructure.
So, it’s not an easy answer, no matter which side of the equation each utility chooses to tackle first. But it’s one that’s eliciting a lot of discussion. And on that point, everyone’s on the same side: they’re all “talkin’ about an evolution.”
Kate Rowland is managing editor of intelligentUtility magazine.
applications to the provincial Cabinet for approval, alleviating the requirement, in specific cases, for public hearings on those particular needs applications.
“The intent is to expedite that which AESO needs to have expedited,” explained Evan Bahry, executive director of the Independent Power Producers Society of Alberta (IPPSA). IPPSA believes that a robust transmission grid creates flexibility to accommodate whatever fuel technologies may prove economical at any given time, and to ensure that the output of those technologies can flow across the province to meet demand. Further, there has been an argument proffered by ENMAX Corp., an electric utility owned by the City of Calgary, that building the new transmission is opportunistic, rather than critical, as the amount of power flowing over the existing transmission lines has fallen back to 2005 levels. IPPSA, on the other hand, argues that new transmission facilities are needed to serve the province through the next few decades, as the economy and power needs evolve.
Paul D. McCoy, president and chief operating officer of Trans-Elect Development Company, LLC, and the newly elected president of transmission industry coalition WIRES, says the coalition views the fundamental problem facing new transmission projects as one of solving the issue of cost allocation. “We’re encouraged, because we’re seeing people trying to grapple with this,” he said. “But the progress is slow, and it tends to be quite regional in nature. Each regional transmission organization (RTO)/indepen-dent system operator (ISO) is trying to grapple with it” within its own jurisdiction.
McCoy points to Texas, again, as an example of a realistic and practical approach to the issue. In that state, which, like Alberta, has the benefit of a single-state jurisdiction, the RTO has made the decision to build transmission to allow renewables to develop. Texas’ approach, to build transmission in advance of the wind projects, and to build to the best wind areas, requires advance financial commitment of the wind genera-tors intending to build in those areas.
“The state is being, in my view, pragmatic, and has parsed that $5 billion plan into digestible pieces,” McCoy said. And other RTOs are moving in a similar, shared-cost direction with their transmission plans, he said, citing examples such as the Upper Midwest Transmission Development Initiative, a regional transmis-sion planning effort launched in September 2008 by the states of Minnesota, Iowa, Wisconsin, North Dakota and South Dakota to promote investment and cost sharing among the states.
But because transmission planning “occurs in dog years relative to genera-tion,” according to Mesa Power’s Humble, the chicken-or-egg argument truly
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Needed: A healthy dose of reality
U tilities, regulators, consu-mers and others have been bombarded by hype around
the smart grid, to the point that there may be danger of some people growing weary of it. Five years ago, the smart grid term hadn’t been invented and utilities were concentra-ting on delivering power in the most
cost-effective and efficient manner possible. The U.S. electric grid actually has been pretty smart for generations. It has continued to grow smarter with the introduction of SCADA (supervi-sory control and data acquisition), DA (distribution automation), and AMR (automatic meter reading), which now has evolved to AMI (advanced metering infrastructure).
The industry now has gone through two or three years of many
people from many perspectives attempting to define exactly what smart grid means. There are almost as many definitions as there are definers. “Itron believes utilities, regulators, consumers and others are tired of the excessive hype around smart grid. It’s time to step up and demand that everyone talk about the smart grid with a healthy dose of reality,” says Philip Mezey, chief operating officer at Itron.
We’re only at the beginning. The smart grid will evolve
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©thought leaderShip ©SponSored by itron
“Itron is committed to talking about our place in smart grid and our plans are informed by decades of the most innovative work in the industry,” Mezey says. “Itron was a pioneer in AMR and other technologies and we’ve never had a failed implementa-tion in 30 years.”
All of these technologies continue to develop and evolve, even more rapidly in the current environment. However, in the United States alone, it is estimated that $880 billion will be spent by utilities on metering, communications and distribution and transmission improvements during the next 20 years. A smarter grid is not something that will be done over-night, nor are the business cases for much of this investment always easy to make. “At Itron, we believe the core vision of smart grid and related terms must be customer value,” Mezey adds.
Who are customers who need value?
Itron takes a holistic view of “custo-mers,” including our customers—utilities that are struggling to deal with the new demands being placed upon them by legislation and regu-lation—as well as utilities’ end-use customers: the businesses and families that depend upon safe, reliable, inexpensive electricity to maintain their businesses and their lifestyles.
The smart grid is about more than just communications, technology and energy systems. It is about a cultural transformation for the utility industry and consumers of energy.
Itron supports the development of open standards and is working with its customers and broad industry groups to develop these standards. To ensure customer confidentiality and security, however, those standards
must be secure. There has been a lot of hype about use of IP (Internet protocol) throughout the smart grid. The problem is that there are security questions around the widespread use of IP. IP has an important place in smart grid communications, but by itself, it is not secure enough to protect our energy.
Security concerns go way beyond IP and Itron is engaging with partners and industry groups in dialogue on how to use the efficiency of IP in communications, but also ensure the required security on networks and devices vital to customers needs. Itron is involved in the IP conversations that the industry is currently having and expects to continue to engage with energy leaders in this dialogue.
Itron also is working with AT&T, Verizon, Sprint and other commu-nications players to help determine how the smart grid may be “future proofed” against intrusion and obsole-scence to protect end-use customers.
Over the past three years, Itron has worked with utility partners on some of the most complex and thorough AMI and smart grid implementations. Itron has tested necessary security measures, learned from those tests, and tested again. This knowledge has led Itron to striking insights and innovations around security. It’s time for real dialogue about how to secure everyone’s energy future.
Is it too obvious a thought that we need to protect the world’s energy and water supply? Evidently not. It’s time to get real about the level of security needed to secure our energy infrastruc-ture, Itron believes. We’ve all seen what happens when a person’s identity is stolen, when hackers access credit card databases, or when a pension system is compromised. We can’t take similar risk with our energy supply. Period.
“The industry has moved very quickly from AMI to smart grid,” Mezey observes. “How does smart metering related to smart grid? Obviously the smart grid puts a lot of emphasis on communications. We’re going to have to get this right. All of our customers expect no less. We need published protocols and standards so everyone can be on the same page.”
Hardware, software and standards must work together. Clunky, “patch-work quilt” solutions will fail. Since Itron has been working in these areas for decades, we’ve seen firsthand what happens when incompatible hardware, software and communica-tions are shoved together. It doesn’t work and we can’t afford to make this mistake. The stakes for the smart grid are too high. We need solutions that work in concert to deliver reliable energy and the lowest possible cost for the greatest benefit for customers.
Helping to inject a dose of reality
In attempting to move the discussion forward, toward a more cogent and holistic vision of the smart grid, Itron has published a booklet entitled 10 Things Itron knows to be true about Smart Grid. Those ten things, some of which already have been discussed in this paper, include:
The smart grid requires a different 1.
way of doing business
We’re only at the beginning. The 2.
smart grid will evolve.
smart grid security is being 3.
underestimated
The smart grid must be relevant to 4.
utilities of all sizes
Advanced metering is the 5.
cornerstone technology of the
smart grid
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There needs to be a vision of the 6.
smart grid. There also needs to
be reality about how we will get
there.
Open standards must allow for 7.
interoperability and innovation.
The smart grid delivers data and 8.
information that will be used in
surprising ways
Hardware, software and standards 9.
must work together. Clunky,
“patchwork quilt” solutions will
fail.
Developing the smart grid 10.
will require unprecedented
collaboration.
The “unprecedented collaboration” piece is particularly important. If there is one thing 30 years of experience driving innovation for utilities has taught us, it’s that our complex indu-stry is bigger than any one company. We have to work together. The smart grid is one of the world’s biggest priorities. It will secure our energy future, ensure reliable energy delivery at the lowest possible cost, and lead to an entirely new economy. But it also represents an enormous challenge. Realizing the promise of the smart grid will require the best thinkers with the most direct experience
working together. The importance of collaboration to develop the smart grid can’t be overstated. Itron stands ready, willing and able to engage in that collaboration.
Too many discussions about the smart grid are being framed with only the world’s largest utilities in mind. The key players, of course, have a big stake in the grid’s future, but all utilities need to be able to access the grid and use it in ways that meet their unique objectives.
We understand that there are common challenges all utilities face. We also understand that smaller
utilities—like those owned by municipalities or co-ops—need smart grid benefits for themselves and their customers. This point hasn’t been discussed enough, but if we don’t meet all utilities’ needs, the smart grid won’t succeed. The customers are not just the big guys, but the entire industry.
Advanced metering is the technology around which the smart grid is built. Why? It acts as the
smart grid’s nervous system, flowing with information and commands. Also, because it becomes the framework for a multi-application network, and most importantly, because it is here today. The techno-logy is available and proven, and can be put in place now to create the base for the evolving grid.
Over the past few years, Itron’s focus has been expanding advanced metering to the smart grid. The secu-rity, interoperability, standards and range of networks we’ve refined have been proven with the world’s most rigorous smart grid implementations.
Itron is fully committed to the smart grid. The company has developed many of the technologies that will make it possible and we continue to enhance and improve those technologies. In cooperation with federal, state and local gover-nmental officials, we will continue to work toward development of a smarter grid to the benefit of all. There are two things, however, that we view as still lacking: a shared vision, one that includes all stakeholders, and a healthy dose of reality.
The smart grid is creating new ways to understand energy use and behaviors. With this comes the development of new roles—from the utility executive to the end-use customer. But what does this all mean? It means we have moved from a one-way process to a two-way conversation. No longer will utilities send out energy and then collect data back to be used solely for issuing a bill. The smart grid allows us to deliver not just energy, but also pricing information, load data, and knowledge to help consumers make smart, informed decisions. Utilities will gather not only billing informa-tion, but also data about patterns of use, customer preferences, and much more. The information and data being delivered today are moving the needle toward changing behavior and ultimately shifting the way we think about and use energy. Is this a surprise to anyone? Maybe, maybe not, but it certainly is game-changing.
The “how” of this transformation of our electrical distribution system is overwhelming. Gathering and integra-ting real-time information about renewable, generation, transmission, consumer use and more goes beyond any challenge the industry ever has had to face. We can get there, and
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Itron is doing its part. But there still is a long way to go. Building the smart grid may take a lifetime. Aspects of it are here today and it is developing rapidly. To be successful, we need a smart grid infrastructure designed to evolve and interoperate and a vision that is embraced by everyone.
The reality is that in the coming years, communications technology will change. Networking architecture will change. Distributed generation will change. How we integrate renewable energy will change. Many of the technologies that will run on the smart grid haven’t even
been invented. We need a system—a central nervous system of the smart grid—that provides the foundation for innovation, interoperability and flexibility. Itron is committed to helping develop that central nervous system and will continue to work with others to make it a long-term reality. But there needs to be some realistic assessments of where we’re going and
how we get everyone on board.Itron encourages dialogue and
collaboration as we move forward to deal with many of the challenges surrounding the smart grid. Only by working together can we accomplish the vision that, while still somewhat blurry now, will become more clear, day by day. That vision is of a 21st century electric generation and distribution system that will meet the needs of future generations just as the existing one has done in the past.
“The new vision must focus on the environment and energy efficiency,” Mezey says. “That gets to the carbon
issue and focuses on creating customer value.” However, Itron also believes the new vision must continue to embrace the fundamentals of sound economics, responsible customer relationship and rational public policy. Those are the areas that still need considerable work and Itron is committed to helping utilities work toward these goals.
Utilities currently are being bombarded from all angles by shifting public policy and special-interest demands. Yet, it is the utilities that ultimately must be responsive to their customers and utilities who must find ways to fund the massive remaking of the industry that is being envisioned. Having worked with utilities throug-hout its history, Itron has a particular affinity for the industry and the people who work there and the executives who lead them. Utilities are responsible for keeping the lights on and Itron will continue to work with them to help chart a course through what is essentially unknown and currently disturbed and tumultuous seas. While much of the hype and the reality envi-sions an era of less-available electricity, Itron believes utilities can continue to deliver customer value in the evolving new environment and is dedicated to helping them do so, just as we have been for the past 30 years. Itron brings not just advanced technology, but also willing collaboration on yet-unresolved issues to the table.
Difficult times call for collaborative, smart decision-making, as well as smarter grids. Itron, as always, stands ready to work with others, especially utilities, toward reality-based decision-making.
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as THe smarT grid Train CHUgs oUT of THe sTaTion, iT’s liTTle wonder that renters nationwide fear being left behind on the platform—empty-
handed.Yes, their fancy digital meters and accompanying newfangled gadgets will
be the same as those installed at single-family homes. But with shared roofs and nonexistent backyards, how will residents of multi-family housing reasonably access renewable energy? And, what about energy efficiency? If landlords aren’t footing those gigantic utility bills, why should they care if their tenants have the most up-to-date appliances, lighting and heating/cooling systems?
Enter SMUD. That’s the less-than-flattering acronym for one of the nation’s more forward-thinking energy sellers, the Sacramento Municipal Utility District. Long a leader in solar options and energy efficiency, the California utility will be installing smart meters between late this year and spring 2011.
it has a smart appliance laboratory to demonstrate and train consumers and partnering companies, including architects and builders. The company also shows products at several national and international venues such as the International Builders Show.
Louisville Gas and Electric (LG&E) is working with GE on a smart appliance field study. Fifteen homes were outfitted with smart appliances. Homeowners participate in focus groups so LG&E and GE can gather real-world informa-tion on usage and performance. “In general, feedback from our focus groups has been favorable and we learned a few things we did wrong. We know we have a good product when the consumer does not notice any change in his or her life. If it’s saving energy and you don’t know it’s doing it you have a good
product,” Beyerle added. Millions of smart meters have been
installed in California and more are being installed in other states every day. Architects, builders and retailers need to get up to speed on this new technology wave to smoothly ride into coming market demand.
Mike Breslin is a freelance writer and novelist based in New Jersey.
“wHaT’s in iT for me?” will be THe qUesTion ConsUmers asK wHen it comes to buying smart appliances. As these items trickle into the
marketplace, answers will have to come from informed people at utilities, appliance manufacturers, retailers, home builders and remodeling contractors. No doubt government will play a large role in public education to support national energy conservation goals.
But the conversation cannot begin until there are smart meters to commu-nicate with the appliances. To succeed, smart appliances will need attractive time-of-use rates, or the promise of lower prices, otherwise there will be no incentive to pay a premium price. “It will cost more than our standard EnergyStar product, approximately 10 percent more,” said Mike Beyerle, marketing manager for innovation in GE’s consumer and industrial division.
Michael A. Smith, vice president of product standards at Toll Brothers, one of America’s largest home builders, buys $20 million of appliances annually. He sees a higher price for the consumer, “probably a premium of 20 to 25 percent extra when you actually have an installed cost.” Developers and builders offer standard appliance packages that relate to the housing’s price point. There are usually upgrades available, but smart appliances require special ordering and coordination with the manufacturer and utility to ensure that the demand response module, the wireless transceiver assigned to the appliance, is compatible with the meter, be it ZigBee, power line carrier, Wi-Fi or another.
“The only place we are starting to get a few requests is out West where most high technology starts. How quickly it spreads across the country remains to be seen. For the immediate future we are not considering offering smart appliances as a standard option. If we see a surge in demand, we will do it,” said Smith.
GE’s consumer and industrial appliance division is based in Louisville, Ky. There,
Appliance influencetransFormingBUilderstosmartaPPliances©©
by mike breslin
REALITYSTRATEGYVISION
ENERgy liVESThese articles focus on a few of the ever-growing number of factors that influence home energy decisions. mike breslin looks at home developers and appliance selection. elizabeth mcgowan studies multi-family housing impacts. and laurel lundstrom considers energy lifestyles.
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as THe smarT grid Train CHUgs oUT of THe sTaTion, iT’s liTTle wonder that renters nationwide fear being left behind on the platform—empty-
handed.Yes, their fancy digital meters and accompanying newfangled gadgets will
be the same as those installed at single-family homes. But with shared roofs and nonexistent backyards, how will residents of multi-family housing reasonably access renewable energy? And, what about energy efficiency? If landlords aren’t footing those gigantic utility bills, why should they care if their tenants have the most up-to-date appliances, lighting and heating/cooling systems?
Enter SMUD. That’s the less-than-flattering acronym for one of the nation’s more forward-thinking energy sellers, the Sacramento Municipal Utility District. Long a leader in solar options and energy efficiency, the California utility will be installing smart meters between late this year and spring 2011.
Renting outsmUdsPreadingenergyeFFiciencysmarts ©©
by elizabeth mcgowan
SMUD has introduced two programs specifically targeted to give apartment-, condominium- and mobile home-dwellers smart grid benefits.
For instance, SolarShares is a 1.2 MW “photovoltaic farm” that allows customers to buy the sun’s energy without installing panels on their own property. A separate initiative rewards multi-family property owners and managers with incentives and rebates for installing money-savers such as cool roofs, light-emitting diode exit signs or high-efficiency clothes washers.
demoCraTizing solar
“A few years back, we all sat in a room and asked, ‘How do you democratize solar for people?’” recalled Jim Burke, SMUD’s senior product and services coordinator, about the genesis for
VISION REALITYSTRATEGY
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ciency, recycling/waste reduction, water conservation, transit and community gardening. Partners are crafting a “Tenant Toolkit for Green Living” manual. In addition, vonKaenel is also pushing area utilities to make monthly electric and gas bills at every apartment publicly accessible.
“If a tenant is comparing two apart-ment complexes, this would give him a dollars-saving choice,” vonKaenel said. “It would push landlords to pursue energy conservation because the last thing they want is vacancies. It’s low-hanging fruit.”
To highlight successes, News & Review reporters will periodically feature apartment complexes excelling at conservation.
“All I did was get really smart people in the room together and let them talk to each other,” vonKaenel said about his undertaking. “I decided that, duh, we could be way more efficient if we worked together.”
By combining forces, SMUD and vonKaenel are keeping tenants in California’s capital city from being relegated to the energy-efficiency caboose.
“We end up improving quality of life for tenants because they end up paying less,” Sarkovich said. “And we end up generating less power and emitting less carbon dioxide. It’s a good thing.”
Elizabeth McGowan writes about energy and environment issues from Washington, D.C.
SolarShares. “We decided to borrow an idea from the financial world, modeled on a mutual fund.”
SMUD contracted with enXco, a French company, to construct a giant solar array made of 17,226 photovoltaic modules on an 8.5-acre section of a turkey farm in nearby Wilton, Calif. It’s configured to produce 1.8 million kWh over about 25 years.
The notion was so popular when it debuted in July 2008 that shares sold out within six months to about 700 customers eager to have 20 to 40 percent of their monthly electricity use come from solar. Some participants buy as little as 0.5 kW, while others purchase as much as 4 kW per month. They also have the satisfaction of knowing that their joint involvement is reducing greenhouse gases by more than 2.85 million pounds annually.
SMUD has agreed to purchase the electricity at a fixed rate for 20 years, while enXco owns and maintains the equipment.
“We realized there was no reason to climb up on the roof and drill holes,” said Burke. “SolarShares is the everyman’s demand side program. The idea was to make solar power cheap and easy and available to everybody.”
effiCienCy Has iTs rewards
Misha Sarkovich knows all about the split incentive—jargon for tenants being shortchanged on maximum energy efficiency by landlords who aren’t saddled with an exorbitant monthly utility bill.
As program manager for SMUD’s energy efficiency programs, he wants to fix that fracture. So when SMUD budgeted $750,000 in 2009 for 28 varied rebates and incentives aimed at multi-family housing (three units and up), Sarkovich promoted the heck out of it. He mailed brochures to vendors, contractors and property managers and owners, and spoke at the Rental Housing Association of Sacramento Valley’s annual conference.
His pitch was so successful that SMUD bumped funding up to $4 million—and allotted it all in the first four months of 2009. A redesigned version of the popular program will be rolled out in January.
“I did everything I could to bring this program into the limelight,” he said. “It was such an opportunity to capture the market. We just didn’t anticipate this level of activity.”
Most participants flocked to a rebate offer for installing EnergyStar compact fluorescent light bulbs in indoor and outdoor hardwired fixtures.
“The multifamily market is so heterogeneous and kind of a hard nut to crack,” Sarkovich said about a group that is roughly one-quarter of SMUD’s more than 522,000 residential customers. “You have small mom-and-pop owners and large corporations and they all make decisions differently. We had trouble estimating what the energy efficiency savings could be. Ultimately, we decided to be flexible and accessible with prescriptive rebates, clear-cut installa-tion directions and financing for property owners with lack of capital.”
ParTnersHiP Prods aParTmenT greening
Another voice backing energy efficiency for tenants emanates from the local alternative newspaper, the Sacramento News & Review. Its readership of more than 330,000 includes 130,000 renters. An outreach effort called the Green Apartment Partnership is the brainchild of CEO Jeff vonKaenel.
Pacific Gas & Electric and SMUD are among a diverse network of public and private partners intent on helping tenants gain a sustainable edge with energy effi-
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�low-hanging�fruit.”
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and communications department launched the pilot as a possible way to meet Fayetteville’s renewable energy standards—cutting back demand by 10 percent by 2018.
Lifestyles chosen for the pilot run the gamut—all ages, family sizes and professions.
By visiting a local energy expo, as well as a home and garden show, and putting up a promotion on its Web site, Fayetteville was able to choose people who wanted to save money and would give valuable feedback.
Although there was some concern about older generations and their familiarity with using the Internet, Justice-Hinson insists that most older people volunteering for the pilot were already regular Web users.
If the pilot is a success, the utility plans to expand the service to 20,000 of its customers within three years, covering about one quarter of its service territory.
Because participation is completely voluntary, Lynch said the utility will rely on customer satisfaction with the smart meters Fayetteville plans to install. Once customers realize the benefits of the new meters, PWC will begin affixing the communications devices.
Justice-Hinson finds the pilot to be “an eye-opening experience for a lot of people.” She noted that “people are visual and they have to be able to see it this way, and to see what they are controlling to make a difference.”
Laurel Lundstrom is a freelance writer based in Washington, D.C.
wHeTHer THey are sTaying laTe aT worK or exTending THeir vaCaTion for one more day, North Carolina’s Fayetteville Public Works
Commission (PWC) customers can control how much energy they use without going home to turn down the heat or turn off the air conditioning unit.
Through PWC’s new pilot program, which launched this past summer, certain residents and small commercial properties can cut back on the energy they use by setting lifestyle preferences online, helping them to keep their HVAC systems, water heaters and pool pumps turned off when they are out. They can also log on and modify their online profiles to remotely control their appliances if they need to spend extra time away, or if they want to warm up or cool down the house before coming home.
“It is empowering people and it is a much more economical solution than purchasing power at the maximum price or adding additional generation,” said Carolyn Justice-Hinson, PWC’s communications manager. “We anticipate a 15 to 20 percent energy savings for customers.”
Once customers create their profiles, they see their energy in bar charts on the computer monitor, or on their mobile device screens, said Keith Lynch, PWC’s contract resources and power trading manager and manager of the pilot project. “The purpose is to determine when you need energy and when you don’t need energy.”
Lynch, who is also taking part in the pilot himself, said he first created a fairly general profile according to when he comes and goes, and when he goes to sleep and wakes up in the morning, and then, like others, made it more concrete.
All 120 installations involved in the six-month pilot are up and running. The project facilitates communications among four devices: one placed on the HVAC system, one on the water heater, a communications chip on the home and a smart wireless thermostat. Some customers also have devices on pool pumps. By commu-nicating with each other and the Internet, customers and PWC can see real-time usage from the 120 homes.
The development is not only positive for consumers, but also beneficial for PWC.
“We are hoping to find a way to cut back or manage demand so that we don’t have to buy additional generation,” said Justice-Hinson.
Working together, PWC’s renewable energy team, business development group
Energy lifestyleskeePyoUrliFestyle,cUtyoUrenergyBills ©©
by laurel lundstrom
VISION REALITYSTRATEGY
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February 8, 2010 - Pre-conference WorkshopsFebruary 9-11, 2010 - Conference Sessions
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© 2009 Association of Energy Services Professionals
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Celebrate with us in Tucson
February 8-12, 2010 Tucson, Arizona
AESP’s 20th National Conference & Expo
The premier energy industry conference
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side of the fault, isolate the fault, restore power upstream of the disturbance and then create a downstream restoration plan. While this, in and of itself, does not provide a tremendous amount of asset management capabilities, it does allow the utility to reconfigure its system with certain transformer-related parameters in mind.
“We are currently in the process of implementing DAS,” reported Dhillon. So far, it is working well. “We have already seen reliability increases in the locations where DAS is in place,” he added.
There are even more ideas on the horizon for transformer asset manage-ment, including strategies to determine optimum distribution transformer sizing. In particular, Cobb EMC is looking at an advanced metering infrastructure system. “We will be able to detect how much load is on each transformer,” stated Dhillon. “This information will be integrated with our existing SCADA system. Then we will be able to determine the size of each transformer we need in each location.”
naTional grid’s TUrn
Another utility looking at smart grid applications for distribution trans-former asset management is National Grid. In fact, the utility may end up with some transformer asset manage-ment as part of its smart grid rollout, simply by default.
“As far as we are looking at smart grid, we are trying to get a good idea of how to monitor distribution trans-formers and how many to monitor,” said Clayton W. Burns, principal engineer for smart grid applications at National Grid. That is, there are some communication systems—such as broadband over power line (BPL)—that would require bridges to get the signal around the distribution transformer, because the signal won’t go through the transformers. “However, some of the vendors offer bridges that have specific
THese days, Cobb eleCTriC membersHiP CorPoraTion (Cobb emC), a CooP based in Marietta, Ga., uses geographic information system (GIS)
technology to manage information about its distribution transformers. “All the data is kept in there, including transformer ratings and how much they cost,” stated Bhaji Dhillon, a senior planning engineer with Cobb EMC.
In fact, Cobb EMC’s GIS technology provides the command and control centers for operating the utility’s grid. It can integrate a number of applications into a single common user interface. For example, it might interface with supervisory control and data acquisition (SCADA), customer information systems (CIS), weather informa-tion and so on.
The GIS also supports the design and records management of the utility’s principal assets—its transmission and distribution facilities. Through this functionality, the system can help manage the whole lifecycle of transformers, including maintenance reporting, maintenance history, inspection history, replacement schedules and failure rate analysis.
sCada + gis = das
Cobb EMC has been using SCADA technology since the late 1970s. While SCADA is not currently involved with distribution transformer asset management, the technology is being expanded so that it can.
As Cobb EMC evolves further into smart grid technology, it is working toward distribution automation system (DAS) mapping technology. “This will run the calculations on each transformer, including how much load is on each trans-former,” Dhillon continued.
How will the DAS mapping technology work? Cobb EMC is working with both its GIS and SCADA vendors to link their technologies. “We are getting the connectivity model from GIS and connecting it into our SCADA system,” said Dhillon. “The connectivity model has all of the information records from the system.”
The DAS mapping’s role in distribution transformer asset management is to provide real-time distribution network modeling, visualization and topology. It pulls everything from GIS and creates it in a real-time environment, essentially turning GIS maps into SCADA displays. This provides visualization of the entire system.
A key element of DAS mapping is fault detection isolation and restoration (FDIR). FDIR relates to distribution transformer asset management because when a fault occurs, FDIR allows the utility to locate the fault, open devices on either
STRATEGYVISION REALITY
Transformers smartergridswillchangeassetcare©©
by william atkinson
MAiNTAiN + DESigNThe next three articles look at how “smarts” will influence the maintenance and design of the grid. william atkinson first looks at how transformer maintenance will change. and then warren Causey and Curt Harler consider the impact of smarter design on existing networks.
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eleCTriCal neTworK design is a ComPlex, ConTinUoUsly evolving process that, according to a recent survey by Sierra Energy Group (SEG),
involves 115,000 individuals nationwide with about 55,000 of those working for utilities and more than 60,000 working for private engineering firms. Throw in others who specialize in substation design and some 20,000 who maintain geographical information records of these designs, and you have roughly 135,000 to 150,000 people working on what for many may seem an arcane pursuit.
Many of these people have engineering degrees that enable them to deal with the complex mathematical and scientific calculations necessary to deal with America’s complex and constantly growing electrical grids. Whenever a new generation source comes online, engineers have to design the system that will take the power from the station, get it to the correct voltages for the transmission system, specify all the proper equipment and supervise the construction. At the other end of the grid, when a new subdivision—or even one house—is added, similar steps are taken at lower voltages.
If all this work isn’t done correctly, the grid can become unbalanced and fail at any one of millions of points along the pathways that electricity must follow from the point where it is generated to the home or business where it is used. Failures are not tolerated very well by various governmental regulatory agencies at all levels, nor by the general public—such failures usually result in blackouts, either locally or in widespread areas.
To accomplish all this design work, engineers and those who work with them traditionally used their engineering and drafting skills to draw diagrams that were kept on file at the utility. In more modern times, geographical information systems and network design tools from firms such as Autodesk, Bentley and Intergraph have become widespread. According to the same SEG survey, only about a quarter of design work still is done manually on paper, and that occurs primarily at smaller utilities, often in rural areas.
What traditionally has been a complex, technologically sophisticated pursuit is about to become even more complex and possibly considerably more difficult. As politicians and others push for what is called the smart grid, they are envisioning a new grid that doesn’t always involve a straightforward electrical flow from central generation to end user. Smart grid is expected to embrace intermittent resources, which at times may be drawing power from the grid and at other times reversing the flow—through devices such as electric cars, solar cells and wind turbines, some of them not yet in production, but envisioned.
In addition to intermittent, two-way flows, design engineers also are going to see an increasing overlay of communications system and information technology on the grid. As they move from relatively simple supervisory control and data acquisition (SCADA) systems installed over the past 20 to 30 years, utilities now are going to have to plan for artificial intelligence nodes designed to operate the grid autonomously, massive amounts of consumption data developed from smart meters and so forth.
Most of these communications systems are being designed for IP communica-
monitoring in them for distribution transformers, as well as their main purpose, which is to provide a path for the BPL signal around the transformer,” he noted. As a result, the utility could end up with distribution transformer monitoring simply as a result of the vendor it selected for BPL.
National Grid is also looking at a wireless technology for its commu-nication system. “As a result, we are looking at novel uses of various types of revenue meters in order to take a look at the information on distribution transformers, such as load, power factor and power quality measure-ments,” he continued.
Whatever is used to monitor loading on a distribution transformer must overcome the challenge of getting it time-synched with everything else on the feeder. “If you look at the distribu-tion transformer, you would want to time-synch the data from the distribu-tion transformer with all of the meters on the secondary that the distribution transformer feeds,” explained Burns. On the upstream side, it would be necessary to time-synch the distribution transformer with the monitoring that is on the feeder—monitoring that is inherent to reclosers, regulator controls, capacitor controls and, ultimately, the feeder breaker at the substation.
“The time-synching is important in order to be able to calculate the trans-former loading in the downstream meters,” he emphasized. “By default, you would also be able to determine theft of service, voltage profiles on the secondary and be able to diagnose issues in the distribution transformer, such as loose neutrals and turn-to-turn winding issues.”
To date, in National Grid’s “proof-of-concept” test laboratory, it hasn’t found any major stumbling blocks to be able to monitor and time-synch, so it is planning on moving ahead with it.
William Atkinson is a freelance writer based in Illinois.
REALITYVISION STRATEGY
Smarter designdesigninggridnotreallytheProBlem©©
by warren Causey
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see people starting to shed load, that should take some strain off the system. As we start to see more plug-in vehicles, that will shift load significantly. The question is will we ever get to where we balance the load or unbalance the load? It’s hard to say, but there are going to be impacts on design because we’re going to be using more load off peak.”
The grid itself has become smarter from generation to generation with SCADA, distribution automation and other advances coming online over the past 20 to 25 years. What is missing is the communications overlay to enable smart meters, electric cars, intermit-tent renewable electricity, two-way flows and so on. Already control room operators can look at the grid in real-time on computer screens and see what circuits are functioning properly and which have outages. Already they can manipulate electric flows from their workstations. Already they can see the location of service vehicles as they move along streets and highways. Not all utilities have all of these capabilities, but many of them do and more become so-equipped every year.
Some utilities can already update grid design systems from the field with as-builts. Most utilities don’t do this extensively because they like to have system designs checked and double-checked before they are placed into service. But the capability already exists in many places. Engineers can already make live updates from the field if they want to.
The smart grid really is not that great of a challenge from the techno-logical or design perspective and new capabilities become available almost daily. As Grueneich and DeBald point out, however, the issue is going to be costly. It took untold trillions of dollars to build the grid as it is today. It will take additional trillions to rebuild it.
Warren Causey is senior vice presi-dent of Sierra Energy Group, a division of Energy Central.
tions, which do not flow very well over power lines—as has been proven in many failed experiments. CenterPoint Energy, for example, abandoned an experi-mental pilot involving power line carrier communications to read smart meters. Thus, a separate communications system to reach smart devices on the grid, substations, transformers, transmission systems and so on is going to have to be designed and overlaid on the grid. A mishmash of IP standards is going to have to be dealt with, as well as a whole raft of new devices that often have proprietary communications protocols.
In addition, consider in-home devices that must be communicated with to enable demand response—reducing residential consumption to compensate for a decline in central generation. “Most of the technology is going to be able to cope with the new challenges. Smart grid doesn’t do much until you get to end-use consumer products,” said Dan Walter, senior manager, energy markets with
Tri-State Generation and Transmission Association. “We need to start getting washing machines ready to turn on/turn off. Smart grid with electric cars is going to be tricky. There will be a real challenge with intermittent resources. And if you believe some of the draft legislation on where they want to be on carbon in another 20 years, that will be a huge challenge.
“We never say never [as far as designing a system to work] is concerned,” Walter continued. “It all depends on what you want to pay for electricity. If the price goes up, then the whole system will feed on itself, there will be more efficient products and people will use less energy.”
Price, both of electricity in the future, and of the systems and networks that have to be built out, is the major issue. At a meeting in New York City recently, Dian Grueneich, commissioner of the California public utility commission, said publicly that building out the smart grid is going to “cost trillions of dollars.” From a techno-logical perspective, all this is doable, if complex, but it isn’t going to be inexpensive.
Baltimore Gas & Electric Co. is struggling with the cost issue on smart grid, according to Barry DeBald, a senior information analyst with the utility. “Right now, everything is pending public service commission approval,” he said. “We’ve done some preliminary rollouts on smart meters and they worked well. But going systemwide is a $500 million to $600 million proposition. Whether we’re going to be approved is a coin flip. As far as how network design will change, as we
a CHain is only as sTrong as iTs weaKesT linK. ofTen forgoTTen in the move to smarter grids and smarter networks is the need to strengthen
the existing infrastructure. Whether for an electrical, gas or water utility, the rest of the network has to be upgraded to handle the smart components.
At Las Vegas Valley Water District (LVVWD), the new grid is helping to improve existing systems. “We’ve integrated survey, CAD and geospatial infor-mation systems (GIS) to ensure that the geospatial database has the precision necessary to better manage buried facilities,” said Jonathan Pickus, manager of the automated mapping/facility management/GIS division for LVVWD. “All work orders for both the developer and major construction are field surveyed with technology that integrates this information into the CAD/GIS environ-ment,” he explained.
“Digital redlines” for construction are automatically produced from this informa-tion for use by inspectors. Engineering software creates as-builts whose data then is automatically integrated into the GIS. Work orders operate in a similar fashion.
As a desert utility, water leakage is a huge issue for LVVWD. A small leak can become a significant opera-tional and environmental expense. LVVWD’s leak detection network consists of an array of listening devices deployed along most of the asbestos-cement pipelines and concrete-lined and coated welded steel pipe.
“This network records and stores acoustic information, which is captured through drive-by collectors and analyzed for potential leaks,” Pickus said. The leak detection network and results are displayed through the geospatial portal.
LVVWD’s valve preventive maintenance management program also benefits from the technology. The operations group has an aggressive program to visit critical valves to ensure they function properly. “The use of valve exercise machines combined with field-deployed GIS enables staff to more efficiently perform preventive maintenance (PM), report turns, torque and other informa-tion, and modify geospatial records when errors are found,” he said. Data is displayed through the portal, with valves themed by PM results.
“Results of geometric connectivity analysis of major pipelines and the valves used to help isolate this network are displayed through the geospatial portal,” Pickus said. Distribution uses this information to prioritize valve PM and support leak isolation.
Other benefits Pickus sees include better review and improvement of inspec-
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tion procedures, additional data collection to support lifecycle manage-ment of facilities, and improvement in design specifications and drawings. In hard terms, LVVWD keeps its water loss due to leakage to 6.2 percent—well below the industry average.
Exposure of staff to the geospatial portal and the power of GIS have advanced the appropriate use of technology by all. “Over 500 staff regularly accesses the geospatial portal to support business activities. We routinely get recommendations from users, which are put in place on a regular basis,” he added.
So far, they have enjoyed success pulling together different technologies
and information resources. “We deploy GIS systems for field use and our geospatial portal is one of the District’s most-used resources. The accuracy and usefulness of this data are directly attributed to the efficiencies gained through integrated land survey-CAD-GIS technology and our organizational model allows these groups to work closely together. Data is usually entered once, with systems that help propagate
and synchronize this information to support multiple business processes, products and services,” he said.
They also are working on smart maps. “We produce 5,000 maps annually to support the complete engineering lifecycle,” he said. “We have systems that provide access to these maps in the field. We are developing procedures and automa-tion to generate smart maps that provide interactive capabilities—like measurements, redlining and reports on map objects without requiring wireless services.”
Curt Harler is a freelance writer based in Ohio.
a CHain is only as sTrong as iTs weaKesT linK. ofTen forgoTTen in the move to smarter grids and smarter networks is the need to strengthen
the existing infrastructure. Whether for an electrical, gas or water utility, the rest of the network has to be upgraded to handle the smart components.
At Las Vegas Valley Water District (LVVWD), the new grid is helping to improve existing systems. “We’ve integrated survey, CAD and geospatial infor-mation systems (GIS) to ensure that the geospatial database has the precision necessary to better manage buried facilities,” said Jonathan Pickus, manager of the automated mapping/facility management/GIS division for LVVWD. “All work orders for both the developer and major construction are field surveyed with technology that integrates this information into the CAD/GIS environ-ment,” he explained.
“Digital redlines” for construction are automatically produced from this informa-tion for use by inspectors. Engineering software creates as-builts whose data then is automatically integrated into the GIS. Work orders operate in a similar fashion.
As a desert utility, water leakage is a huge issue for LVVWD. A small leak can become a significant opera-tional and environmental expense. LVVWD’s leak detection network consists of an array of listening devices deployed along most of the asbestos-cement pipelines and concrete-lined and coated welded steel pipe.
“This network records and stores acoustic information, which is captured through drive-by collectors and analyzed for potential leaks,” Pickus said. The leak detection network and results are displayed through the geospatial portal.
LVVWD’s valve preventive maintenance management program also benefits from the technology. The operations group has an aggressive program to visit critical valves to ensure they function properly. “The use of valve exercise machines combined with field-deployed GIS enables staff to more efficiently perform preventive maintenance (PM), report turns, torque and other informa-tion, and modify geospatial records when errors are found,” he said. Data is displayed through the portal, with valves themed by PM results.
“Results of geometric connectivity analysis of major pipelines and the valves used to help isolate this network are displayed through the geospatial portal,” Pickus said. Distribution uses this information to prioritize valve PM and support leak isolation.
Other benefits Pickus sees include better review and improvement of inspec-
New grid, old gridlvvwdsmartsimProvelegacynetwork©©
by Curt Harler
STRATEGY REALITYVISION
las Vegas from the air i
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“TelePHone” is a game Played by CHildren and Used by CommUniCaTion experts to demonstrate how messages that are conveyed from person to
person can become unreliable. In the game, a message is told to the first person, who then tells it to the next and so on through the group of many participants. When the message is received by the last person in the chain, it often differs greatly from the original message. The differences, of course, are a result of key parts of the message being lost or modified as it works its way through the various participants.
Electronic messages sent or received can suffer from the same phenomenon and for similar reasons. As electronic messages pass from device to device, they are susceptible to the loss or modification of portions of the message, often referred to as packets. The lost portions of the message may change the entire message, or even prohibit its delivery. Thankfully, the development and evolution of standards related to electronic communications has made that an infrequent event for most mature electronic network environments, such as those found in most office settings, the Internet and many home networks.
In the utility industry, though, we are witnessing the development of new types of networks, based in part on new technologies. The realization of a smart grid depends on the ability to transmit and receive electronic messages between devices on the electric transmission and distribution network, the meter attached
to the residence or business, devices within the residence or business and, of course, the monitoring systems utilized by the utility company providing the power. It is a complicated series of interrelated commu-nication networks that, unless properly designed and implemented, may experience the same type of communication failures found in the telephone game.
Consider this example. A monitor on a distribution transformer senses a loss of power and sends near simultaneous electronic messages to:
thecontrolcenterand/oroutagemanagementsystem(oms)sothatthe??
outagecanbeconsideredalongsideothereventsthatmaybeoccurringtheworkmanagementandscheduling/dispatchsystemsothatworkers??
canbeassignedandmaterialsallocatedperpredefinedrulesthecustomerinformationsystemsothatcustomersservedbythat??
transformercanbenotified
Each of these systems, in turn, may also send nearly immediate electronic messages to other interested systems, people or even entities. For example, the
Telephone gamedealingwithinterrelatedcommnetworks©©
by bart Thielbar
OMS may be designed to notify certain management personnel, customer service representatives or even vendor companies that help to supply labor or materials. Likewise, depending on configuration, the scheduling and dispatch system may receive alerts from the OMS and geographic information system and then send alerts to personnel best suited to address the suspected problem. In this type of automated envi-ronment, it is easy to see how compli-cated electronic messaging can be in a smart grid and how easily the pitfalls of the telephone game could negatively impact the flow of information. A single lost packet or interrupted message could have a devastating downstream effect. Imagine a lineman’s surprise if a device signaling a loss of power actually did have power.
Generally speaking, there are three segments to the network that will enable the smart grid: the network within the utility company, the network on the transmission and distribution system inclusive of the meter and the network within the business or residence. Without the ability to move
REALITYVISION STRATEGY
COMM AREASThis section focuses on the varying needs of different communication network areas. bart Thielbar looks at the complications of networks in the utility, on the grid and in the home. john johnson looks at how Hydro one is balancing the needs of its backhaul and last mile networks.
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such as those utilized by cellular phone companies or traditional phone companies. Additionally, many utilities have utilized their own infrastructure, such as proprietary fiber-optic networks or, in some cases, wireless networks utilizing Wi-Max or Wi-Fi. Many utilities are in the process of connecting more and more smart devices to these hybrid networks, including smart meters and various monitoring devices. The standards and protocols used by these hybrid networks are, in many cases, different from the standards and protocols used by traditional network environments such as those found within the utility’s own office network.
The networks utilized within a home or business typically closely resemble those found in most utility offices. That is, they are often Ethernet-based and are relatively mature and less susceptible to disruptions. In the future, though, many of these homes and businesses will attach devices to their networks that may impact the reliability and performance of the in-residence networks. For example, a smart appliance may be connected to a home or business network so that the owner can monitor energy consumption of that appliance and exercise some control over it. It will be incumbent upon the manufacturers of these smart appliances to ensure that the communication standards and protocols they use will be compatible with the network environments used in the homes or businesses, as well as those used by the utility companies—on both the communication network serving the transmission
and distribution system, as well as the communication network utilized within the utility company. Carrying a packet of electronic information from a water heater,
for example, all the way to the utility company is a complex undertaking and requires the use of common communication standards and protocols.
sTandards bridges
Utilities and equipment manufacturers, as well as regulators, are well aware of these complexities and have been striving
to achieve a set of useful standards that will help promote a ubiquitous communication network that will enable a smarter grid. In late September, Commerce Secretary Gary Locke announced an “accelerated plan for developing standards.” More specifically, the Commerce Department’s National Institute of Standards and Technology (NIST)
issued a 90-page document that “identifies about 80 initial standards that will enable the vast number of interconnected devices and
systems that will make up the nationwide smart grid to communicate and work with each other.” It is an ambitious, yet necessary, undertaking.
The participation and cooperation of interested parties, as well as the Commerce Department and NIST, will help ensure that the communication networks serving the smart grid will not fall victim to the missed and distorted messaging inherent in the game of telephone. It will be good for the industry and for those who rely upon the industry—but only if done correctly.
Bart Thielbar is a senior research analyst with Sierra Energy Group, a division of Energy Central.
electronic messages seamlessly through these networks, the realization of the smart grid will fall far short of its potential.
Different types of technologies support each of these types of networks. The networks within utility companies usually consist of Ethernet-based protocols and run on wired or wireless infrastructure. They are mature in their implementation, have been well tested through the years and rarely experience communication disruptions.
The communication network serving the transmission and distribution system is usually much more complex and, in many cases, less complete in that not all devices are connected. For example, a communication network serving the transmission and distribu-tion system may consist of instances of wired or wireless Ethernet, analog radio, proprietary network configuration and even third-party carrier networks,
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message�could�
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functions as an IP-based network, it serves as the off ramp for the fiber network. Therefore, Hydro One can backhaul collector data and integrate it with its fiber ring. Hydro One settled on WiMax because on a dollar-per-megabit-per-kilometer scale, “It’s by far the lowest-cost, highest-quality, highest-bandwidth application that we could find,” said Stevens. “In urban areas, some utilities run broadband power lines all over the place or extend their fiber networks. Some are even choosing options like Wi-Fi—but those solutions
don’t work in rural Ontario.” Though WiMax is a cure for Hydro
One’s rural smart metering applications, down the road it will also help the utility to communicate with a number of other smart grid applications, such as automating and viewing distribution systems, voltage regulators and circuit reclosers. And as more and more renewable energy projects like wind turbines and solar come into Ontario, WiMax will be counted on to control and protect those devices as well.
“Some of the historical protection schemes are very pricey,” said Stevens. “So we’re hoping to be able to satisfy that need using this WiMax application.”
John Johnson is a freelance writer based in Massachusetts.
wHen exeCUTives aT Hydro one in onTario firsT began To researCH how they would meet a government mandate to install smart meters for
all customers by the end of 2010, they considered several networking options. The government-operated utility provides electricity to 1.3 million customers, many located in rural, out-of-the-way areas.
Deciding on a technology infrastructure for its backhaul and last-mile operations wasn’t easy. Because Hydro One didn’t know where all of its end points were located, it chose to install smart meters first and then build a network behind the rollout. Hydro One outfitted its meter installers with GPS devices and barcode readers on handheld devices, and then performed radio frequency (RF) propagation studies to determine RF signal strengths to locate optimal network hardware points to complete the advanced metering infrastructure system.
When it came to its communications network, Hydro One had several options for the inner ring of communication—or backhaul—which runs from the collectors and substations back to the utility, and the outer ring—or last mile—which runs from the substations and collectors to the meter. In Hydro One’s case, much of the decision-making process focused around the fact that many of its customers are located in the countryside.
Hydro One was fortunate to have a robust, high-bandwidth, low-latency fiber ring around Ontario, which has historically been used to protect and control its elec-trical transmission system. As for meter deployment, Hydro One is building a local area network (LAN) using wireless mesh technology, which allows meter-to-meter communication. Data from the meters then finds its way to a collector and Hydro One backhauls that collector utilizing WiMax 802.16. Hydro One has deployed a standards-based hybrid radio system using IEEE 802.16 to make all the communica-tions happen. “So there is an RF mesh LAN, and an RF point–to-multi-point wide area network off ramp, and at the other far end of the equation we have our fiber ring,” said Rick Stevens, director, distribution business development at Hydro One.
In order to meet the Ontario mandate, Hydro One embedded cellular modems into its collectors, which allows them to communicate backward to back office systems. However, some parts of rural Ontario are still without cellular service, requiring Stevens and his staff to rely on a backup technology to backhaul data in those areas. Hydro One decided to run WiMax, a technology that provides wireless data transmission. The WiMax will run off a specially allocated spectrum granted to Canadian utilities requiring critical infrastructure protection.
Because Hydro One installed Ethernet ports in its collectors, and because WiMax
Comm ringshydroonelooksatBackhaUl+lastmile ©©
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Industry Leaders. Strategic Issues.
Formative Discussion.
What will this new structure of energy look like and how close are we to building it? At the 2010 EnergyBiz Leadership Forum, industry leaders will:
Sift through the fallout of the economic downturn.
Examine early returns on American Recovery and Reinvestment Act (ARRA) investment.
Hold a frank discussion on where we are and need to be in developing a new energy economy.
Visit: www.energybizforum.com.
Industry Leadership Partner: Keynote Partner: Produced by: Presented by:
Where is energy headed?In the United States, we’ve witnessed unprecedented spending on energy resource development and infrastructure. As a result, one thing is clear — a new energy architecture is emerging.
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and Electric, which at the time was only 4 percent renewable generation,” said Bingham. “That’s when we got politically involved.” This involvement meant aligning with other faith-based organizations, which ultimately helped to turn the Episcopalian endeavor into an interfaith phenomenon. In 2002, the campaign went national and, today, there are more than 10,000 congrega-tions in 29 states participating in the Interfaith Power and Light campaign.
CongregaTion bUildings
Once congregations sign on, the campaign works with them to reduce their carbon footprint. This first includes an energy audit of their building. Based on the audit results, congregations can take a variety of actions—from weatherizing buildings and installing more energy-efficient appliances to designing LEED-certified structures and installing solar panels.
“The beauty of solar on a congrega-tion building is that your average 400-person parish out across the country is really only open on Sundays,” said Bingham. “Generating solar energy and selling it on those other days could provide an enormous incentive to put solar on a roof.” However, there are certainly challenges to installing solar. “Congregations are already nonprofits, so they don’t get tax breaks or subsidies to do this,” said Bingham. And many places still don’t offer capabilities for net metering and real-time tracking of the solar power congregations are producing for the grid.
Even if solar panels aren’t an option, though, the campaign also encourages congregations to switch to a renewable energy program, if their utility offers it.
ParTiCiPaTion
So improving a building’s energy effi-ciency helps, but again, many congrega-tions use these buildings one day a week. “If you turn on a light switch, no matter
we Have Heard a loT of TalK aboUT ConsUmer engagemenT THese days. And when the utility industry discusses energy consumers at a high
level, it is most often talking about either business or residential consumers. But what about congregational energy consumers? Buddhists, Episcopalians, Swedenborgians, Roman Catholics, Muslims—and the list goes on and on—occupy more than 380,000 congregation buildings across the United States.
Enter The Regeneration Project and its Interfaith Power and Light campaign. The campaign is, according to its Web site, a “response to global warming in congregations through the promotion of renewable energy, energy efficiency and conservation.” Curious to learn more about what this meant, I chatted with the Rev. Canon Sally Bingham, president and founder of The Regeneration Project.
We talked about the project’s history, how congregations can improve the energy efficiency of their build-ings and better inform its membership about energy conservation—and, ultimately, how all of this ties in with a smarter grid.
ProjeCT baCKgroUnd
When electric industry deregulation rolled around in the 1990s, green energy marketers entered the California utility space. This opportunity captured the interest of Bingham. She noted that in the beginning “I had no concept of where electricity came from, but I knew it was a very serious issue to know how your behavior affects another person.”
Bingham began to encourage Episcopalian churches across California to purchase more green energy, but it wasn’t easy because many people didn’t understand what it would take to go green. For example, according to Bingham, “some people were thinking that you had to take down the power lines running into churches and put up new ones.” Eventually though, 60 of the 450 Episcopalian congregations in California purchased renewable energy from Green Mountain Energy.
Then the California energy crisis hit and green energy marketers left the state. “Our churches buying from Green Mountain Energy turned back to Pacific Gas
Green congregation interFaithPrograminsPiresconsUmers ©©
by H. Christine richards
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Power lines form an intricate design at the
Grand Coulee Dam—located on the Columbia River in central Washington. The dam is the largest concrete structure in the United States and the third largest hydroelectric facility in the world. It has a total generating capacity of 6,809 MW.
where you are, your behavior affects the world,” noted Bingham. “Unfortunately, we do not have enough education and advocacy going on right now.” So the Interfaith Power and Light campaign also encourages congregations to educate their members about energy efficiency, conservation and renewables.
How iT fiTs in wiTH a smarTer grid
For Interfaith Power and Light, energy conservation comes first, but consuming and producing renewable energy is still a key component. And more renewable energy, as U.S. Energy Secretary Steven Chu has pointed out, will require a smarter grid to handle the increasingly complex interactions. “It is a matter of common sense,” said Bingham. “If we promote more wind, more solar, how is this electricity going to get delivered unless the whole infrastructure is redone? It’s got to be regenerated.”
Complex design
Have an interesting picture of power lines? send it to
[email protected] and it may appear in the next issue of Intelligent Utility.
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