the utility of the future a - kema uof.pdf · 2009. 9. 11. · 4 the smart grid movement is well...

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The Utility of the Future

KEMA Perspectives and Observations

Will McNamara & John Holt

September 15, 2009

2

Topics For Discussion

• Smart Grid and Utility of the Future Trends

• How Generation, Transmission and Distribution Work Together in a Smart Grid Scenario

• Next Generation EMS

• The Impact of Renewables on Operations

• Securing the Smart Grid

3

Discussion Topics

• Smart Grid and Utility of the Future Trends

• How Generation, Transmission and Distribution Work Together in a Smart Grid Scenario

• Next Generation EMS and Control Centers



4

The Smart Grid movement is well underway• Select Smart Energy Initiatives in North America

– Department of Energy (DoE) Modern Grid Initiative– DoE Electricity Advisory Committee & Task Force– GridWise Alliance– GridWise Architecture Council– Demonstration projects via key national labs (e.g., Pacific Northwest)– Numerous utility programs – one has now filed for full deployment in two jurisdictions

• Energy Independence & Security Act of 2007 – Signed Dec.19, 2007– Title XIII: Smart Grid Provisions - It is now U.S. policy to support the modernization of the electric transmission and

distribution system to maintain reliability and infrastructure protection

– Smart Grid Technology Research, Development and Demonstration – including matching funds

– State Consideration of Smart Grid – encourages regulatory reviews beyond just AMI

– Smart Grid System Report – due soon• American Recovery and Reinvestment Act – Signed Feb. 17, 2009

– Electricity Delivery & Energy Reliability (Smart Grid) - $4.5 Billion for Federal matching grants (up to 50%) and

demonstration project funding

– Energy Efficiency - $16.8 Billion for block grants to states to promote energy conservation and energy programs

– Tax Incentives - 50% special depreciation allowance for utility property through 2009 and 30% investment tax credits

for smart grid technology manufacturers

5

EISA has provided federal guidance on smart grid

Smart Grid Characteristics1

(1) Increased use of digital information and controls

(2) Dynamic optimization of grid operations and resources

(3) Deployment and integration of distributed resources

(4) Development and incorporation of demand response

(5) Deployment of ‘‘smart’’ technologies (real-time, automated, interactive)

(6) Integration of ‘‘smart’’ appliances and consumer devices

(7) Deployment and integration of advanced electricity storage and peak-shaving technologies

(8) Provision to consumers of timely information and control options

(9) Development of standards for communication and interoperability of appliances and equipment

(10) Identification and lowering of unreasonable or unnecessary barriers to adoption

Note 1: Extracted from Section 1301, STATEMENT OF POLICY ON MODERNIZATION OF ELECTRICITY GRID

6

There are also numerous variations in architecture and naming conventions, all focused on similar core issues

Selected Utility Smart Grid Efforts

• SmartGrid - Duke Energy

• gridSMART – American Electric Power

• Intelligrid – CEMIG (Brazil)

• Blueprint for the Future – Pepco Holdings, Inc.

• Avanti: Circuit of the Future –Southern California Edison

• Circuit of the Future – Kansas City Power & Light Co.

• Intelligent Utility Grid - CenterPoint Energy

• Power the Future – WE Energies

• How can initial investments in AMI or Smart Metering be leveraged into a broader Smart Grid architecture?

• Which technologies are ready for investment now? Which ones should be deferred?

• What is the right regulatory recovery scheme (short and long-term)?

• How will consumers accept and interact with these applications?

• How will incremental CapEx requirements be integrated into existing grid resource plans?

• What rate and service offerings are needed to maximize consumer participation?

• How well will standards drive innovation, while maintaining security and reliability?

7

One comprehensive view of the Smart Grid focuses on its desired operating characteristics

Electricity delivery network modernized using latest digital/information technologies to meet key defining functions:

• Enabling active participation by consumers • Accommodating all generation and storage options • Enabling new products, services, and markets• Optimizing assets and operating efficiently • Anticipating and responding to system disturbances in

a self-healing manner • Operating resiliently against physical and cyber attack

and natural disasters• Providing the power quality for the range of needs in a

digital economy

The evolution of a smart grid will be one of continuous improvement

Source: U.S. Department of Energy National Energy Technology Laboratory, Modern Grid Initiative

7

Modern Grid Initiative

8

“A Smart Grid generates and distributes electricity

more effectively, economically, securely, and in a

sustainable way. It integrates innovative tools and

Another view sees the Smart Grid as a means to a more sustainable future

Characterized by:

• Two-way distribution flows• Customer information• Customer participation• Variability and intermittency• ‘Internet-like’

Utilizing:

• Renewable generation sources• Micro-generation and CHP• ICT and Power Electronics• Bulk energy storage• Transport integration

Source: The Energy Policy Initiatives Center, University of San Diego School of Law

technologies, products and services, from generation, transmission and distribution

all the way to consumer appliances and equipment using advanced sensing,

communication, and control technologies.” (adapted)

9

A KEMA working description has also been offered

Smart Grid is the networked application of digital technology to the energy delivery and consumption segments of the utility industry. More specifically, it incorporates advanced applications and use of distributed energy resources, communications, information management, and automated control technologies to modernize, optimize, and transform electric power infrastructure.

The Smart Grid vision seeks to bring together these technologies to make the grid self-healing, more reliable, safer, and more efficient, as well as empower customers to use electricity more efficiently.

It also seeks to contribute to a sustainable future with improvements to national security, economic growth, and climate change.

10

AMI is the evolutionary step to previous-generation AMR systems, offering much greater functionality and benefits

Traditional AMR

(One-way)

AMR Plus

AMI(Full two-way)

Fina

ncia

l Inv

estm

ent/

Pot

entia

l Ret

urn

Operational Functionality/ Flexibility

• Automated monthly reads• Tamper reporting• Improved meter reading

accuracy

• Daily or on-demand reads• Hourly interval data• Outage notification• Load profiling

• Integrated remote reconnect/disconnect• Advanced (time-based) rates• Distributed Generation detection and control• Remote meter programming• Power Quality monitoring/ reporting• Home area network interface• Enhanced security compliance

AMR vs. AMI Capability

11

11

Why does our grid need to become “smart” or “intelligent”?• Our electric generation, transmission, and distribution infrastructure is

rapidly aging and out of synch with new digital technology• Core utility workers needed to operate and maintain the grid are also

aging and getting more difficult to replace• Central generation energy production is becoming more capital

intensive, leading to an increase in distributed generation resources• While T&D spending is increasing, the allowed rate of return will require

greater focus on longer-term horizons and greater project benefits• Carbon legislation is on the horizon and new technologies and practices

are needed to meet our sustainable needs

Running today's digital society through yesterday's grid is like running the Internet through an old telephone switchboard Reid Detchon, Energy Future Coalition

12

Our electric power infrastructure is rapidly aging and in need of replacement and increased maintenance

• Average transformer age is 30+ years

• Average circuit breaker age is 35+ years

• New equipment installations peaked in

early 70’s

Source: KEMA research and analysis; “Implementing New Technology in an Aged Infrastructure: Case Study of Incremental Automation”, Willard, S., Transmission & Distribution Construction, Operation and Live-Line Maintenance, 2006. ESMO 2006. IEEE 11th International Conference

Like many power system devices, studies have shown that a 1% failure rate associated with newer transformers increases to 3% and much higher when they reach decades of use

13

Our grids are also out of synch with new digital technology and advances in computing architecture

• Improving grid reliability has become a major concern – particularly with the prolonged nature of recent, large-scale power outages

• Control systems are antiquated, providing limited automation and ability to “see the whole grid”• Minimal system condition information is available to provide greater preventative maintenance

intelligence

Source: KEMA research, Roger N. Anderson – Columbia University

ss

Sample SAIDI Values

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Sample SAIDI Values

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14

Core utility workers needed to operate and maintain the grid are also aging and getting more difficult to replace

Trends• There is an increasing gap in supply and

demand for skilled craft positions –especially line workers, engineers, pipe fitters, and plant operators

• As many as 60% of select positions are retirement eligible over the next 5 years

• As the workforce ages, the ability to source, recruit, and retain replacement talent is becoming more difficult – only 1250 hired last year in key positions

• Even if workers stayed in their positions past retirement age (due to economic impacts), hiring rates would still need to increase by 30% or more

Source: Gaps in the Energy Workforce Pipeline: 2008 CEWD Survey Results, Center for Workforce Development

0

5

10

15

20

25

18-22 23-27 28-32 33-37 38-42 43-47 48-52 53-57 58-62 63-67 68+

Utility Workforce Age Distribution

% of Total Average Utility Worker = 45.3 yearsAverage American Worker = 40.7 years

New, electric power plant construction is under pressure due to rapid rises in near-term construction costs

Source: Associated General Contractors of America

Trends• Many raw materials (e.g., steel,

copper, cement) and other inputs into utility construction projects are rapidly increasing lately due to:

– High global demand (e.g., China)

– Lower U.S. dollar valuation– Increased labor costs

• Prices for other finished components – switchgear, heat exchangers, pumps, drives – are also increasing at 10 to 30% annually since 2003

• Manufacturing constraints are leading to increased lead times on numerous components, particularly large turbines

16

As a result, overall central station power generation is becoming less prevalent, even with growth in renewables

Power Plant Additions

010,00020,00030,00040,00050,00060,000

2003 2004 2005 2006 2007

MW

New Plants Plant Expansions

5-Year Annual Change: -31%

Source: EEI Website and Electric Perspectives magazine

Power Plant Cancellations

0

5,000

10,000

15,000

20,000

25,000

2003 2004 2005 2006 2007

MW

Observations

• Consistent declines in new capacity and increased cancellations have helped absorb early 2000s overbuild

• Wind energy now represents the most dominant type of plant being brought online

• With uncertainty over emerging renewable policy mandates, many coal and gas plants are being cancelled (especially near cities) and replaced with plans for nuclear, wind, and other renewables

• However, the intermittency of solar and wind will require greater ancillary services to offset lower capacity and availability factors

17

Over the next two decades, smart grid investments are expected to increase more than five times current levels

Source: Smart Grid: The Next Infrastructure Revolution, Morgan Stanley, 2009

Smart Grid Spending Projection

18

Smart grid funding is expected to impact numerous industry stakeholders

The Smart Grid funding appropriation is one of the very few energy-related areas that remained consistent in the ARRA Bill’s life-cycle

DOE Stimulus Funding(Total Appropriation = $39.2B)

Smart Grid & Grid Modernization

11%

Fossil Energy Research

9%

Western Area Power Admin.

8%

Bonneville Power Admin.

8%

Office of Science4%

Adv. Research Projects Agency

1%

Renewables Transmission Loan

Guarantee Program

15%

Energy Efficiency and Renewable

Energy44%

Utilities

Manufacturers1

Services Firms

Regulators

Policy Makers

Consumers

Key Stakeholder Impacts

• Project advancement • Enhanced environmental compliance• Increased reliability

• Increased revenue/ growth• New job positions• Technology advancement

• New offerings/ launches• Job retraining• Extended business partnerships

• Enhanced services to constituents• Environmental policy achievement• Increased certainty of benefits

• Increased jobs• Improved economic prosperity• Government budget stabilization

Note 1: Includes AMI suppliers, advanced battery developers, distributed generation developers, renewable energy systems suppliers, electronics firms, power equipment suppliers, appliance manufacturers, and numerous others

• Ability to lower energy costs• Increased environmental stewardship• Deferral of future tax increases

19

Smart grid technologies are potentially disruptive to the traditional utility value chain, particularly for consumers

Power Production Transmission Distribution Consumption

• Distributed generation and energy systems

• Distributed energy storage/ renewable energy

• Conservation voltage reduction

• Synchronized Phasor Measurement Units (PMUs)

• Flexible AC Transmission

• High Voltage DC• Substation energy

storage

• Advanced Metering Infrastructure (AMI)

• Line fault sensors• Automated

reclosers• Automated

Volt/VAR control• Automated voltage

regulators• Automated

capacitor banks

• Home area networking• Autonomous DR• Smart appliances• Distributed generation• Integration of building

controls• Plug-in Hybrid Electric

Vehicles• Micro energy storage• Rooftop solar energy• Pre-payment systems• Time-based pricing• Third-party service

providers (e.g., DR)

Leading Smart Grid

Considerations

Degree of Market

DisruptionMinimal Moderate Large Transformational

Smart Grid deployment will open a $100B market in smart technologies1

Note 1: Department of Energy; The Reform Institute, “The Smart Alternative: Securing and Strengthening Our Nation’s Vulnerable Electric Grid”

Traditional Utility Value Chain

20

AMI provides increased network connectivity and communications between the customer and the utility

AMI Meter

MDM/ Utility Back Office • Outage Mgmt.

• Adv. Billing

Customer Premise

AMI Connectivity (illustrative) AMI Communications Trends

• Full two-way (bi-directional)• Near real-time data read/access• Higher bandwidth• Increasing number of

communications nodes• Robust Meter Data Management

systems to interface with back office

• Peer-to-peer mesh networks• Distributed generation control• Multiple backhaul integration • Device interoperability• Open communications protocols• Self-diagnostics and programming• Minimal network administration• Self-registry capabilities• Price signals to smart appliances• Meter as a premise “portal”

Remote Access

Gas or H2O AMR Meters

Wired Solutions

Wireless Solutions

21

The number of vendors seeking the Home Area Networking market issignificant – many expect to follow the AMI path to commercialization

Home Area Network Vendors

Smart Thermostats

• Comverge• Invensys • Broadband Energy Networks • Intellicom Innovation AB • Vantage Controls

In-Home DisplayDevices

• Johnson Controls, Inc.• Honeywell• Carrier• Domosys Corp.• Comverge• Delta Controls • HAI

• Intermatic• Leviton• RAM Industries• Baco Controls • Corporate Sys. Engineering• Invensys • Domosys Corp.• Dencor• Brayden Automation Corp.

Load ControlSwitches

• Lighting Control and Design• Lightstat Inc.• Lutron• Douglas Lighting Controls Inc.• Powerline Control Systems,

Inc.• Vantage Controls• Synergy

Lighting Controls

The key to success of this “next generation” of products will be

through industry-wide, open communications protocols and

interoperability

22

On the consumer side, the potential impact of Plug-in Hybrid Electric Vehicles is significant and highly anticipated

Chevy Chevy VoltVolt

Toyota Prius

Ford Escape

Consumer sentiment and fuel prices will dictate how rapidly PHEVs will be adopted as a viable

supply/ demand option for the smart grid

Anticipated PHEV Impacts• Potential impacts to the U.S. grid are significant:

– 1.5 kW (avg.) X 256M vehicles = 384 GWs– Power generation today = 986 GWs

• Vehicle can potentially provide energy storage in response to appropriate pricing plans

• Intelligent plugs would communicate with the electric utility to automate nationwide billing and control

• Battery storage also can provide spinning reserves and ancillary services

• New business models may exist for utilities and others to provide secondary battery markets/swaps

• External firms such as Google are investing in PHEV demonstration projects

Source: KEMA Research, Energy Information Administration, US Dept. of Transportation

23

When does the “Smart” grid become truly intelligent?

Intelligent Grid Characteristics

• Sensors and controls become truly autonomous, driven by self-correcting, intelligent algorithms, operationally embedded

• Utilities and energy providers are making the investment decision a priority, with intelligent controls a design standard for asset management

• New stakeholders and market participants offer a larger array of new products and services

• Regulators and policy makers enable effective cost recovery schemes, not tied to the current regimes

• Consumers demand the flexibility and fully engage as active participants

23

AMI

AutomatedLine

Sensors

DER

EnterpriseData

Systems

High SpeedCommunications

Self-CorrectingLine SwitchingPHEVs

Energy Storage

Home Area Networks

Time to Market Scalability

Complexity

Low

High

2008 2013 2018

Intelligent Grid Technologies1

Note 1: Partial listing

24

Duke Energy’s SmartGrid program (U.S. utility)

Key Objectives

• Create a reliable and scalable networked infrastructure capable of delivering and receiving information from intelligent devices distributed across our power systems

• Automate components of the distribution systems

• Leverage the linked networks for improved operational efficiencies and customer satisfaction

• Provide the future platform for changing the customer experience and their use of energy in support of Duke’s Energy Efficiency programs

“A lasting and sustainable shift in the way we use electricity will require a ‘back of mind’ approach – where customers can take energy efficiency for granted, the same way they take for granted that the lights will come on when they flip a switch.” Jim Rogers, Duke Energy CEO

Size and Scope• 4.3M total electric and gas

customers• Five different regulatory jurisdictions• Full deployment by 2012-13

Steps Taken• Nearly 100k units deployed by end

of ’08• Combination of Powerline Carrier,

RF Mesh, and digital cellular communications platforms

• Fully, IP-based and open platforms• First full-scale, smart grid effort in

U.S.• Regulatory proceedings occurring in

IN and OH

25

CEMIG “Intelligrid” master plan (Brazil)

Key Objectives• Achieve technical and operational

excellence• Improve Distribution Network

reliability• Foster prudent investments, aligned

to long term planning• Reduce energy losses and

delinquency• Incorporate technological innovations

via Intelligrid concepts into current and new designs enterprise-wide

• Elaborate technical specifications for the application of the new technology and assist in bid evaluation and contract of pilot projects.

Size and Scope• Distribution network of over 367,000

kilometers (fourth largest in the world, >4% annual growth)

• 6.2M customers in the State of Minas Gerais (97% of population)

Steps Taken• Elaborated diagnosis on CEMIG

automation, protection, and measurement current situation

• Defined functional requirements• Developing cost-benefit analysis for

initial deployment• Preparing Automation, Protection,

and Measurement Master Plan• Developing RFI on

substation/distribution automation pilot projectsINTELLIGRID project: Architecture

that changes the technological level of the electricity system

26

PJM “Smart Grid Strategy” case study (U.S. grid operator)

Key Objectives

• Develop a strategy for operating an interconnected transmission system employing Smart Grid technologies

• Consider automation and system integration for transmission and distribution, with an emphasis on value-added services

• Analyze various scenarios of the electric utility business environment and what technology developments and RTO roles are favored or not favored under those scenarios.

• It also considers some environmental / technology developments that seem likely and which will require appropriate responses from RTOs

• Construct a framework to incorporate potential impacts from generation and facilitate industry growth

http://www2.pjm.com/documents/downloads/strategic-responses/appendices/appendix5-bgc-kema.pdf

27

However, implementation will be fraught with a number of key barriers

Interoperability and standards will be vital to full systems integration for smart grid components

There is a strong interest in enhanced levels of quality assurance for smart grid devices

With this increased connectivity, a number of security concerns are emerging

Regulatory acceptance and validation of the business case value

Consumer acceptance of the value proposition

Barrier to Smart Grid Acceptance

Barrier Description Stakeholder Activity

• Numerous industry working groups (e.g., GridWise, OpenAMI, OpenHAN)

• Federal focus – DOE, NIST, and FERC

• Several utilities performing deeper financial analysis and risk management

• Includes on-site audits and supplier assessments

• Need to avoid media over-generalization• funding criteria suggestions to DOE• AMI-SEC System Security Requirements

• Proceedings underway in numerous states, including IN, NY, and OH

• FERC-NARUC Smart Grid Collaborative

• Various consumer advocacy groups• National chains and large customer involvement

28

Interoperability and acceptable standards will be vital to full systems integration for smart grid components

Smart Grid relies on an end-to-end integration capability, but the many integration points (seams) lack commonly adopted standards

Web Services

SubstationAutomation

DistributionAutomation

Adv.Meters

DER

z

AMI CommsVar. Data Models

Var. Data Models

- Service Defs.- Event Defs.(XML / XTP)

CIM Data ModelsIEC 61968-70

NERC CIP requirements

IP, Open AMI

?

IEC 61850DNP 3.0

?

ANSIC12.19, C12.22

Customer Services

System Operations

Enterprise Systems

Others:• IEC 61000-3-X EMC• IEC 61400 Wind Turbines• IEC 62351PS Control and Assoc. Comm. - Data and Comm. Security• IEEE 1366 Distribution Reliability Indices• IEEE 802 LAN / WAN• C37.1-2007 SCADA 7 Automation Systems

HAN/ Bldg.

ControlsBACnet

LONWorksZigBee

WiFiHomeplugX10 PLC

IEEE 1547

29

Interoperability principles apply to multiple levels and policies, not just the technical layer

Source: GridWise Interoperability Context-Setting Framework, GridWise Architecture Council, March 2008

30Note 1: Example information from Duke Energy Indiana information (publicly available information from DE Indiana filing)

Summary Smart Grid Business Case (All values are 20-Year NPV in $ millions)

$(100)

$-

$100

$200

$300

$400

$500

$600

$700

$800$ (Millions)

Direct Expense Reductions

Increased Revenues

Costs

Qualitative Societal / Customer Benefits

Customer Outage Benefits

Avoided Costs

Utility Operational Benefits

Metering - $122.2Distribution - $8.1Outage - $8.1

$141.9$23.7

Other - $3.6

Metering - $21.3Outage - $1.7Other - $0.7

$206.1

Metering - $34.8Distribution - $171.3

$128.1

Capital Expenditures - $482.6

O&M Expenses $168.4

Taxes - ($95.0)

$555.9

Other Customer /

Societal Benefits

PHEV: $31.30

Customer Feedback: $442.86

$474.2Project NPV

$417.99(including customer /

societal benefits)

Includes impact of negative taxes

Regulators will require a sound financial analysis and projected return on investment

Customer Operational

BenefitsSocietal Benefits

31

KEMA’s experience has shown that select factors will enable greater Demand Response program effectiveness• Strong policymaker priority placed on demand response• Sufficient coordination between energy efficiency and

demand response program design and implementation• Simplified pricing options for policymakers and consumers

to compare/evaluate• Avoidance of default service rates that limit customer

exposure to time-differentiated rates and price transparency• Rates based on actual, rather than average, load profiles• Elimination or absence of retail/wholesale price caps• Appropriate incentives for emergency DR participation • Clarity and certainty around utility cost recovery and rate of

return incentives for DR investments• Consistency of interoperability and interconnection

requirements• Rules that facilitate access to meter data for non-utility DR

market participants

Demand Response is a

primary benefit for recovery of the Smart Grid/ AMI

investment

32

Regulators, in some cases, are also showing resistance to accept the benefits of smart grid or AMI

For some regulators, a compelling business case includes a greater

focus on societal benefits:

• Decreased customer costs due to improved outage management

• Improved environmental and health conditions• Better timed and better managed T&D system

upgrades• Lower overall wholesale market prices due to

increased load management efforts• Improved safety and reduced accidents due to

improvements in outage management/ response

The Energy Policy Act of 20051 established that: “Each State regulatory authority shall conduct an investigation and issue a decision on whether or not it is appropriate for electric utilities to provide and install time-based meters and communications devices for each of their customers”

Note 1: Section 1252 (b)(3)Note 2: Including Washington, DC

8No EPAct proceeding or activity

10Pending decisions/proceedings

22Rejecting EPAct directives

2Adopting modified EPAct directives

2Adopting EPAct directives

7Declared already in compliance

# States2U.S. EPAct Status

33

The Utility of the Future will require changes in the way utilities operate across several dimensions

Customer-defined and moving metrics

Regulatory-defined formulas and steady targets

Customer Satisfaction

Grow customer base

Increase to CapEx base

Market Growth

Dynamic environment –regular appearances and merging of partners and competitors

Closed regulatory eco-system

Market Environment

Several monthsMany yearsProduct Life Cycle

Service-driven revenues

Average cost-based commodity pricing

Revenue Model

Niche of one customization

Standard offeringsProduct Offerings

Utility of the Future

Utility of TodayDimension

Today vs. Tomorrow• Current utility-driven total solution and

systems integration will morph into a more complex integration of multiple technologies

• Utility-provided, long-term financing for capital intensive transmission and distribution (T&D) infrastructure remains the same, but the utility will also have to manage technology obsolescence for the customer

• The utility manages the supply chain for customer value, but customer value is defined more broadly than before

• The utility “obligation to serve”becomes an obligation to offer solutions to all classes of customers

34

Key success factors for the Utility of the Future• Manage the process of organization change: align leadership and employees• Product Management requires implementing “game changing” products and business models

– Seeking increased market share via identification of, and exceeding, unserved customer needs

– Anticipating, driving, and exploiting technology change• Time to Market – Minimize the product development cycle• Exploit the Internet and Disintermediation – Leveling the playing field from new entrants and lower-capitalized start-ups with new technology offerings

• Democratic Innovation – Seeking greater customer-driven advances• Niches of One – Customization of products and service offerings• Operational Excellence – Defined by customer expectations, rather than regulatory requirements

• Right Business Model - Effective supply chain management and perhaps outsourcing non-critical everything

• Brand Management and Positioning – Knowing how well the brand stands up against incumbents from other industries, such as Google, Cisco, Home Depot and Sears

35

Discussion Topics

• What is the “Smart Grid” vision?

• How Generation, Transmission and Distribution Work Together In a Smart Grid Scenario




36

Energy Markets

SmartGeneration

SmartGeneration

CentralizedCentralized DistributedDistributed

IntermittentIntermittent

Critical / Backup

Critical / Backup

SmartGrid

SmartGrid

SmartEnd UseSmart

End Use

TransmissionTransmission DistributionDistribution

InformationSystems

InformationSystems

AssetManagement

AssetManagement

Grid Monitoring

Grid Monitoring

Grid Automation

Grid Automation

EnterpriseIntegrationEnterpriseIntegration

BaseloadBaseload

PeakingPeaking

GreenPowerGreenPower

Commercial/Industrial

Commercial/Industrial ResidentialResidential

Smart Motors& Devices

Smart Motors& Devices Smart

AppliancesSmart

Appliances

BuildingAutomation

BuildingAutomation

PhotovoltaicPhotovoltaic

Plug -in HybridsPlug -in Hybrids

Advanced Metering

Advanced Metering

Site EnergyMgmt Systems


DemandResponseDemand

Response

DistributionOperations


PowerElectronics

PowerElectronics

SmartStorageSmart

Storage

Communication& Control


TransmissionOperations


Smart Dist. Devices

Smart Dist. Devices

SmartGeneration

SmartGeneration

CentralizedCentralized DistributedDistributed

IntermittentIntermittent

Critical / Backup

Critical / Backup

SmartGrid

SmartGrid

SmartEnd UseSmart

End Use

TransmissionTransmission DistributionDistribution

InformationSystems

InformationSystems

AssetManagement

AssetManagement

Grid Monitoring

Grid Monitoring

Grid Automation

Grid Automation

EnterpriseIntegrationEnterpriseIntegration

BaseloadBaseload

PeakingPeaking

GreenPowerGreenPower

Commercial/Industrial

Commercial/Industrial ResidentialResidential

Smart Motors& Devices

Smart Motors& Devices Smart

AppliancesSmart

Appliances

BuildingAutomation

BuildingAutomation

PhotovoltaicPhotovoltaic

Plug -in HybridsPlug -in Hybrids

Advanced Metering

Advanced Metering



DemandResponseDemand

Response



PowerElectronics

PowerElectronics

SmartStorageSmart

Storage





Smart Dist. Devices

Smart Dist. Devices

Energy Markets

Irrespective of the scope of these individual elements, a robust view of UoF should include the influences of both producers and consumers

Source: Global Environment Fund and The Center for Smart Energy

The Smart Grid concept has no clear universal definition, particularly as the boundaries vary among individual users

37

Distribution SubstationStep-down Transformer

CustomerStep-down Transformer

Load

Distribution Lines4,160, 12,500, 24,000 Volts

Metering and Sensing DevicesMetering and sensing devices will deliver information along a digital

communication infrastructure.

Data Collection and TransmissionNodes along the distribution lines will collect data about the system and communicate to the operations center in real time across a digital communication infrastructure

Digital Communication Infrastructure

The communication system will provide a mechanism for transmitting data, controlling and automating multiple devices along the distribution path, including applications behind the meter

Innovations at the TransformerThe transformer will support various endpoint measurement an control,

including potential metering advances.

Utility of the Future OverviewCreating A Digital Grid

38

Smart Grid deployment will also require an end-to-end operational view

• Individual technologies and enablers are critical components - e.g., high-bandwidth, secure, and two-way communications infrastructure

• However, real benefits will be achieved by society when considering the end-to-end impact and integration across the utility enterprise, as well as its interface to the consumers

39

The UoF will operate as an Intelligent Network, with a portfolio of technologies and advanced communications

Source: International Energy Agency (Vigotti)

40

This will, in turn, drive the development of new generation technologies and products

Mini- and micro turbines

Smart power electronics

Convenience & health

41

Discussion Topics






42

Timeline of Control Center Technologies

Smart GridSynchrophasorsRenewablesConsumer EnablementElectric Vehicles

--- ?????? ---

CARBONSUSTAINABILITY

Drivers

Technologies

1950 1960 1970 1980 1990 2000 2010 2020

Interconnection

Growth

Larger Plants

Analog LFC

Analog EDC

Electro-Mechanical SCADA

Digital Process Control

Nodal Iterative

1965 BLACKOUT

State EstimationAC Contingency AnalysisUnit commitmentTraining simulatorsBeginning of ICCPMainframesPSSE

TMI

1977 NY Blackout

Nuclear Winter

Entry of Defense Firms

---The Golden Age---

EPRI

CADPADCADOPSFull GraphicsCIM

DeregulationCEGBNorwayCaliforniaFERC SMD

OPF and SCUC for MarketsSOA and Web ArchitecturesVendor consolidation

Y2K

2003

BLACKOUT

GMS

Trading

Substation Automation

GOOGLE

Google EarthPower MeterEV

43

Next Decade Will Be Revolutionary• Applications enabled by new sensors (PMUs, etc)

• Renewables (including storage)

• DG integration

• PHEV integration

• Calls for new solutions

– Higher dimensionality; volatility and uncertainty;

and new possibilities /constraints

• Increasing standardization (NIST)

44

SMART GRID GAPS TODAY

Hydroelectric

Wind Farm

Home Office

Residential

EV

MotorsIndustrial

Micro Grid Commercial HVAC Building EMS

DECREASEDSTABILITY & INCREASED VARIABILITY

RENEWABLES ARE NOT DISPATCHABLE

SMART ASSETS NOT EXPLOITED

PV IS INVISIBLE TO GRID

CARS & DG BEHIND THE METER FACE 2-WAY METERING LIMITATIONS

2-WAY METERING LIMITATIONSDR = THERMOSTAT SETBACKNO DYNAMIC PRICING

CONGESTEDAGING & COSTLY

CUSTOMERS DO NOT SEE PEAK COSTS AND CANNOT USE INFORMATION TO REDUCE ENERGY CONSUMPTION / COSTS

SCADA

SER

IAL

CO

MM

UN

ICA

TIO

NS {PLANNING

GISOUTAGEASSET MANAGEMENTWORK MANAGEMENT

UNDERGROUND SECONDARY NETWORK -NO VISIBILITYOR CONTROLBEYOND VAULT

Power Transformer

Storage

Bus Work Medium Power Transformers

Circuit Breakers

URD

Feeder Circuits

Reclosers

Regulators

PILOTS ONLY TODAYG, T, D, OR ALIEN?

ENGINEERED FOR RADIAL FLOW

NOT ADAPTIVE OR SELF HEALING

RA

DIA

L FLOW

NOT PROGRAMMED FOR HIGH RPS AND NOT ADAPTIVE

SCADA RTU

GENERATION

AREA SUBSTATION

Distributed Generation

Fossil

ISLANDS of AUTOMATION

EM meteror

1-way AMR

Distributed Renewables not Visible

Renewables do NOT Participate in

Operations and MarketsCustomer Data not

Factored into Operations and Markets

AGING DUMB ASSETSIED INTELLIGENCE NOT UTILIZED

TRANSMISSION

SUBSTATION

DISTRIBUTION

DR SIGNAL

BUILDING AUTOMATION

REVENUE METER

MONTHLYSETTLEMENTS

Market and Grid Operations

ISO

ONE NETWORK CAN ONLY BE FED FROM ONE AREA SUBSTATION

Nuclear

INCREASED CONGESTION

SPECIAL PURPOSE SERIAL COMMUNICATIONS FOR OPERATIONS

INTERNET BASED MARKET OPERATIONS

45

FUTURE SMART GRID VISION

Hydroelectric

Wind Farm

Home Office

MotorsIndustrial

Micro GridCommercial

HVAC Building EMS

STABILITY IMPROVED VIA SYNTHETIC INERTIA AND GOVERNOR RESPONSE UNDER PMU CONTROL

RENEWABLES ARE DISPATCHABLE

FEED IN TARIFFS &DYNAMIC PRICING

CONGESTION RELIEVED BY FACTS AND OTHER DEVICES

CUSTOMERS SEE PEAK COSTS AND CAN USE INFORMATION TO REDUCE ENERGY CONSUMPTION / COSTS

SMART GRID COMMS PROVIDE NETWORK VISIBILITY AND CONTROL

Power Transformer

Storage

Bus Work Medium Power Transformers

Circuit Breakers

URD

Feeder Circuits

Reclosers

Regulators

Substation Computer

STORAGE USED FOR DIURNAL ENERGY SHIFTING AND RELIABILITY

ADAPTIVE & SELF HEALING

BID

IREC

TIO

NA

L FL

OW

IED NON-OPERATIONAL DATA INTEGRATED WITH SUBSTATION COMPUTER

GENERATION

AREA SUBSTATION

Distributed Generation

Fossil

RENEWABLES & CUSTOMERS

PARTICIPATE IN MARKETS AND GRID

OPERATIONS

PHASOR MEASUREMENTS USED TO ENHANCE

STABILITY AND RELIABILITY

STORAGE USED TO AUGMENT RENEWABLES

ADVANCED TRANSMISSION

(ATO)

SUBSTATION

ADVANCED DISTRIBUTION OPERATIONS

(ADO)

SMART GRID COMMUNICATIONS & BUILDING TO GRID

BUILDING AUTOMATION

DAILYSETTLEMENTS

REVENUE METER

ISO ANALYTICS DEAL WITH VARIABILITY AND STOCHASTIC

AM

I CO

MM

UN

ICA

TIO

NS

PMUs & FCLs ENHANCE RELIABILITY & FLEXIBILITY

Integrated Communications

Networks

Displays

Appliances

AMI Meter

AMI Meter

AMI Meter

AMI Meter

COMMUNITY STORAGE

ENGINEERED FOR BI-DIRECTIONAL FLOW

ADVANCED METERING INFRASTRUCTURE (AMI)

ADVANCED METERING INFRASTRUCTURE (AMI)

ELECTRIC VEHICLES AUTONOMOUSLY RESPOND TO PRICES AND PROVIDE V2G SERVICES

46

High Speed Monitoring and Control of Grid to Enhance System Stability and Robustness

• Synchrophasors and high speed wide area networks

• Integrated control of high speed system resources (inverter based renewables and large scale fast grid connected storage)

High Speed Grid Reliability EnhancementVision

• Grid dynamics under high RPSo Definitive studies on stability impacts of high

RPS levelso Control algorithms and technologies to utilize

high speed resources for stabilizationo Analysis of where to deploy high speed

resourceso Visualization concepts and technologieso New algorithms for dynamic grid control and

stabilization

Research & DevelopmentIssue

Technologies

• High RPS alters system dynamics in a fundamental way, especially when fewer conventional generators are on lineo lack of inertia and governor response,

different excitation; different locations of renewables.

47

Renewables and Dynamic PerformanceVision

• Power electronics and control algorithms to achieve synthetic excitation stabilization, inertia, governor response

• System performance under high RPSo With and without dynamic

performanceo Integration with wide area PMU based

stability augmentation


Technologies

Renewables provide dynamic performance to assist in system stability and control

• Power electronics and control algorithmso Synthetic voltage dynamics,

governor response, inertia

• Inverter electronics lack inertia, governor response, excitation control for stability

48

• Modeling and analysis to determine how much storage is required/necessary to support renewable goals

• What role will storage play in helping achieve zero net energy residential and commercial new construction goals

• What are appropriate regulatory, market, and incentive treatments to encourage storage in support of renewables?

• Identifying the control technologies and algorithms necessary toensure storage can seamlessly work with Wind, Grid requirements when integrating renewables to the electricity grid

• Continued investigation of emission benefits of storage technologies – i.e. Commercial & Industrial uses

• When storage is used in a multi-purpose application (as at a substation) how to allocate costs and benefits for cost recovery?

Storage is located throughout the electric infrastructure to support renewables penetration in terms of reliability, economics,

operations, and deferred capital. Appropriate storage technologies are integrated in light of applications.

Electricity StorageVision

Research & Development

Technologies

Regulatory Treatment of Storage & Asset Classification

Matching Technologies to Applications

Deployment and Control Strategies Linked to Renewables

Issue

Market and Operations Analysis and Simulation

Existing and Developing Storage Technologies, Capabilities, and Economics

49

• Renewable controllability/renewables and storage• Demonstrating residential solar-storage

applications and testing of dispatchable, guaranteed responses.

• Low cost communications and control• Market protocols for forecasting, scheduling,

integration and capacity, metering standards• Metering strategies and tariff structures that will

facilitate increased penetration of renewables, enhanced DR capability and improved ability to achieve zero net energy goals

• Demand forecasting and elasticity R&D

Distributed renewables are dispatchable to provide system operations flexibility and are capable of participating in energy markets; allocation of costs and benefits

(especially capital deferral) reflects the full value of renewable resources to the grid

Distributed Renewable ResourcesVision

Research & DevelopmentIssues

Technologies

• Storage – DG configurations• Utilizing internet – Wifi for transferring

energy information and energy management

• IEDs• Next Generation inverters• HAN and BAS with integrated demand

response

• Requirement needs for dispatchable DG

• Communications• Controls

• Tariff structures• Metering• Integrating

advanced inverters

50

Advanced Asset ManagementVision


Technologies

• Retrofit of Sensors • Liability Issues

• Asset Data Bases

Advanced Sensors Provide Detailed Asset Health Information –condition based maintenance and risk based outage scheduling

become routine

• Sensors

• Enterprise Substation Integration

• Asset Portfolio Optimization

• Sensors

• Asset Performance Prediction

• Probabilistic Outage Scheduling and Congestion Cost Analysis

51

• Current engineering, protection, and operations are non-adaptive and provide for radial flows only

Distribution circuits capable of supporting high RPS will require adaptive protection, automation and the possibility for bidirectional

flows and ability to adapt to high variability

Flexible Distribution CircuitsVision

• Cost benefit analysis of bidirectional flow• Analytics for planning and operations• Software upgrades to field devices (IEDs)• Communications


Technologies

• Distribution automation• Intelligent Electronic Devices• Substation automation• Stochastic circuit analysis for

planning and operation

52

• Econometrics and forecasting• Market structures and mechanisms• Elasticity metrics• Optimization strategies• Time Variant pricing strategies to harness

power of distributed generation resources• Uniform definitions of device object and

attributes and binding rules

Building Automation Systems (BAS) in commercial buildings and residential Home Area Network (HAN) systems can interact with

hourly prices to create demand price elasticity in the markets

Price Responsive Load(Dynamic Pricing or Time Variant Pricing)

Vision


Technologies

• Internet• Device Networking• Local optimization devices

• Lack of market protocols• Difficulties in forecasting• Lack of BAS / HAN applications support• Communications and Settlements• Rate Structures• Device Compatibility and Interoperability

53

• Econometrics and forecasting• Market structures and mechanisms• Optimization strategies• Time Variant pricing strategies to harness

power of distributed generation resources• Uniform definitions of Use Cases,

Interoperability Standards

Vehicle charging controlled to optimize market and reliability goals consistent with transportation / owner requirements. Vehicle storage offers time-energy shifting and grid ancillary services

Electric Vehicle – Grid Integration (V2G)Vision


Technologies

• Internet• Device Networking• i-Phone on Wheels• Vehicle Metrology

• Lack of market protocols• Difficulties in forecasting• Communications and Settlements• Rate Structures• Device Compatibility and

Interoperability• Early Vehicle capabilities

54

• Vehicle metrology and applications• Market/rate structures• Separate settlements process

PHEV and EV owners can enroll in green charging that matches vehicle charging to specific renewable power production and obtain incentives,

RECs and tariffs that facilitate enhanced renewable penetration

Green ChargingVision


Technologies

• Wireless Internet and GPS• Metering on vehicles• Cloud computing• HAN with integrated demand response

• PHEV and EV load is behind the meter• Currently no separate measurement and

control• PHEV and EV mobility• Back office billing and settlement

55

Phasor Measurement Units offer greater visibility into grid system operations and assessment

• Traditional SCADA has provided sufficient operational data (e.g., bus voltages; line, generator, and transformer flows) every 2 to 4 seconds, offering a steady state view into the power system behavior

• With Phasor technology and Phasor Measurement Units (PMU), we now have additional information on:

– voltage & current phase angles (monitor angle-of-separation)

– frequency rate-of-change (identify generation loss)

• PMU data are time-synchronized and taken many times a second (e.g., 30 samples/second) offering a dynamic visibility into the power system behavior, as well as fine-tuning dynamic models

Vision...The vision of the North American

SynchroPhasor Initiative is to improve power system reliability through wide-area measurement, monitoring and

control.

Sponsored by Pacific Northwest National Laboratory, Operated by Battelle for the U.S.

Department of Energy

http://www.naspi.org/

56

Industry Initiatives• CIGRE D2.24 Working Group (EMS Architectures for

the 21st Century)– Initially started in 2007, by the Very Large Power Grid Operators (VLPGO)

organization.

– The goal of this working group is to develop a modern the architecture for

Energy Management Systems (EMS) and Market Management Systems

(MMS) based on Service Oriented Architectures (SOA).

– Aligned with IEC Technical Committee 57 (TC57).

– Leverages other IEC standards including IEC 61970/61968 - the Common

Information Model (CIM).

57

D2.24 Business Goals• Lowered Total Cost of Ownership

• Improved Business Continuity

• More Effective User Interface

• Higher Reliance on Industry Standards

• Reduced Dependence on Proprietary Platforms

• Higher Level of Interoperability

• Increased Reuse of Software Components

• Modernization of the Architecture

58

Focus on Interoperability• The architecture endeavors to exhibit the

characteristics and attributes of interoperability as defined in GridWise Architecture council’s interoperability checklist including:– Open architecture– Technology neutrality– Multiple vendor competition and innovation– Open standards based– Interface point specifications– Mission critical redundancy– Cyber-security

59

Discussion Topics






60

Renewable installations are now growing at a significant annual rate

Note: Biomass includes waste sources (e.g., landfill gas) as well as wood and derived fuels

Source: Energy Information Agency, http://www.eia.doe.gov/cneaf/alternate/page/renew_energy_consump/table4.html; Renewable Energy Databook, U.S. DOE

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2003 2004 2005 2006 2007

Wind Solar/PV Biomass Geothermal

U.S. Renewable Energy Nameplate Capacity Additions(excluding hydropower or capacity reductions)

Market Trends

• Renewables represent nearly 11% of the total U.S. generating summer capacity

• Growth is primarily driven by wind and solar – 2001 to 2007 CAGRs include:

– Wind = 30.7%– Solar/PV = 29.5%– Concentrating Solar = 2.4%– Biomass = 1.4% – Geothermal = 0.7%

• In 2007, renewable energy accounted for over 35% of all new capacity installations in the U.S.

61

Renewable Portfolio Standards will also have a profound impact to overall grid planning and smart grid investments

RPS Challenges to the Grid

• Timeliness of transmission siting and permitting requirements, relative to energy supply deployment

• Sufficient modeling of intermittent supply capability and reliability

• Equity treatment of line extension capital requirements between transmission owner vs. energy suppliers

Less than 10%10 to 20%

RPS Target

More than 20% Note: MO, ND, SD, UT,, and VA are voluntary State goals, rather than mandatory RPS targetsSource: Database of State Incentives for Renewables & Efficiency, www.dsireusa.org, Pew CenterOn Global Climate Change www.pewclimate.org

State Status of RPS (October 2008)

62

Green House Gas legislation is a potential game-changer and will be more likely to pass in the Obama administration

Note 1: GHGs include: carbon dioxide, methane, nitrous oxide, ozone, and CFCsNote 2: Levels below “business as usual”Source: KEMA research and analysis, EEI Electric Perspectives, June 2008

“Electric Utility Cap

and Trade Act”

“American Climate

Security Act”

“Low Carbon Economy

Act”

“Climate MATTERS

Act”

“Global Warming

Reduction Act”

“Global Warming

Pollution Reduction

Act”

Name

Low25%/ 45%ElectricFeinstein-Carper (S.317)

High30%/ 50%All GHGsBoxer -Lieberman-Warner (S.2191)

Low7.6/ 21.9%

All GHGsBingaman-Specter (S.1766)

Low42%/61%All GHGsDoggett (HR.6316)

Low42%/ 61%All GHGsKerry-Snowe(S.485)

Low42%/ 63%All GHGsSanders-Boxer(S. 309)

Passage Potential

2020/ 2030 Cap2

Scope1Proposed Act

Key Issues

• President Obama favors GHG legislation

• Cap-and-trade has majority support over tax-based plans

• Bill strength hinges on U.S. Senate Democrats, who favor stronger measures

• Will require equitable treatment on initial cap allocations and “grandfathering” of controls

• Also need sufficient market controls for cap trading

63

Why Renewable Generation (Wind, etc.)?• Fastest growing source of power generation• Widely supported as a means to reduce the

dependency on petroleum• Accepted and subsidized by state and national

governments• Exhibits different characteristics than traditional

power stations

64

Wind Generation - different characteristics• Wind (fuel) is intermittent (availability component)• Wind generator are rarely a direct connected synchronous

generator (inertia component) • Wind generators – may not always be available to participate in

primary or secondary frequency control (marginal cost and wind speed components)

• Some wind generators (earlier versions):– Can not provide reactive power or static/dynamic voltage

control– Did not have the capability to remain on-line through a voltage

dip• Dynamic stability may deteriorate as the total percentage of power

from wind resources increase (wind generators may be able to respond quicker)

• Advances in power electronics (e.g., SVCs, STATCOMs) and storage helps to mitigate these differences

65

Why is Storage being made an integral issue for Smart Grids and Renewables?• Storage is now considered a tool and

component of Smart Grid— Chart shows where storage is being utilized in

smart grids

• What type of applications is storage being applied to?— Integration of Renewables into Grid can

help maintain grid operations with large percentages of wind on the grid

(ramping – diurnal problems)

— Ancillary Services Fast response capabilities allow devices to perform better than current devices

(Increased need for regulation)

— PHEVs – Convergence of Electric & Automotive Industries

(can aggregation solve problems)

State Goal

☼ PA: 18%** by 2020

☼ NJ: 22.5% by 2021

CT: 23% by 2020

WI: requirement varies by utility; 10% by 2015 goal

IA: 105 MW

MN: 25% by 2025(Xcel: 30% by 2020)

TX: 5,880 MW by 2015

☼ AZ: 15% by 2025

CA: 20% by 2010

☼ *NV: 20% by 2015

ME: 30% by 200010% by 2017 - new RE

State RPSHI: 20% by 2020

RI: 16% by 2020

☼ CO: 20% by 2020 (IOUs)*10% by 2020 (co-ops & large munis)

☼ DC: 20% by 2020

☼ NY: 24% by 2013

MT: 15% by 2015

IL: 25% by 2025

VT: (1) RE meets any increase in retail sales by 2012;

(2) 20% RE & CHP by 2017

☼ MD: 20% by 2022

☼ NH: 23.8% in 2025

OR: 25% by 2025 (large utilities)5% - 10% by 2025 (smaller utilities)

*VA: 12% by 2022

☼ *DE: 20% by 2019

☼ NM: 20% by 2020 (IOUs)10% by 2020 (co-ops)

☼ NC: 12.5% by 2021 (IOUs)10% by 2018 (co-ops & munis)

ND: 10% by 2015

SD: 10% by 2015

*UT: 20% by 2025☼ OH: 25%** by 2025

*MI: 10% + 1,100 MW by 2015

☼ MA: 15% by 2020+ 1% annual increase(Class I Renewables)

☼ MO: 15% by 2021

*WA: 15% by 2020

66

Storage can provide the answer, but work still remains

• Storage is the answer for renewable integration...

...but questions do remain on whether it will be ready for the expected increases in renewable generation

• Why is Storage an answer?— Low emission technology that, with some technologies, can be sited quickly and in a

“distributed” fashion

— Alternative to traditional fossil generation plants thus preventing the renewable integration needs from increasing emissions

For regulation, this may be a significant issue

• Multiple MWs are going to be required to match the Renewable Policy Goals— Can the technologies be produced fast enough?

67

Discussion Topics






68

With this increased connectivity, a number of security concerns are emerging, with potentially significant implications

AMI Meter

Utility Back Office

Utility Substation

Customer Premise

Remote Access

Smart Grid/ AMI System

Vulnerabilities• Unprotected access to

cust. and utility systems• Inadequate anti-virus

protection• Insufficient disaster

recovery plans• Lack of security policy,

procedures or training• Single instance or chain-

of-events that impacts ability to perform

Threats• Sabotage, hacking, theft,

assaults• Floods, hurricane,

earthquakes• Unintentional “Denial of

Service”

Security Implications

• Asset/ capital preservation• Liabilities for claims and

injuries • Lost or misreported revenue• Unanticipated

consequences of compromised commands

• Regulatory certainty for sensitive customer data

• Grid reliability and system performance

• Media or public scrutiny on potential weaknessesPrivacy Protection Laws/Regulations

• State regulatory rules on confidentiality of utility bills, usage and payment records

• Federal legislation includes Sarbanes-Oxley internal control structures and reporting for financial reporting

• Miscellaneous state legislation on data privacy protection

69

One of the areas of greatest focus will seek to further progress on interoperability standards & security measures

Selected Smart Grid Working Groups– Standards Development Organizations (e.g.,

ANSI)– GridWise Architecture Council– GridWise Alliance – Interoperability Work

Group– OpenAMI– OpenHAN– UtilityAMI– Open Smart Grid– Enterprise AMI– Edison Electric Institute– National Electrical Manufacturers Association– OpenDR– AMI-SEC– CIM Modeling group

“Well-designed standards and protocols are needed to make Smart Grid areality. DOE, NIST and FERC have been working with each other and with other Federal agencies to ensure progress, and those efforts will continue.”1

U.S. Department of Energy (DOE)

National Institute of Standards and Technology (NIST)

Federal Energy Regulatory Commission (FERC)

• Managing smart grid grants• Developing/operating smart grid

clearinghouse

• Coordinating framework development• Making recommendations to FERC

• Implementing smart grid interoperability standards

Note 1: Testimony of FERC Commissioner Suedeen G. Kelly, before the Committee on Energy and Natural Resources,United States Senate, March 3, 2009

70

One industry organization seeking to address security concerns is AMI-SEC

AMI-SEC Task Force– Composed of utility and vendor

participants

– Mission: Develop technical specifications for utilities and device manufacturers to address AMI security vulnerabilities

– AMI-SEC will produce the process by which a vendor can certify a device as a “UtilityAMICompliant Security Device”

AMI

ThirdParty

Customer Utility

Entities which interact with AMI meters: customers, utilities, and third parties such as contractors or other meters.

AMI-SEC’s mission is to determine how this interaction is managed securely

71

AMI-SEC’s process goals are already articulated• Protect all Smart Grid services from malicious attack and unintended adverse cyber and

physical events that threaten the mission of the service (i.e., security events)

• Ensure that sufficient information about a security event is available when and where it is needed to support the decision making necessary to protect the mission of the affected Smart Grid service

• Ensure the integrity, availability, and the confidentiality of the security and survivability services and mechanisms used to protect the Smart Grid services

• Prevent security events associated with a Smart Grid service from contributing to or complicating the safety and protection of personnel, stakeholders, and stakeholder services, and the electrical system

• Do not allow any Smart Grid service or its associated technology (e.g., communications networks and gateways) to be used as a stepping stone or conduit for attacks (or amplifying the effects of attacks) on other Smart Grid services, end users, external service providers (e.g., cell phone networks, ISPs), or any other interconnected entity

• Smart Grid services shall not amplify the adverse effects of any accident, natural disaster, or human error

• Provide sufficient evidence to support the assurance of justifiable confidence (i.e., trust) in the integrity, confidentiality, and availability of Smart Grid services

72

Let’s Not Forget About the NERC CIP Requirements

• Unlike the new standards that will be required to ensure the security of the electric grid as a

result of the implementation of the Smart Grid and smart devices, the NERC CIP standards,

and the NERC 1200 requirements before them, have been with us for over 5 years.

• The NERC CIP requirements are targeted at protecting cyber assets where the loss of those

assets has the potential to impact the Bulk Electric System (BES) as defined by NERC

• CIP-002 through CIP-009 provide a cyber security framework for the identification and

protection of critical cyber assets that are critical to the reliable operation of the BES.

• Based on previous security research from the National Institute of Standards and Technology

(NIST), which has been working closely with NSA and the Department of Defense for many

years in this area.

73

CRITICAL CYBER ASSETS

CRITICAL CYBER ASSETS

SECURITY MANAGEMENT

CONTROLS

SECURITY MANAGEMENT

CONTROLSPERSONNEL

AND TRAINING

PERSONNEL AND TRAINING ELECTRONIC

SECURITY

ELECTRONIC SECURITY PHYSICAL

SECURITY

PHYSICAL SECURITY

SYSTEMS SECURITY

MANAGEMENT

SYSTEMS SECURITY

MANAGEMENT

INCIDENT REPORTING &

RESPONSE PLANNING

INCIDENT REPORTING &

RESPONSE PLANNING

CIP-002 CIP-003 CIP-004 CIP-005 CIP-006 CIP-007 CIP-008 CIP-009

1. PLAN

2. PHYSICAL ACCESS CONTROLS

3. MONITORING PHYSICAL ACCESS

4. LOGGING PHYSICAL ACCESS

5. ACCESS LOG RETENTION

6. MAINTE-NANCE & TESTING

1. PLAN

2. PHYSICAL ACCESS CONTROLS

3. MONITORING PHYSICAL ACCESS

4. LOGGING PHYSICAL ACCESS

5. ACCESS LOG RETENTION

6. MAINTE-NANCE & TESTING

1.TEST PROCEDURES

2. PORTS & SERVICES

3. SECURITY PATCH MANAGEMENT

4. MALICIOUS SOFTWARE PREVENTION

5. ACCOUNT MANAGEMENT

6. SECURITY STATUS MONITORING

7. DISPOSAL OR REDEPLOY-MENT

8. CYBER VULNERABILITY ASSESSMENT

9. DOCUMEN-TATION

1.TEST PROCEDURES

2. PORTS & SERVICES

3. SECURITY PATCH MANAGEMENT

4. MALICIOUS SOFTWARE PREVENTION

5. ACCOUNT MANAGEMENT

6. SECURITY STATUS MONITORING

7. DISPOSAL OR REDEPLOY-MENT

8. CYBER VULNERABILITY ASSESSMENT

9. DOCUMEN-TATION

1. CYBER SECURITY INCIDENT RESPONSE PLAN

2. DOCUMEN-TATION

1. CYBER SECURITY INCIDENT RESPONSE PLAN

2. DOCUMEN-TATION

1. CRITICAL ASSETS

2. CRITICAL CYBER ASSETS

3. ANNUAL REVIEW

4. ANNUAL APPROVAL

1. CRITICAL ASSETS

2. CRITICAL CYBER ASSETS

3. ANNUAL REVIEW

4. ANNUAL APPROVAL

1. ELECTRONIC SECURITY PERIMETER

2. ELECTRONIC ACCESS CONTROLS

3. MONITORING ELECTRONIC ACCESS

4. CYBER VULNER-ABILITY ASSESSMENT

5. DOCUMEN-TATION

1. ELECTRONIC SECURITY PERIMETER

2. ELECTRONIC ACCESS CONTROLS

3. MONITORING ELECTRONIC ACCESS

4. CYBER VULNER-ABILITY ASSESSMENT

5. DOCUMEN-TATION

1. AWARENESS

2. TRAINING

3. PERSONNEL RISK ASSESSMENT

4. ACCESS

1. AWARENESS

2. TRAINING

3. PERSONNEL RISK ASSESSMENT

4. ACCESS

1. CYBER SECURITY POLICY

2. LEADERSHIP

3. EXCEPTIONS

4. INFORMATION PROTECTION

5. ACCESS CONTROL

6. CHANGE CONTROL

1. CYBER SECURITY POLICY

2. LEADERSHIP

3. EXCEPTIONS

4. INFORMATION PROTECTION

5. ACCESS CONTROL

6. CHANGE CONTROL

RECOVERY PLANS FOR

CCA

RECOVERY PLANS FOR

CCA

1. RECOVERY PLANS

2. EXERCISES

3. CHANGE CONTROL

4. BACKUP & RESTORE

5. TESTING BACKUP MEDIA

1. RECOVERY PLANS

2. EXERCISES

3. CHANGE CONTROL

4. BACKUP & RESTORE

5. TESTING BACKUP MEDIA

NERC CIP 002 - 009

Experience you can trust.

Thank you for your time.

Will McNamara & John Holt

the utility of the future a - kema uof.pdf · 2009. 9. 11. · 4 the smart grid movement is well...

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