EnergyAustralia to lead Smart Grid, Smart City project
With the Federal Government’s $100 million Smart Grid, Smart City winning bid now revealed, Energy Source & Distribution talks to industry experts about smart grid infrastructure and investment.
The Federal Government selected a consortium lead by EnergyAustralia to implement the $100 million Smart Grid, Smart City bid in June.
The Smart Grid, Smart City bid will lead to groundbreaking changes to the country’s energy industry, according to EnergyAustralia managing director, George Maltabarow.
Mr Maltabarow said the funding would allow a commercial-scale smart grid to be rolled out across five sites in Sydney and the Hunter Valley.
“Building a smart grid on such a large scale will keep Australia at the forefront of energy technology,” Mr Maltabarow said.
“This trial will showcase the future of electricity networks in Australia, including self-healing when faults and interruptions occur and greater customer control.”
Consortium participants working with EnergyAustralia include the CSIRO, IBM Australia, AGL, GE Energy, TransGrid, Newcastle City Council and the NSW government.
Climate Change, Energy Efficiency and Water Minister, Penny Wong said smart grids have enormous potential to improve the efficiency of the electricity sector and transform the way energy is used.
“If smart grid applications are adopted around Australia they could deliver a reduction of 3.5 Mt of carbon emissions per annum,” Minister Wong said.
The Energy Networks Association (ENA) chief executive, Andrew Blyth, congratulated EnergyAustralia on their winning bid.
“The Smart Grid, Smart City project is a positive step in helping Australia move towards a smarter and more energy efficient network and ENA is pleased that EnergyAustralia has been selected to lead this important program,” Mr Blyth said.
“This demonstration project will provide industry with important information on the costs and benefits of smart grid technologies and how they can be used to effectively integrate renewable energy sources as well as improve energy efficiency, quality and reliability.”
New generation smart meters will be rolled out to 50,000 homes at five sites in Newcastle, Scone, the Sydney CBD, Ku-ring-gai and Newington. Around 15,000 households will become ‘smart homes’ to trial a new breed of in-house displays and websites that track electricity and water use, costs and CO2 emissions.
These homes will test remote control of appliances including air conditioners and innovative pricing packages to help reduce energy use and greenhouse gas emissions.
“Households in Scone will become virtual green power stations in battery storage trials, allowing them to help power local streets,” Mr Maltabarow said.
The rollout of 12,000 smart sensors across EnergyAustralia’s electricity network will be fast-tracked to allow earlier fault detection and repair, including self-healing of some faults.
“Renewable energy and battery storage trials will see power generated locally in buildings in Sydney’s CBD and Sydney City Council’s fleet of 20 electric vehicles will test battery storage and smart charging points,” he said.
“A second electric vehicle fleet will be tested and special charging stations built in public areas to test how electric cars can be charged from multiple locations on the grid.”
EnergyAustralia’s plan includes the trial of new technology to help test the National Broadband Network roll out.
“I would also like to acknowledge that the vast majority of ENA’s member companies are actively progressing the concept of smart networks (smart grids) throughout their businesses,” Mr Blyth said.
“ENA members realise that smart networks are essential to allow for the more efficient use, delivery and consumption of power throughout Australia. Importantly, smart networks also equip consumers with the information and tools needed to improve energy usage in homes and businesses.”
ENA is expecting to hold a Smart Networks Summit in conjunction with EnergyAustralia in March 2011, which will also allow for a presentation on the details and progress of the Smart Grid, Smart City project.
Sharing the load
By Geoff Lilliss, EnergyAustralia Engineering, Transmission and Technology General Manager
Energy Source & Distribution talks to EnergyAustralia’s executive general manager, engineering, transmission and technology, Geoff Lilliss about Smart Grid, Smart City’s significance.
The culmination of “a lot of incredible effort”, the Smart Grid, Smart City program will be a significant opportunity for EnergyAustralia to work with the industry, according to general manager Geoff Lilliss.
“I think it’s relevant for every utility across the country and EnergyAustralia is quite happy to share the information from this program with every one of our colleagues,” Mr Lilliss said.
“It will be an opportunity for the industry to share and there has already been a great deal of interest and support already from across the industry and that’s great.
“We welcome that and we hope we can work effectively with all the stakeholders and good partners to make this a success.”
Mr Lilliss has had a longstanding interest in intelligent network strategy and is the leader of EnergyAustralia’s ‘Innovation Strategy’, which includes investment in intelligent electricity networks.
He is also a member of the Federal Government’s recently formed National Smart Metering Steering Committee.
In his current role, Mr Lilliss is overseeing a $5 billion dollar infrastructure improvement program that is being rolled out across EnergyAustralia’s service territory untill 2014. This is the largest transmission and sub-transmission capital works program ever undertaken by the organisation. The Smart Grid Smart City bid will be a “once in a lifetime opportunity” for EnergyAustralia to not only renew its network, but to do so with the most contemporary technologies available.
Mr Lilliss believes one of the key factors for EnergyAustralia winning the bid was the size of their existing intelligent network and the programs already underway.
“Most of what the Commonwealth have asked us to do is really just an extension of a lot our existing program. We’ve got the ability now to focus it in an area, a geography that represents the entire nation.
The program will be critical in accelerating the trial of smart grid technology with customers. Smart devices and telecommunications will provide an opportunity to offer choices to customers for their energy delivery and retail related options, leading to better customer outcomes around pricing, efficiencies and integration of renewables.
“There are two principle issues. At the customer level it’s a broad scale test of the integration of all those technologies and learning how to use them most effectively and to integrate those things into daily life in the most effective way. “But secondly, the program allows us to accelerate some of our existing programs, such as our distribution monitoring program, where we’re looking to assess faults and repair faults much more quickly on the local distribution network. So it allows an acceleration of that sort of program.”
While EnergyAustralia has 400,000 time-of-use meters in customers’ premises, only slightly more than half of those are presently connected to time-of-use electricity accounts.
“Really (time-of-use is) only one part of the equation. What we are looking to do here is be able to model and provide information to customers a whole range of issues, not just time-of-use pricing, but to examine a whole range of contract and pricing models through from critical peak pricing to rebates and incentives schemes which have not really been trialed on a commercial scale before. Right through to proper integration of renewables and trailing grid voltage support, electric vehicles, a whole range of things people has been talking about for a number of years but have not been scaled on a commercial scale.”
Mr Lilliss said there was quite a difference between having a theoretical concept on how the program would work compared to the actual roll out of smart grid meters on a commercial scale. With mass media concerns and backlash occurring earlier this year over Victoria’s smart meter roll out, understanding customer psychology and interaction with smart grid technology will be a core part of the commercial-scale trial.
“One of the reasons we were successful at bidding Newcastle is that Newcastle represents a very broad demographic. So if we’re accurate about deploying the trial in Newcastle we should hit all of those points and therefore what we learn in the trial, in terms of individual customers and group customary direction, we should be able to apply to broad-scale customer management and education at the national level.
“This is where we will have all those learnings and they will prove very valuable in managing not just what’s going to happen in this state but those issues nationally.”
EnergyAustralia is hoping to replicate and test its home area network (HAN) technology with customers.
“There are a lot of people talking about what the HAN might be used for. At the moment I don’t think we have a very accurate picture of, first of all, how customers will react to the HAN, secondly, who should deploy the HAN and under what circumstances the HAN should be used to control load or other customer functions,” Mr Lilliss said.
“Does the customer ultimately own the HAN is a question in my mind. Or is it something that’s equally provided on an open access basis by networks and retailers and other third parties? For instance, Google might own the HAN. So all of these various models exist in people’s minds but they have not been tested.”
One thousand homes are involved in their Newington trial where 100 HANs will be deployed.
“With that deployment and for the first time that really brings a very large sample to how customers interact home are network technology,” he said.
4G wireless network for smart grid
will install a 4G wireless telecommunications network to transmit crucial two-way information between field devices, back-end systems and households.
Managing director George Maltabarow said carrier-grade 4G WiMAX technology has been selected after a successful trial at six sites in the greater Newcastle area and two sites in Sydney.
“The 4G network will allow communication with up to two million smart devices on the electricity grid,” he said.
“The 4G network will transmit data between 12,000 smart monitoring devices being installed on our electricity network, up to 3000 mobile field computers, 200 major zone substations and our ‘Smart Village’ in Newington.
“This telecommunications network will be phased in progressively across about 140 locations over about 18 months and is the linchpin for a fully connected smart grid.
“A smart grid needs a communications platform to bring all the real-time data from our substations and field devices back so our IT systems can turn that data into useful information for planners, field staff and consumers.
“It will also allow a faster response to power outages, support potential changes in the grid from renewable energy and electric vehicles, and will give households more information and control over their appliances and energy use.
“This machine-to-machine communications network will send information back to a purpose built operations centre to make our electricity grid faster and more efficient.”
Earlier this year, EnergyAustralia entered an agreement with Wireless Broadband Australia (WBA) to use 15 MHz of WBA’s 2.3 GHz spectrum for EnergyAustralia’s 4G network.
As well as trialling 4G technology, EnergyAustralia investigated RF Mesh and Powerline technology to determine the best option for its smart grid program.
4G sites have already been established at Gan Gan HiIl at Nelson Bay and at EnergyAustralia sites at Broadmeadow, Merewether, Mayfield West, The Hill, Wallsend, Lidcombe and Homebush.
The network will be progressively rolled out once suitable sites have been surveyed and identified with the next sites planned being EnergyAustralia substations at Lane Cove, Leightonfield, Bass Hill and Meadowbank in Sydney.
Co-ordinating the smart grid
Over 40 industry CEOs and leaders met in June for the two-day Smart Electricity World conference in Melbourne to discuss smart grid issues.
Energy Network Association (ENA) director of smart networks policy, Tanya Barden opened the first day to discuss Australia positioning itself at the forefront of smart energy.
In giving the opening address to Smart Electricity World, Mrs Barden spoke of the need for all stakeholders to co-ordinate knowledge and efforts to develop the policies and procedures necessary to deliver smart networks in a timely and cost effective manner. Ms Barden gave an overview of the work ENA is undertaking to realise the vision for change and prepare for the energy revolution.
One of ENA’s main priorities is finalisation of its Smart Network Policy Framework, which aims to further the industry’s thinking and give all key stakeholders high level guidance on what needs to be done to deliver efficient and effective smart networks.
ENA’s Smart Networks Policy Framework will also set out ENA’s progress in overcoming the challenges and the critical tasks they are undertaking in the next 12 to 18 months. These tasks include developing an industry-wide approach to radio frequency spectrum, compiling a knowledge store of information from various pilots and trials and developing a stakeholder engagement strategy.
Ergon Energy general manager metering, Mike Dougan’s presentation asked how the industry could enable customers to generate their own electricity and input it back into the grid. According to the presentation, customers did not like new technology, changing their behaviour, “crimping their style” and having to opt out.
With pricing issues either engaging or enraging customers, the presentation emphasised the need to engage, inform and empower customers. Ergon is currently testing new PV installations with half-hour data loggers on Queensland’s Magnetic Island as part of their Solar Cities project.
NBN Co. CTO, Gary McLaren’s presentation defined the coverage and network architecture for the national broadband network, creating a platform where cross industry synergies can be reached and the unique opportunity the NBN presented.
Austin Energy chief strategy officer, John Baker’s presentation introduced a US perspective and discussed the need for distribution to keep pace with fast developments. Strategic challenges faced by the industry included infrastructure materials, equipment and fuels, increased capex and opex, supply adequacy of utility energy resources, work force challenges and numerous customer side issues such as zero net energy, new utility models and system reliability.
Also presenting at the event was GE International smart grid development leader, Jim Kuiper on smart grid and capital efficiency. His presentation showed consumers driving the smart grid with a predicted two to four million electric cars in Australia by 2020, a New South Wales gross feed-in tariff of $0.60 and 82 per cent air conditioning penetration in Western Sydney. Mr Kuiper explained the benefits of M&D included more load served; asset life extension; reduced inspections and scheduled maintenance; and reduced risk-adjusted cost of failure.
The conference pre-event looked at the relationship between the network and electric vehicles. The conference’s first day featured a speed networking event as well as a cocktail reception before ending with a conference on maximising the potential of the future electrical grid.
In August the energy industry will meet again for the Australian Energy & Utility Conference in Sydney. NBN.
The smart grid market
By Paul Budde
This year will see many exciting developments in the smart grid areas. EnergyAustralia was named the successful bidder of the $100 million Smart Grid, Smart City project in June. Over the next three years, important insight will be gained for a national rollout of smart grid projects. These developments will also stimulate others to move on from demonstration projects and progress from smart meter roll-outs towards smart grids. There will be further pressure on the government to better align energy and environmental policies, as well as electricity regulations.
There has been a lot of discussion about the communication requirements for the utilities. If it were to be limited simply to meter-reading, the good old powerline communication system (invented in 1897) would be sufficient; however, if you start looking at a transformation of the utilities industry then we can probably expect a range of new applications that haven’t even been thought of so far. Some people are even talking about a totally new element of the economy (the so-called green economy) and smart grids could become key infrastructure in such a development – the major conduit for a range of new economic activities in this sector. Similar to the digital economy, which was fuelled by broadband, economists have already made extremely positive job creation calculations for the green economy.
Energy and environmental applications are in great demand and the fact that companies like Google and Microsoft are very active in this market is an indication that more can be expected. The utilities could become facilitators in this market and through the retail companies they could also, either directly or indirectly, become players in an emerging ‘Apps’ market.
Keeping the options open and not being locked out or ending up in a dead-end street (eg. with not so smart meters) should be a very important consideration. Furthermore, future-based broadband networks are not just capacity – they are also about security, reliability and low ongoing maintenance costs.
Broadband, as the communications conduit for smart grids, would add the benefits of an unlimited ‘pipe’ for utility and future energy management purposes.
It would not make sense for utilities to roll out their own fibre networks for last-mile smart grids connections, whereas piggybacking on a broadband roll-out certainly would make sense.
The trans-sector approach – where infrastructure is shared by many different sectors – is catching on. NBN Co. and the electricity utilities are now very actively engaged in exploring cooperative ways that would take into account the requirements of both the utilities and NBN Co. in relation to the roll-out of smart grids and the roll-out of broadband respectively.
This is clear evidence of the potential synergy in sharing infrastructure. Both parties will have to look at each other’s needs and assess if the separate requirements can be delivered over the one network. This exercise alone will be extremely valuable, as it might also create a platform for other sectors (healthcare, education) to work out with NBN Co how best to look after their specific infrastructure needs.
For example, VPNs will certainly be necessary in both education and healthcare and there is now an increased focus on cloud computing also; it will be interesting to see how NBN Co facilitates these future developments within the current design and architecture plans. This can only be properly addressed when these other sectors become proactively involved in these design architecture issues.
The way it will operate in relation to smart grids is that Smart Grid Australia (SGA) and NBN Co have set up an arrangement whereby SGA will proactively provide information and make suggestions to maximise the benefits of working together.
Shared infrastructure is a very smart initiative indeed and both in the US and Australia the national broadband plans are investigating and actually pursuing such a trans-sector approach.
Without sharing the business model for universal high-speed broadband will not stack up – the costs of infrastructure is one of the most critical elements in any national broadband plan. It is therefore great to see that in all six roll-out sites of the NBN utilities are either already involved or are negotiating to become involved.
There is certainly no uniform approach to smart grids among utilities, but at the same time many energy companies are fully aware of their need for much better communications requirements in relation to their network efficiency. They also acknowledge the need for the management of renewable energy and electric vehicles within their network and the increased demand for home automation networks (HANs). So a significant number of electricity utilities understand the strategic benefits associated with a combined smart grid/broadband roll-out.
The fact that these two developments – broadband and smart grid – are happening at the same time is certainly viewed by the visionaries within both industries as a unique source of synergy.
The most strategically oriented utilities don’t consider this to be just an opportunity to make money by leasing the use of their poles. They understand the negotiating power they have to secure the best possible communications deal for their smart grid requirements.
Even without a co-operative infrastructure strategy, ensuring the broadband companies will use utility poles to install the street fibre should be high on the strategic agendas of the utilities. This would at least give them a seat at a table in the discussions relating to the National Broadband Plan infrastructure and it would also allow them, at least potentially, to negotiate a reasonable (that is, non-wholesale tariff) deal with the broadband companies.
The Business Council of Australia has predicted a doubling of electricity prices within five years, pointing to carbon charges, increases in network charges and the effect of a larger renewable energy target as the causes. Added to this is the conflict between an ever-increasing demand for electricity and the cost of maintaining and replacing the existing networks.
For example, the Australian Energy Regulator is looking at approving a spend of almost $12 billion by Queensland electricity distribution business over five years, and it has signed off on $16.4 billion in capex by the state government-owned network business in New South Wales.
Proposals for capital works expenditure of $5.47 billion by Victorian networks are also being considered. And the West Australian state regulator has accepted a $1.5 billion outlay by the Western Australian networks company over the next three years.
Increasing revenue by raising prices is obviously going to be one method of recouping this expenditure. Business and community groups are concerned about the impact of the predicted power price increases. Smart Grid will allow businesses and consumers to better monitor and manage their energy use and there has been examples where energy savings of up to 30 per cent are feasible, this would clearly offset some of the increased costs of electricity.
There is no doubt that the energy sector will be seriously impacted by future events such as climate change, escalating user demands and the necessity for technological developments and maintenance.
The fundamental shift that has taken place in environmental policies will have a huge effect on the utilities market. Energy policies that were developed prior to this now need to be considered in relation to the new climate change and environmental realities – and for ICT and energy industries this will involve checking government initiatives such as smart meters and national fibre telecoms networks against the new direction.
While our regulatory regimes have undergone their most significant changes in a decade, further action is needed. Far more reaching regulatory changes will be required, aimed at creating incentives to stimulate investments in smart grids. In order to make this happen it was suggested that the industry transforms itself and align itself more to a range of new trans-sector developments in the market, requiring political and corporate will, sufficient practical business, encouraging regulatory framework and further investment in infrastructure.
Facilitating innovation through government certainty
By Richard Twisk, Jemena General Manager of Electricity Networks
Meeting with Australia’s utility leaders at the Smart Electricity World conference in June, serious debate concerning industry innovation, strategy and investment took place. As a speaker on the first day, I discussed the Government’s role in fostering innovation for a progressive energy landscape and the role of collaborative multi-state planning for smart grid infrastructure.
The Victorian Government has a key role to play in developing policy to support the adoption of smart energy solutions and provide appropriate frameworks to foster innovation. It can provide investment certainty for investment in innovation, providing incentives to support smart energy technology, pursuing and implementing key initiatives, and promoting customer engagement of initiatives.
In accordance with state government policy and regulation, all Victorian DBs are currently implementing the Advanced Metering Infrastructure (AMI) program, with the aim of establishing a technology platform for future energy solutions in the home and smart grid solutions in the distribution network. This investment is dependent on regulatory certainty. The Government has provided this certainty by providing a defined scope of works, defining the allocation of responsibility and providing a cost-recovery mechanism.
Legal and regulatory instruments providing certainty include OIC (functionality and service level) specifications, the Advanced Metering Infrastructure Order in Council 2008 and the National Electricity Amendment (Victorian Jurisdictional Derogation (Advanced Metering Infrastructure Roll Out)) Rule 2009, approved by the AEMC. The implementation of this initiative would not have occurred without state government involvement and leadership.
It is not just a ‘Smart Meter’ anymore. The ‘Smart Meter’ program is now a ‘Smart Network’ program, by using an efficient and prudent approach, to derive full value from AMI over the longer term.
At Jemena, we are currently working with UED to roll-out smart meters for our customers across Melbourne. The AMI project for UED and Jemena consists replacing around one million (650,000 UED, 320,000 Jemena) meters with AMI meters by 2013. This will provide a two-way mesh radio communications network and involves the implementation of information systems and business processes.
The provision of funding is critical to stimulate industry focus within this area, and this is particularly the case in Victoria. The privatised and disaggregated energy market has spread the value chain across many different players, each looking to capture value through innovation.
Investment certainty will assist in the development of the industry from the establishment of electric vehicle manufacturing plants, to R&D innovation in distributed storage, to attracting research programs to facilitate innovation – across both the state and national levels. Australia is competing with the rest of the world in this arena. The US and China are each investing $7 billion in smart grid trials and stimulus, creating a positive environment for investment – these kinds of initiatives will be key for fostering innovation in Australia.
The State Government can play a role by both initiating and funding the trials of this technology. An example where this is currently in place is the Victorian Department of Transports funded electric vehicle trial, providing $5 million of funding to establish a statewide trial of electric vehicles, infrastructure and management. In this example, the role of state government is particularly important, as any real-scale deployment will require co-ordination between electricity network owners to ensure inter-operability and proper management of the trial electric vehicle system.
State Government also has a pivotal role in increasing consumer engagement with smart energy issues and fostering of solutions. For example; implementing education programs aimed at generating awareness of energy issues. In addition, local government is also a key channel for engaging the community in smart energy initiatives.
A further role for State Government is to promote the overall benefits to the “business” case for smart energy solutions, as they are not always purely economic. A ‘whole of benefit’ approach taking into account economic, social and environmental benefits is required, involving close collaboration within government departments to crystallise these benefits to drive appropriate market mechanics to stimulate industry and to drive these innovations.
National planning is important for the development of smart grid infrastructure to deliver national energy efficient and carbon abatement outcomes. An example of current national leadership and collaborative multi-state planning in the smart grid infrastructure platform is the National Smart Metering Program (NSMP) where the state and federal divisions of COAG are developing a national smart metering business case and functional specification. Collaborative approaches such as these can leverage off the smart meter work done to date in Victoria and can therefore ensure consistency of approach across all jurisdictions.
There are many Commonwealth departments that have influence over national energy policy, across transport, communication, industry and other departments. Integration and co-ordination of policy responses across departments is imperative. For example, smart grid infrastructure touches on renewable energy, energy networks, transport, and employment and training, so it is important departments co-ordinate this and produce policies that deliver not only economic but also social and financial benefits.
Smart grid technology provides support for the delivery of power generated through renewable sources. To produce renewable generation en masse requires management of two-way flow of power. With the increasing number of solar panels, and the potential of electric cars to provide energy into the grid, the customer is becoming the producer. The term ‘prosumer’ has been created.
Smart grid further enables uptake of energy efficient consumer behaviours through the provision of consumer tools. Home area networks, through interconnection with a smart meter, supports ‘in-home-devices’ for monitoring and managing home energy efficiency use, with the potential to integrate through to individual appliances. Customers can make their own energy decisions if they have the information.
Smart grid infrastructure is also critical in enabling technologies that can further drive the uptake of renewable generation, such as electric vehicles. A smart grid will be required to support the mass roll-out of electric vehicles and the mass roll-out of electric vehicles will arguably be driven by access to renewable power. The realistic view of the future home, includes micro generation, smart meter, home display devices (via the internet or a panel), demand-side management devices on air-conditioning and perhaps an electric car.
It is clear the role of local, state and federal government is significant in facilitating innovation. Innovation needs government policy and initiatives. Network owners require investment certainty and government agencies must provide leadership through co-ordination and collaboration across industry and community.
Early returns on investment key to smart grid success
By Ian McRae, The LiTMUS Group Partner and Energy and Utilities Sector lead
In 2007, Cisco Systems launched I-Prize, a worldwide contest to identify innovations that could spawn a new billion-dollar business. The response was overwhelming. More than 1200 ideas were submitted from around the world, with first place going to a proposal to create a sensor-enabled electricity grid.
Since that announcement, firms including Cisco, General Electric, ABB, Siemens, Oracle and Microsoft have aggressively positioned themselves to be major players in this emerging market.
In addition, the world’s largest and most powerful countries have jumped on the bandwagon. China is making enormous investments in energy technology; Australia is mandating installation of digital meters; the European Union is pushing for more rapid adoption of renewable sources into the grid; and the US is granting billions of dollars to electric utilities to accelerate their “smart” efforts.
Across the globe, power delivery providers are initiating smart grid programs, supported by their rate and business cases and confident in their ability to achieve reasonable returns.
Yet at a fundamental level, there is still confusion in the market about exactly what benefits a smart grid will provide. As for how to plot a course from today’s “dumb” grid to tomorrow’s smart one, there is even less clarity.
At a recent energy summit held in Paris, experts from leading consulting firms gathered to address such questions as, ‘What is a smart grid?’ and, ‘How do I get started in deploying one?’. The summit brought together perspectives from North America, Europe and the Pacific Rim.These leaders represented a collective 150-plus years of industry experience across more than a dozen utilities worldwide.
One of the key findings of the summit was that to validate the business case and demonstrate to stakeholders the program’s value, every smart grid initiative should look for early returns on investment.
Deployment of the baseline elements – installation of smart meters and their associated communication network – will require a significant amount of capital, and as such, some opportunities will quickly surface to further capitalise on the new technology.
These “quick hits” generally fall into two categories:
1. Grid efficiency – many utilities are focusing their initial scope on improving the quality and reliability of the distribution grid. There are opportunities to reduce labour costs, minimise asset deterioration, and lower consumption of natural resources.
Quick hits include:
• Improvements to automated meter reading (AMR) by leveraging the full-time availability of an advanced metering infrastructure (AMI). For example, meter readings can be done on demand or at scheduled intervals without the need for route drivers.
• Line voltage reduction to reduce consumption of natural resources and increase the lifespan in the field of power delivery assets.
• Extension of outage notifications from beyond the substation to individual premises, thereby focusing service crews on trouble spots and decreasing loss of service.
2. Customer service – a smart grid will provide a great deal more detail about a customer’s consumption of energy while giving utilities remote access to the service connection point.
Quick hits include:
• remote order fulfilment capabilities that let a provider connect/disconnect service at a location without physically accessing the site;
• pre-payment options that will improve collections by letting customers pay as they go for energy services as they can today for cellular telephones – an especially attractive option for lower-income households; and
• energy-usage monitoring to provide customers with more detail about how and when they are consuming power throughout their day so they can adjust behaviours to better control energy costs.
By incorporating these quick hits in the scope of your smart grid program, you have the opportunity to show early results on performance of the technology. This lets you fine-tune the scope and direction of the initiative while also winning the hearts and minds of customers and operations personnel.
Their championship will be important as you continue with your program into a phase that requires more significant investment of time and money to yield acceptable returns.
Even with measured steps, the smart grid is an expensive undertaking. The power delivery industry is expected to invest more than US$150 billion in the US alone to develop and deploy intelligence in its distribution networks.
As vendor companies and their products and services stabilise, the cost of deployment will fall, but not before consolidation and obsolescence have impacted many providers and their partners.
Which brings us to the question, will the smart grid be transformative for utilities? The answer is “yes”, over time. But the transformation will be evolutionary rather than revolutionary.
Meanwhile, initiating your ‘Smart Grid’ program need not be a leap in the dark. If you develop a smart grid strategy, cover the fundamental bases of any large change initiative, and focus on quick hits while prioritising higher return applications and services, you can achieve remarkable results with your program.
These best practices will help you take the evolutionary steps necessary to make smart grid a reality and set the stage for conducting business in innovative and transformative ways in the future.
Securing project collaboration
By Peter Borngiorno, Intralinks Vice President Product Strategy Energy and Utilities
Energy Source & Distribution talks to Intralinks product strategy energy and utilities vice president, Peter Bongiorno about securing critical systems during industry project collaboration.
The worldwide energy industry is in the grips of a frenetic investment in project infrastructure, according to Peter Bongiorno. The US-based critical information management expert has seen tremendous advancement take place in South America’s hydro plants and resource mines, growing momentum in the halls of Washington DC for a nuclear program and the rollout of smart grid programs and numerous wind farm developments in Australia. According to ABARE’s April project report, there are 15 major electricity generation projects at an advanced stage in Australia with a total generating capacity of 2687 MW and value of around $4.9 billion. There were a further 127 projects at a less advanced stage of development at that time. Mr Bongiorno estimates in the US alone the projected capital infrastructure spend is between $1.5 to $2.0 trillion over the next 20 years.
“It’s explosive,” Mr Bongiorno told ESD, “between environmental sensitivities’, global warming, the shift to and the focus on electrical infrastructure, electric vehicles, wind farms (and) the need to put the transmission infrastructure in place to transmit energy from locations and sources that basically are new.”
In his 20 years involved in content management solutions Mr. Bongiorno has established new methods for analysing content management and workflow needs and implemented emerging technologies in a variety of industries. Presenting at Melbourne’s Smart Electricity World conference in June, Mr Bongiorno’s company is pursuing global project life cycle management and information management opportunities with large capital projects. Even as uncertainty surrounds and stalls carbon-emitting energy generation, firms are still pursuing and securing loans for many significant projects.
“What I’m seeing is there is a continued push on the traditional fossil fuels that still continues, because they are not going away tomorrow,” Mr Bongiorno said.
“You’re seeing a tremendous push for nuclear, like in the US for example (where) for the first time in 20-30 years that’s really getting some excitement around it. More than excitement, it’s getting money and funding and serious projects are back on the books.
“The US Department of Energy, through the US Resources and Recovery Act (has provided) a $3.4 billion dollar grant… to utility companies for 100 projects. And if you look at those projects, about a third of them are over $50 million and there are several in the $100 million. The largest is about $800 million dollars. So, these are large, large projects and they involve a number of joint venture partners and they are complex, they need well-structured, well-managed information flows to properly execute them.
“Here in Australia, you’ve got the focus on smart grid, wind farms (and the) electric vehicle pilot program the Department of Transportation is pursuing. The smart grid is happening at so many different levels, areas and ways, to basically drive efficiency, come up with renewable sources or find ways to further extend our traditional fuel source.”
Mr Bongiorno identifies a clear industry challenge with energy utility companies using a mix of different platforms and processes, from posting physical mail to email and content management systems. Companies face the issue of unreliable forms of communication once they leave the company’s firewall to share and exchange information with external partners and enterprises, relying on physical mail and email for documents.
“That introduces a number of challenges for them. When you’re working on a billion dollar project or a $100 million dollar project and you’re trying to make sure everyone has the latest document and they are working off the right document, that they have confirmed receipt of document, that they are critical to timely execution. Just sending back emails becomes an ungainly way to try and to make sure everyone is working off the right set of documents at the right time.”
As Australia’s smart grid networks and other projects acquire funding and begin to take shape, secure methods of information dissemination become crucial. Intralink focuses on managing documents and information shared and exchanged between firms involved with implementing projects. With a grounding in virtual data rooms for financial development and investment banking, merchant acquisitions, IPOs and asset sales, Intralinks is looking to expand its security platform into emerging energy sector transactions requiring critical information exchange as a key part of the business processes.
With projects numbering their lifespan in the decades, from initial life cycle screening feasibility and investment design decisions to construction, operations and eventual divestiture of aging assets, there can be a significant amount of information to share and track. According to Mr Bongiorno, the Intralinks platform provides functionality that allows companies to collaborate processes and manage content in a secure manner while ensuring they are looking at the right information that has been delivered with confirmation of receipt, reviews and approvals. Mr Bongiorno identifies four key aspects of project lifecycle management where information collaboration is critical: engineering, regulatory, procurement and financing.
“So across those four keys areas and across the project life cycle we are seeing some very strong need in the industry because the amount of investment which is going on to upgrade infrastructure and develop new capabilities. “Everything from smart grid to nuclear power plants, wind farms – there is tremendous amount of capitalisation going into investment into upgrading the infrastructure which is driving projects and driving a need in this particular area for better information management.”
EnergyAustralia’s winning tender for the $100 million Smart Grid, Smart City project and its goal to gather and share information within the industry underlines this need for secure collaboration.
“Our focus is helping the firms and utilities involved in these projects execute these projects better. Driving information performance will drive project performance, making sure that the projects are done on time, on budget, on schedule with the least amount of risk. And they do face significant risk and challenges in executing these projects and information is a critical part of that.
“As companies are ramping up on these projects they are going to see the need for capabilities that we’re talking about.”
Intralink’s web hosting application facilitates cross-enterprise transactions, allowing business processes to extend outside the enterprise to an entire community of participants. No hardware or software is installed: the company’s sharing information need to sign up as part of the same internet user community and provide permission for their other to .
“So they want to make sure, for example, that anybody accessing it might have at least signed confidentiality agreements where they might want to have better controls. And that’s exactly the kind of situation where we can very keenly support those types of needs. And we have the audit trail in our systems to track whose accessing documents, how they’ve accessed those documents and we can provide the controls to have companies feel more comfortable about who and how they’re sharing information in these types of joint trial projects.”
With numerous projects in the pipeline driving industry collaboration, secure documents will continue to be of critical importance for Australian utilities, distributors and generators.