By Roy Palmer, Xcel Energy
This past summer more than 100 Xcel Energy engineers, construction and contract workers have been focused on laying more than 250 miles of connectivity fiber, mapping out routes for a high-speed communication network and installing thousands of advanced meters in Boulder, Colo., as construction begins on the nation’s first SmartGridCity.
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Xcel Energy has announced plans to build out an entire community that combines traditional and cutting-edge technology to move the energy grid into the modern age. Smart grid initiatives have gained momentum of late across the industry, and Xcel Energy’s SmartGridCity proposes the largest and densest concentration of these emerging technologies to date.
It’s an ambitious project that is being closely watched as energy leaders struggle with finding workable solutions to growing operational, financial and environmental challenges. International interest in SmartGridCity continues to build. A senior policy advisor from the World Economic Forum recently traveled to Boulder from Switzerland to lend his support to the project.
As a result, Xcel Energy chairman and CEO Dick Kelly was invited to participate in the World Economic Forum’s annual “Summer Davos” Summit in the People’s Republic of China this month (September 25-27). Of particular interest is SmartGridCity’s potential to shape and stimulate economic growth with fresh ideas, new business models and leading edge technologies. All eyes are on the college town nestled in the foothills of the Rocky Mountains as it breaks ground on this innovative effort, which has the potential to fundamentally change the way the energy industry does business.
Time for Smart Grid is Now
As part of a yearlong investigation, Popular Mechanics’ recent Special Report “Rebuilding America” identified smart grid as one of the country’s most necessary infrastructure upgrades. The article points out that our grids today are more stressed than they have been in the past three decades. The United States uses 4 trillion kilowatt-hours of electricity each year, and the figure is expected to climb and eventually outstrip current generating capacity.
If the nation doesn’t expand capacity to keep up with a projected increase in demand of 40 percent over the next 25 years, we’re going to see healthy grids become increasingly less reliable. Today, with the grid operating “as is,” any disruption–like a downed transmission line or a key power source unexpectedly coming offline–can in effect cripple the network.
Additionally, the majority of the nation’s power grid was built in the mid-20th century. It was during this unprecedented “age of construction” when the continent was wired for electricity. Our industry has essentially inherited an infrastructure that has not changed fundamentally in the last hundred years, although the world as we know it has become wired and digital and consumers’ demands and expectations have grown exponentially.
Consensus among utilities is that new information technology, fresh engineering and advanced materials can help us not just restore, but improve our country’s infrastructure in the coming century. Planned and managed properly, next-generation projects can be smarter and more resilient than what came before.
Xcel Energy believes what the industry needs today is a large-scale initiative that can move us from the analog days of Thomas Edison into the instantaneous sense-and-respond digital age of Bill Gates.
New Energy Landscape Drives Change
The idea of a “smarter” power grid has gained hold among utilities, although the details and definitions of its components vary greatly within the industry. In broad terms, a smart grid is an intelligent, auto-balancing, self-monitoring power grid that accepts energy from any source (coal, sun, wind) and transforms it into a consumer’s end use (heat, light, warm water) with minimal human intervention.
Using networking technology to monitor–and react to–what’s happening in the grid at each moment can improve efficiency and prevent outages. Decentralizing the production of electricity can also make the grid more resilient and allow utilities to more easily integrate renewable or emerging new energy sources onto transmission lines.
“Our vision of smart grid covers the entire energy pathway or value chain–everything from the power source to the customer,” explained Ray Gogel, Xcel Energy’s chief administrative officer and vice president of customer and enterprise solutions. “We see smart grid as a continuing organic evolution of our system that includes multiple layers of functional intelligence leading to real-time decision making and action. That unique vision is becoming a reality right now in Boulder.”
Another aspect that sets SmartGridCity apart is that rather than implementing a single-solution technology, Xcel Energy is designing a comprehensive portfolio of technologies to integrate all aspects of our grid in a full-scale implementation. It’s an all-encompassing approach, where others, by comparison, are siloed and vertically focused.
Xcel Energy is also one of just a few utilities that is looking at smart grid as an environmental solution in an increasingly carbon-constrained world. The fact is, smart grid is an essential piece of the company’s environmentally focused business strategy and will become even more vital as utilities and cities strive to meet carbon-cutting goals and prepare for eventual carbon taxes. Customers are looking to us for the means to reduce their own carbon footprint, and they expect us to do the same. In doing so, the requirements for the industry will shift from merely “following the load” to actually “shaping the load.”
In other words, Xcel Energy is attempting to shift the industry’s paradigm from simply maintaining a grid that meets customer energy demands whenever they ask for it–which is essentially a “one-way” grid–to become an interactive, two-way grid that involves customers in the process. This vision gives customers new choices, more options and the ability to conveniently control their energy consumption as part of their everyday lives.
SmartGridCity: Taking It from Concept to Reality
It’s one thing to have vision, but you also have to have a team on the ground that can make it happen. Xcel Energy began working on the SmartGridCity concept over five years ago by bringing together a group of partners who helped define the “utility of the future.” Together, they initiated test projects to determine how to best enhance reliability and improve cost structures.
In 2007, Xcel Energy established the Smart Grid Consortium of partners, dedicated to the large-scale proof of concept of an end-to-end vision of the digital grid to further improve reliability and cost, while also delivering significant environmental impact. The team unites leading technologists, engineering firms, business leaders and IT experts to provide guidance, products and services needed to support both the design and deployment of the smart grid system. Accenture, Current Group, GridPoint, Schweitzer Engineering Laboratories and Ventyx have joined the consortium, and other partners are expected to sign on as the effort continues.
In March 2008, the group announced its intention to make Boulder America’s first SmartGridCity. In addition to its geographic concentration, ideal size and access to all required grid components, Boulder was selected as the best location given its technology-savvy customer base and proximity to the University of Colorado, federal labs and nationally recognized think tanks.
On May 15, Xcel Energy’s leaders held a press event and presented city leaders with a design plan outlining how SmartGridCity would be built. “Construction is taking place in two main phases, and employs a crew of up to 115 people dedicated to the deployment and build out,” said Randy Huston, Xcel Energy’s project delivery executive for SmartGridCity. “The City of Boulder has been a key collaborator and we’re working closely with both the city manager and Public Works department on vegetation management and other “Ëœmake ready’ work. IBEW 111 is another critical partner and is helping us find the right crews for the enormous task at hand.”
The fundamental component that ties smart grid together is a robust and dynamic communications network that provides for instant two-way communication and interaction throughout the grid. The installation of the high-speed communication network and sensing equipment on the distribution network has already begun. Over the summer months, contracted crews began pulling aerial fiber, laying underground fiber and installing nearly 15,000 new smart meters, on pace to replace 2,500 meters each week.
“The primary means of communication across SmartGridCity will be broadband over power lines, or BPL,” added Huston. “Nearly 90 percent of the city will be connected with BPL, although the company also plans to test wireless capabilities in parts of the network as well.”
When construction is completed in December 2009, SmartGridCity will boast:
- Small-scale power: Neighborhoods where energy needs can be matched with locally available generation and controls to juggle supply and demand.
- Advanced monitoring: Real-time data can help utilities make better decisions that prevent outages and allow for predictive, rather than just reactive, action.
- Energy storage: Plug-in hybrid electric vehicles (PHEVs) are just one example of how a smart grid would use power reserves. Drivers could potentially charge their cars at night, and then sell some percentage of power back during the day when demand peaks.
- Smart substations: Stations capable of remote monitoring, near real-time data, heightened security and optimized performance.
- In-home energy control devices: At the customer’s invitation, Xcel Energy will install programmable in-home control devices to automate home energy use.
Benefits for All
The smart grid system–when fully implemented over the next few years–will provide customers in Boulder with a range of new products, services and technologies. “A smart grid has the potential to radically transform the relationship between the customer and the utility,” said Gogel. “Customers will have the information needed to make educated decisions on their energy use, help them manage their energy dollars and reduce their own environmental impact. It really opens up the door for new energy management offerings and conservation options not currently possible with today’s infrastructure.”
Some of the goals for SmartGridCity include giving customers:
- Near real-time information about their energy costs.
- Online tools to track and manage electricity use and consumption habits.
- Choices–based on price or availability of green power–as to when and what kind of energy they use.
Smart grid technologies could also allow Xcel Energy to provide better customer service by:
- Using real-time data analytics to help crews fix power problems faster and before customers even know they exist.
- Creating the ability to re-route power as needed and avoid unnecessary strain on the system.
- Providing more detailed information to first responder crews and dispatch, ensuring the right crew mix shows up at the right place, at the right time and with the right tools.
- Eliminating unneeded field trips, or “OK on arrival” calls, and allowing for remote connects and disconnects.
- Reducing customer minutes out as a result of an improved ability to predict or prevent outages and faults.
- Creating potential carbon footprint reductions from lowered residential peak demand and power consumption, improved distribution losses and added conservation options.
The business case benefits for building a more intelligent grid are evident to the investment and analyst community as well. For investors, smart grid provides additional revenue opportunities, can lead to potential deferral of significant capital infrastructure investments and provide for strategically planned upgrades of existing poles, wires and other assets. Preliminary studies from the National Renewable Energy Laboratory (NREL) show that with a conservative estimate of one PHEV for every 100 people, Xcel Energy could potentially generate between $10 million and $20 million in new revenue while reducing overall carbon footprint emissions by up to 50,000 tons per year. (Editor’s note: For more on the NREL, look for our interview in the news section.)
By establishing SmartGridCity as a sort of “living laboratory,” Xcel Energy and its partners can test, certify and standardize smart grid concepts and components. In doing so, the company can measure benefits, manage risk and determine workable deployment strategies.
Ultimately, the company hopes to take lessons learned in Boulder to implement smart grid technologies in other parts of its service territory. SmartGridCity is an essential proving ground for demonstrating possibilities and laying the groundwork for future expansion.
To learn more, visit www.xcelenergy.com/smartgrid.
Roy Palmer is Xcel Energy’s managing director of government and regulatory affairs.
The Smart Grid City
Xcel Energy’s Smart Grid Consortium is working towards a future when our energy grid can predict its problems and strengths while optimizing available resources.
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The Consortium has announced plans to build SmartGridCity, a community that combines traditional and emerging technology to move the energy grid into the digital age.
This next-generation grid will allow customers and unilities to collaboratively manage poser generation, delivery and energy consumption. SmartGridCity will boast a fully interconnected energy system capable of managing the various parts of the grid involved in producing power and delivering it to consumers.
Key components of SmartGridCity include:
- A dynamic system rich in information technology,
- High-speed, real-time, two-way communications,
- Sensors thoughout the grid enabling rapid diagnosis and corrections,
- Decision-making data and support for peak efficiency,
- Distributed generation technologies, (such as wind turbines, solar panels, and plug-in hybrid electric vehicles),
- Automated “smart substations,”
- In-home energy control devices, and
- Automated home energy use.