This is an excerpt from EERE Network News, a weekly electronic newsletter.

January 28, 2009

Report Notes Surging Utility Investment in Smart Grid Technologies

A recent report from the Federal Energy Regulatory Commission (FERC) notes that demand response and advanced metering programs are rapidly gaining ground throughout the United States. Both technologies are aspects of the "smart grid," a concept that involves adding internet-like communication technologies and control technologies to the nation's electrical grid. Advanced meters can provide two-way communication between customers and their electric utility, giving utilities detailed information about electrical loads and power outages while giving customers the option to adjust their energy use in response to real-time utility rates. Demand response is more of a control technology, allowing utilities to turn off, delay, or cycle the customer's use of electrical equipment (such as air conditioners) during times of peak demand. But demand response is also a communication technology, because it sometimes includes a capability to notifying customers of power cutbacks and may allow customers to override the utility controls. Both technologies are baby steps toward an eventual smart grid, which would include improved utility control of power flows through the grid and may also include ways for plug-in hybrids to interact with the grid, using so-called "vehicle to grid" technologies.

The FERC report is the third annual report on these technologies, and it notes that 4.7% of the electrical meters in the United States are now advanced meters, up from less than 1% in 2006. Likewise, 8% of energy consumers in the United States are now participating in some type of demand response program. The total electrical demand that can be shed through demand response programs is now at 5.8% of U.S. peak demand, or close to 41,000 megawatts, a more than tenfold increase from the 2006 estimate of about 3,400 megawatts. That means that utilities can draw on demand response to achieve the equivalent of bringing 82 mid-sized (500-megawatt) coal-fired power plants online, but without causing any pollution. Drawing on such experiences, a recent DOE report concluded that by 2025, smart grid technologies could cut U.S. electricity consumption by 10%-15%, cut peak power demands by 25%, cut greenhouse gas emissions by 20%, drastically reduce power disturbances for businesses, and enable the delivery of high-quality power for digital electronic needs. See the FERC press release and report (PDF 984 KB), as well as Chapter 2 of the DOE report (PDF 1.9 MB). Download Adobe Reader.

Among utilities pursuing smart grid technologies, Xcel Energy took the lead in March 2008, when it announced plans to convert Boulder, Colorado, into the nation's first fully integrated "Smart Grid City." Since then Xcel Energy has fitted the Chancellor's Residence at the University of Colorado with smart grid technologies, including an energy management system, a solar power system, a battery system for backup power, and a plug-in hybrid vehicle that will be automatically charged during off-peak times. The utility has also announced near-term plans to convert 60 hybrid vehicles to plug-in hybrids in order to test vehicle-to-grid technologies, with plans to eventually add another 500 plug-in hybrids. Meanwhile, the General Electric Company (GE) is preparing for smart grid technologies with plans to soon introduce a suite of "smart appliances" that can reduce their energy demand in response to signals from the electric utility. GE notes, for instance, that a smart refrigerator can delay its automatic defrost cycle until non-peak hours. The GE suite of smart appliances will also include ranges, dishwashers, microwave ovens, and clothes washers and dryers. See the Xcel Energy press releases on the Chancellor's Residence and vehicle-to-grid tests, as well as the GE press release.

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