Smart Grid technology is aimed at creating a more dynamic power grid where users can ‘interact’ with the system and actively control their energy consumption thus reducing costs. It can use digital technology in delivering energy which leads to an increase in reliability and transparency. Ambitions of what Smart Grids can accomplish are grand, but so are the possibilities.
For the home consumer, new technology might result in the ability of electronic equipment to shut off or hibernate automatically whenever it is not used. Or, since (near) real time data will be transported and displayed in homes, the consumer can choose to run machinery when overall demand is low. On a larger, regional scale, Smart technologies can make it possible for energy to be transferred to essential functions such as hospitals, fire department etc in case of emergency.
Real time data transfer could also enable systems to automatically respond to interruptions, outages, changes in weather etc. It can also work as an incentive for consumers to avoid heavy energy consumption during peak hours thus optimizing grid usage.
But not only consumers can decrease costs by using Smart technology; utilities will reduce costs from meter reading, turn on/turn offs and customer support, since inquires about billing specifications will decrease (read more here). Also, since the power grid will be used more optimally there will not be the same need to invest in expanded infrastructure.
All and all, a Smart Grid can significantly reduce energy consumption and consequently, greenhouse gas emissions.
At the center of Smart Grid development are interoperability standards since it is paramount that all the equipment can work together. Most common are wireless standards, e.g. IEEE 802, WiMAX and WiFi. Standards are necessary, it is argued, to implement at an early stage as not to end up in a situation where several, non-interoperable solutions exist.
In the US, the National Institute of Standards and Technology (NIST) has been appointed responsible for coordinating the framework for Smart Grid interoperability, and they recently published a draft publication of the framework and standards road map. The report presents 31 standards for which a strong stakeholder consensus is believed to be found and 46 additional standards which might be suitable for implementation.
In the EU, Smart Grid policies operates under the European Technology Platform and aims toward creating a joint vision for an European Smart Grid by 2020. A key step in reaching this goal is said to be the implementation of shared technical standards that will ensure open access.
Since power grids are huge pieces of infrastructure, the digitalization process involves huge sums of money. In Europe alone the investment needed to upgrade the current grid is estimated to € 500 billion and the US build out is valued at $ 20 billion a year. Naturally this attracts market giants such as Cisco, IBM and Intel.
Hopefully however, the benefits of the Smart Grid will reach all. Consumers will be more in control of their energy consumption and costs; utilities will be able to increase reliability in deliverance and cut administrative costs; and the environment will benefit from the reduction in greenhouse gas emissions. Clearly, Smart Grids are an essential and beneficial part of the transition into the digital society.