Electric grid becomes smarter to save money
City exploring new ways to distribute peak power demand
By Paige Ingram
Northern Colorado Business Report
April 11, 2008
FORT COLLINS - When the electric company can talk your appliances into using cheaper power, that's smart-grid technology in action. But "smart-grid" can mean different things in different situations.
For an electricity supplier, smart-grid means the ability to gain information about usage from customers in a way that can be applied to improve efficiency of the system. For electric consumers, it means a faster response when something goes wrong.
In short, a smart grid integrates a communications network with the power distribution system to create a new way to deliver electricity. The goal of smart-grid technology is to increase efficient use of resources to reduce operational waste, according to Gary Schroeder, utilities energy services engineer with the city of Fort Collins. This goes way beyond just metering electric usage.
"One of the biggest ways to identify (smart-grid technology) versus some of the automated reading systems is that everything that's smart-grid is characterized by communication, and specifically two-way communication, between a company and a device," Schroeder said.
The whole intent of the smart grid, at least within Fort Collins, is to combat the fact that companies and individuals all tend to use electricity around the same times of the day, Schroeder said.
"There's a peak, in our case between 2 p.m. and 6 p.m.," he said. "That's where electric usage occurs the most."
If everyone comes home at 4 p.m. and starts the laundry and turns on the air conditioner and television, the electrical supply system, which has a certain capacity, gets overloaded, he said. The hope is that by using the smart grid to determine these peak times of usage, electric rates can be altered to help convince larger users, such as businesses, to cut back during these peak times.
Fort Collins Utilities' new load-management program will pay residential customers a $4-per-month rebate on this summer's electric bills for having a radio controller cycle their central air conditioning on and off during peak use times. The city plans to expand the program beyond the initial 500 customers next year.
Such moves would not only reduce the carbon footprint of electrical use, but also would keep the electric company from needing to add redundant infrastructure to keep up with demand, said Bob Micek, electric system engineering manager for Fort Collins Utilities. Without having to pay for that labor and overhead, electric companies could keep rates lower for customers.
"If you could regulate the traffic so that in peak hours two lanes are fine, you don't need a third lane," Micek said.
Rather than the utility needing a huge reserve of energy to cover these peak times, smaller distributed sources of energy - perhaps generated by wind turbines or solar panels - could be used. And, ideally, customers would see no difference in the quality of electrical service they receive.
Traditional grids past prime
The idea of a smart grid first began about a decade ago, with the U.S. Department of Energy, according to Sunil Cherian, president of Spirae, a Fort Collins company that develops technology related to renewable energy.
The massive blackouts in the northeast part of the country in 2003 were a sign that the old way of providing energy through traditional power grids was not going to work forever, Micek added.
Couple that with rising prices for energy and a heightened knowledge of global warming issues, and you get the beginnings of smart-grid technology, where we are today.
"What does the grid of the future look like? It's not just one specific thing, but a collection of technologies," Cherian said.
While the power flow today generally goes from a large central plant, through distribution and voltage changes before reaching the customer, a smart grid can allow for more control on the user end.
"Speculation is that the 'smart' on the customer side could go into the item itself," Cherian said. For instance, a washing machine could be set to run outside of peak hours, and thus usage less expensive electricity. And a refrigeration cycle could be altered to use the least amount of energy, without letting food spoil.
Smart-grid technology also allows for more economical applications of renewable energy sources, like wind and solar energy, Cherian said.
Research hotspot
While much of this seems straight out of a futuristic movie, Cherian said it is not that far off, particularly for Northern Colorado. The region has become a hotspot for research and technological development for renewable energy, from smart-grid testing programs at Colorado State University - home to the world's only megawatt scale physical grid simulation, which also investigates the implementation of wind energy within the grid - to practical applications at New Belgium Brewing Co.
"We do have a fairly dense concentration of expertise," Cherian said. "A lot of companies have been focusing on this area and trying to build on technologies that are here."
Fort Collins is striving to become the home of one the first zero-energy districts in the nation. Backed by the Clean Energy Cluster and the city of Fort Collins, the Fort Zed project is aimed at creating a 45-megawatt area around downtown Fort Collins and the CSU campus that would be a net-zero energy user.
"The real objective is, through something like Fort Zed, to see is it really feasible to add these things to an area without having the price go up," Cherian said. "If it is successful, it will come from a mix of sources... (with) the carbon footprint reduced in the process."
While Fort Zed is still in the planning stage and still awaiting word on some federal grant funding, Cherian said he hopes it will be in place by the end of the year.
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