The drive towards smart grids

18 April 2018 (Last Updated April 18th, 2018 10:28)

The need to mitigate climate change and ensuing strong government support mechanisms for renewable energy development and energy efficiency, are driving smart grid initiatives across the world.

The drive towards smart grids
A number of governments are increasingly viewing smart grid technology as a strategic infrastructural investment that will enable their long-term economic prosperity. Credit: Courtesy of Lars Plougmann

The need to mitigate climate change and ensuing strong government support mechanisms for renewable energy development and energy efficiency, are driving smart grid initiatives across the world. A number of governments are increasingly viewing smart grid technology as a strategic infrastructural investment that will enable their long-term economic prosperity and help them to achieve their carbon emission reduction targets.

The EU introduced a strategic energy technology plan in 2006 for the development of a smart electricity system over the following 30 years. If the EU is to meet its 2020 targets of increasing energy efficiency by 20%, increasing its share of renewable energy by 20% and reducing its greenhouse gas (GHG) emissions by 20%, it must modernise and liberalise its aging electricity grid, create economies of scale for renewable energy, and promote consumer efficiencies.

In 2016, the European Commission proposed a 2030 energy strategy focusing on achieving the energy efficiency target of 30%, a 40% cut in GHGs emissions compared to 1990 levels, at least a 27% share of renewable energy consumption, and at least 27% energy savings. The United Nations’ (UN) 21st Conference of the Parties (COP21) focused on stabilising atmospheric concentrations of GHGs to avoid dangerous anthropogenic interference with the climate system. COP22 and COP23 focused towards the progress of development of the rules and guidelines taken under COP21. COP21 established specific actions and targets for reducing GHG emissions, and mitigating and adapting to the effects of climate change. The central goal of the agreement is to keep the global average temperature rise below 2°C and as close as possible to 1.5°C. Such strong global climate change policies and regulations have enhanced the global smart grid outlook.

Every country, when creating a smart grid roadmap or implementing a smart grid, creates its own Smart Grid Task Force (SGTF) or Smart Grid Association with the major stakeholders, which are usually utilities, key equipment manufacturers, electricity market participants, research associations, and government bodies. Associations such as the International Energy Agency (IEA), International Smart Grid Action Network (ISGAN), and the Global Smart Grid Federation (GSGF) also create roadmaps, papers, and other helpful material to support countries in the development of smart grid technology.

There are no established smart grid standards. International agencies, such as the International Electromechanical Commission (IEC) and the Institute of Electrical and Electronic Engineers (IEEE), along with the EU have developed standards aimed at helping countries to develop their own individual standards. The IEC has published more than 100 standards for smart grid technologies, including advanced metering infrastructure (AMI), communication protocol, distribution automation, substation automation, distributed energy resources, energy management systems (EMS), distributed management systems (DMS), electric vehicles (EVs), flexible alternating current transmission system (FACTS), storage, smart home, and high voltage direct current (HVDC). IEEE has developed numerous standards for smart grids. The topics vary from smart equipment, interoperability, communication, smart meters, and grid automation.

Several countries already have net energy metering protocols and equipment in place, and a number of countries are exploring the technology and mechanism. In the US, 45 states and 4 territories have mandatory net metering rules. The net metering caps are available for solar and wind renewable sources within the country. The number of net metering customers in the US increased from 0.16 million in 2010 to over 1.83 million in 2017. Under AMI, as of 2017, the country installed around 76 smart meters and is expected to install over 90 million by 2020.

In the US, the total cumulative sales of EVs reached 540,000 as of December 2016. In the first half of 2017, around 90,302 EVs were sold. There are now more than 16,000 publicly accessible charging stations, up from 500 in 2008, giving electric car owners more confidence in the range of their vehicles.

In Mexico, in February 2017, CRE established new rules and mechanisms for net metering, net billing, and sale of electricity as well as model contracts for the connection of small-scale solar generation sites to the grid and terms of sale of the electricity they produce. Earlier individual homes and businesses were only permitted to produce PV energy for their own consumption without the possibility of selling the power they produced. According to the new regulatory framework, individual producers can sell their electricity and help in expanding the distributed generation infrastructure.

In 2016, ANEEL implemented a net metering system in Brazil that would enable customers to connect their micro-generation system to the Brazilian power grid with ease. By May 2017, over 10,000 PV systems had been installed in Brazil under the net metering scheme with a combined capacity of 78 MW. ANEEL is aiming to reach 1.2 million PV systems under net metering by 2024. In June 2017, Landis+Gyr signed contracts for AMI deployment in Brazil. The State Electricity Distribution Company selected Landis+Gyr for the data collection and management of commercial and industrial users, and the supply and installation of a centralised measurement system for residential energy consumers.

India has a target of installing 130 million smart meters by 2021 under Smart City Initiatives. The government has made it mandatory to install the smart meters for consumers whose monthly electricity consumption was 500 units and more at the earliest by December 2017 and consumers with the monthly consumption above 200 units by 2019. In October 2017, the Larsen and Turbo Company won the government tender to supply 2.5 million smart meters. The government tender was released for the supply of 5 million smart meters; 13 companies participated in the bidding process. The remaining 2.5 million smart meters would be procured from the other five companies who participated in the bidding process. In the initial phase, 4 million smart meters will be used in Uttar Pradesh and the rest in Haryana. Bihar, Jharkhand, Gujarat, and Delhi are among other states that are keen on deploying smart meters.

In 2013, China overtook the US and became the largest smart grid market. The country invested $4.3 billion in smart grids, which accounted for more than one-quarter of the $14.9 billion spent globally in that year. SGCC planned the development of the smart grid in China in three phases. The first phase (2009–2010) involved planning and conducting smart grid pilot projects in order to study the technology. At the first phase, SGCC planned to invest $77.8 billion including a $9.2 billion investment into smart grid technology. Following this, the government released a list of criteria of importance for smart grid and smart grid standards to be followed in the country. The second stage involves the roll-out and construction of smart grids, including the development of smart grid standard and technologies, including operational smart grid management systems, wide spread deployment of smart meters, and enough EV charging stations. This phase, which commenced in 2011, was completed in 2015. Following this, phase three (2016–2020) will involve improving the smart grid system throughout China.

China has the largest number of NEV charging stations in the world with 214,000 public NEV charging points as of 2017. The number of public charging points in China grew by around 51% in 2017. According to China’s 13th FYP (2016–2020), the country plans to build a nationwide charging-station network that will fulfill the power demands of 5 million EVs by 2020. According to the China Association of Automobile Manufacturers, a total of 777,000 fully electric and hybrid vehicles were sold in the country in 2017. In August 2017, 55,000 new passenger electric cars were registered in the country, growing by 68% compared to August 2016. From January to August 2017, over 282,000 electric cars were registered. According to the Bank of America Merrill Lynch, China is expected to maintain a 50% share of global pure EV sales until 2030.


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