The Energy Internet aka The Smart Grid – Putting It All Together

An Introduction

The Way It Is

Stuck in the Television Age

The Way We’re Going

The Energy Internet

The Supergrid

Making the Intermittent Regular

The Regional Grid

Building a Two-Way Street

The Local Grid

Matching Demand to Supply

Potential and Pitfalls


An Introduction

In the 1950s, families gathered around television sets as big as lounge chairs, their rabbit-ear aerials capturing signals broadcast by the big networks. TVs haven’t really progressed much since then – they’re still “dumb.” That is, they’re nothing more than passive receivers at the end of a one-way street. Sure, you can change the channel or turn down the volume, but compared to your computer, a TV has no real smarts. Our electrical system is just as old – and just as dumb.

The power plants and cables that make up the electrical grids of the industrialized world are arguably the largest machines ever built. Constructed around the time TV and radio were still considered high-tech, they were designed in much the same way: Houses and factories passively receive energy sent over the grid by big, centralized power plants. You can turn off a light bulb or turn down the thermostat, but there’s no communication and no storage. It’s a one-way street.

Just as the Internet forever changed the way information is made, shared and stored, so the Energy Internet – sometimes called the smart grid – will change the way we produce, distribute and store energy. Bringing together computers and communications, clean power and energy efficiency, the Energy Internet is an Internet of things, an interconnected web of smart homes, appliances, cars and power plants.

When your home joins the Energy Internet, it taps into a huge network of energy exchanges happening in real time all across the country. Your dishwasher, for instance, will negotiate with the utility for the best rates, and switch on when power is clean and cheap. The utility will talk to your thermostat and hot water heater, and you’ll scarcely notice as it temporarily turns one down when the grid gets overloaded.

On a grander scale, utilities will bring up tidal power on the west coast when the wind dies down in the east, or turn off biogas plants in New York when the sun is shining brightly in Nevada. Efficient high-voltage DC lines (HVDC) will distribute that power across continents. Rooftop solar panels and windmills, even the electric car sitting in your driveway, will form part of a new, countrywide grid of distributed production and storage.

Sounds cool, but the lights go on now. Can’t the old grid do the job? The simple answer is no. Just like email needs the Internet, large-scale renewable power will only work in conjunction with an Energy Internet. We can’t kick the fossil fuel habit without it. Let’s find out why, and take a look at what the world might look like with a smart grid.

But first, let’s take a look at how our grid got stuck in the Television Age.

The Way It Is

Stuck in the Television Age

Our utilities1 are a legacy from another era, a time when energy was cheap, carbon dioxide wasn’t a problem, and computers were the size of warehouses. They are dumb, closed and disorganized, and run by brute force. 2 It’s difficult for renewables to muscle their way onto this scene.

Since utilities are paid3 to make power, not conserve it, they meet increased demand with more supply. After all, what company wants to sell less4 of its product? Utilities add power plant after power plant – many of which spend most of their time sitting idle. That’s because the utilities build enough plants to meet peak demand, which we may only hit for a few hours each year.

When Germany beat England in penalty kicks in the World Cup in 1990, English fans drowned their sorrows in a cup of tea. Plugging in all those kettles at the same time demanded enough energy to power a city of a million people. That can bring a grid to its knees. How to respond? “Most of the flexibility is provided by fossil fuel power stations,” says Stewart Larque, spokesman for the UK National Grid. Imagine a massive Christmas-decoration factory that sits idle all year, then churns out enough decorations for every house the day before Christmas. That’s how our grid meets demand for electricity.

The utilities couldn’t reduce demand by much even if they wanted to. They can’t change the price from moment to moment – or communicate that price to the customer. Nor can they turn off unnecessary equipment, or force those kettles to feed into the grid more slowly. That requires two-way communication.5 Dumb grids mean more brute force.

Dumb grids are closed grids – they can’t connect to a bunch of small and medium-sized renewable projects spread out over hundreds of miles. Your local grid is designed like a giant wheel, taking power from a central plant and spreading it outward. It’s not easy to plug in renewables out on the spokes of the wheel.

On a national scale, grids are like a hodgepodge of tangled wires that can’t effectively distribute power over long distances. The US grid is one of the worst offenders, with more than 3,000 local utilities tangled up into three large, regional grids. As New York Times columnist Thomas Friedman puts it, sending power from the east coast to the west coast is like “trying to drive across America, from New York to Los Angeles, without our interstate highway system – taking just state and local highways – and using only county maps to figure out where you were going.”5 We need to move renewable energy from where it’s made – places like the sunny Mojave Desert and the windy Great Plains – to the cities that need it.

The Way We’re going

The Energy Internet

The Energy Internet is an Internet of things – cars, appliances, power plants – woven together into a choreographed dance of energy by a humming buzz of power lines and wireless communication.

Renewable-energy power plants, transmission lines, electrical meters, appliances, and even the solar panels on rooftops and electric cars in driveways will be able to talk to each other in real time, while sharing power. Their conversation will be about electrical loads, wind speeds and energy prices. Companies like General Electric, IBM and Cisco are already developing the language the Energy Internet will speak.

Power plants may play a starring role, but this dance gives equal time to transmission, storage and consumption. From the dishwasher in your kitchen, all the way up to giant offshore wind farms, no part of the Energy Internet acts in isolation, but rather, as part of a coordinated whole. Demand for energy will change based on the power that’s available. The power that’s available will depend not just on the wind, sun and tides, but also on demand itself and how much energy has been stored.

Think of the Energy Internet as a mix of three scales of grid: national, regional and local. The national scale lets large renewable plants compete with coal and nuclear, by allowing them to act in concert and back each other up. The regional scale makes it easy for lots of smaller, local renewables to plug in. And the local scale completely changes how we demand energy and lets every customer play in the power game.

The Supergrid

Making the Intermittent Regular

Highly efficient HVDC transmission lines will link renewable energy plants spread across continents – not  just to the cities that need it, but also to each other. It’s called “grid balancing,” and it makes renewable energy production more predictable and reliable. When one energy source diminishes, another comes online. As wind in one region dies down, for example, it may pick up thousands of miles away. When the tides turn on the west coast, hydro or solar power in the east comes online. Grid balancing also includes storage, often in the form of pumped hydro,7 which can act as a backup to the whole system.

That’s still a ways off. But there are exciting projects happening right now. Europe’s Airtricity is planning a network of underwater HVDC cables – called the Supergrid – to tie together offshore wind farms all around Europe, from the Atlantic to the Mediterranean. Covering an area large enough to contain different weather patterns8 the Supergrid is expected to increase the capacity factor of offshore wind farms from 40% to 70%,9 as well as to provide a single, continent-wide electricity market. The first phase of the project, covering the UK, Germany and Holland, is expected to provide enough electricity for eight million homes, and the grid portion will cost more than $2 billion. There are already HVDC lines across the English Channel and in the US.

The high-powered DESERTEC Foundation, based in Berlin, envisions much more than just wind farms (see Solar page). Add large-scale solar throughout North Africa, biomass in France and geothermal from Iceland. Then add storage, so that when the wind howls over the Atlantic, water flows uphill in Norway’s pumped hydro storage reservoirs. Each of these power sources knows just what the others are up to and coordinates the power loads across many different sources. This is the backbone of the Energy Internet.

European leaders are already committed to the idea, particularly those in the UK and France. And US President Barack Obama and Jon Wellinghof, head of the Federal Energy Regulatory Commission, have both caught the Supergrid bug, which means HVDC lines may soon crisscross America. “There’s 500 to 700 gigawatts of developable wind throughout the Midwest,” says Wellinghof, and “enough solar in the southwest, as we all know, to power the entire country. It’s a matter of being able to move it to loads.” 10

Supergrids like these require vision, capital and big engineering resources. But this is just the sort of large-scale, multisourced grid we need to catapult renewable energy production from a niche industry into something that can compete head-to-head with nuclear and coal. Renewables have always been criticized for just not being reliable enough. The Supergrid puts that issue to rest.

The Regional Grid

Building a Two-Way Street

In the existing grid, power from central plants flows one-way though a tangle of ever-smaller wires. Those wires weren’t designed to take in power; they were designed to deliver it. But renewable energy will be composed of lots11 of smaller plants scattered across the grid – tidal turbines, community-owned wind farms, solar panels. Called “distributed production,” it requires two-way wires. The Energy Internet, like the Internet itself, is about access.

Distributed production will include releasing power that was previously stored. Thousands of fuel cells and hydrogen tanks that have replaced the backup diesel generators in buildings across the country will do double-duty – storing power for backup, but releasing some into the grid at peak demand. Fuel cells12 produce electricity from hydrogen, but can also run in reverse, producing hydrogen when fed electricity. They’re like powerful batteries, with storage capacity limited only by the size of the hydrogen storage tank. Fuel cells clearly need a two-way street.

Smart power electronics will help create a two-way street for electricity. When power is available, energy flows one way. When power is needed, it flows another. Renewable energy production becomes “plug and play,” anywhere and anytime. Creating regional two-way grids for energy is a big job. If building a national grid is like building a new house, updating the regional grid is like a long, complicated renovation.

Everything that’s connected to the Energy Internet, from power electronics to wind farms to fuel cells, will be embedded with sensors and constantly monitored. Power flowing at every point will be measured. That’s a lot of real-time information to manage, and California-based Silver Spring Networks is getting ready to do just that. Partnering with electronics and communications companies like GE, ABB and Cisco, it’s building the software a utility will need to manage this new “Internet of things.”

The Local Grid

Matching Demand to Supply

Imagine if your air conditioner, refrigerator and washing machine were smart enough to bid for energy, turning on only when it’s cheapest. You’d barely even notice – your fridge, for instance, might power down for a few minutes, but the light would still flick on when you opened the door. Your air conditioner might turn off, but the fans would still circulate air. Your coffeemaker’s element might turn off for seconds at a time, but the pot would stay hot.

Now picture your electric car as a smart, miniature power plant that charges up in your driveway at night when energy is cheap, and sells power back to the grid while you’re at work. It’s smart enough to hold on to enough power to get you home. And if you plug it into your friend’s outlet, the utility knows whom to bill for the power. Same goes for the solar panels on your roof – they’ll sell power to the grid during the day, when you’re not using the energy they produce.

The local grid is where the Energy Internet really shows its smarts. It doesn’t take much – each component has a chip inside that talks to the grid. But all that intelligence adds up, letting utilities adjust demand just like they adjust supply. The best part is, you’ll hardly notice. We saw in the Efficiency and Conservation page that negawatts, reducing energy demand, is the single most effective energy source available. The Energy Internet is what really ramps up the negawatts.

It’s called demand response,” and doing it in real time is just as important to renewable energy as production. Demand decreases during peak load, eliminating the need for all that standby power. When wind farms pick up at night, demand increases to make sure every bit of that clean power is used. If there aren’t enough dishwashers waiting for cheap, clean energy, then millions of cars across the country store it, releasing it back when demand rises again. (By the way, those smart dishwashers aren’t far off – appliance-maker Whirlpool has announced that all of its appliances will be compatible with the Energy Internet by 2015.)

How important is demand response? In California today, the last 10% of power production is used less than 1% of the time. That means that if the state could adjust demand for only 57 hours a year, one-tenth of its power plants could be mothballed. That’s just the start. Some studies show that new American generation capacity required by 2030 can be cut roughly in half13 with aggressive demand management.

The Energy Internet turns customers into mini-utilities. And just like mobile phone companies, utilities will start to offer all sorts of different deals. Clean and Green” might emphasize nighttime consumption. “Mini Utility” might put your car and solar panel at the center of your own grid, and “Keep It Simple” might ignore all demand response – but cost a lot more.

Potential and Pitfalls

The Energy Internet is not optional. If renewables are going to hit the big leagues, it’s absolutely crucial. All three scales of grid – national, regional and local – add a piece of the puzzle. The vagaries of the wind and sun are washed away in a continent-wide, balanced grid. Cities become utilities, because the big buildings are all equipped with fuel cells. Coal plants no longer sit idle, waiting for all of England to plug in their kettles at halftime. And consumers rule – their coordinated demand response is equivalent to the biggest power plant on the planet.

The best thing about the Energy Internet is that it doesn’t require a lot of new inventions, but simply the application of existing technologies. One pitfall, however, is the sheer scale required – the Energy Internet is going to cost a lot. Each mile of HVDC transmission costs about $1 million (and that doesn’t include the connecting equipment). Connecting wind and solar plants across continents requires thousands of miles of HVDC transmission. Upgrading all the power electronics of the regional grids is also expensive – some estimates are as high as $500 billion for the US alone.

Another pitfall is that there’s not a lot of experience in real-time operation of continent-wide, distributed power production systems. There are bound to be a few complications along the way.14 The Energy Internet is a huge interplay of software, wireless devices, homes, factories, power plants, transmission lines and customer responses. Even if each were well understood on its own, it shouldn’t surprise us if unforeseen behaviour emerges as all these components are brought together. A new systems engineering theory will probably result.

But the potential is enormous. Without the Energy Internet, we’ll be stuck in the Television Age. With it, our energy infrastructure will finally enter the 21st century: smart, connected, versatile-and clean.