Wednesday, April 7, 2010

Is the Smart Grid Really Very Smart?



"Jonathan Koehn, Boulder's regional sustainability coordinator, said the city has never gotten an answer on who should pay for the project and whether the final cost is justified in terms of operational and environmental savings." ----Feb. 2010

October 27, 2010 UPDATE: Please don't miss this recent article, Smart Grid: Ten Trends to Watch in 2011 and Beyond.

July 25, 2010 update: Today's front page news is a f/u of this story, and things are sounding even worse than I wrote this three months ago. Here is a link to the latest article. "State regulators question prudence of Boulder's smart grid"


Boulder To Get the Nation's First Smart Grid Announcement Came March 2008
My town of Boulder, Colorado has historically been a leader in technology, innovation, urban planning, the eat local food movement, natural foods products, and has led the way on environmental issues. So, it came as no surprise in March of 2008, when it was announced that Boulder would become the nation's first city to install a smart grid. Excel Energy and various politicians enthusiastically promoted the plan.

On the Boulder city website back in March 2008:

In a visionary move to create the nation's first fully-integrated digital electricity system, Boulder and Xcel Energy will partner to bring to life a Smart Grid in the City of Boulder. Xcel Energy has announced a consortium of partners who have each committed to developing the Smart Grid City in Boulder over the next two years. The fully integrated investment is expected to be up to $100 million.

In keeping with the city's reputation as a high-tech hub and capitalizing on its environmental awareness, Boulder will become a proving ground for innovations that will enable residents and businesses to optimize the use of renewable energy sources, increase energy conservation options and minimize its collective environmental footprint. Smart Grid also promises to deliver more reliable energy, and businesses and residents in Boulder will experience fewer power outages and enhanced response times.

From the Xcel March 2008 news release, the benefits are supposed to include:
...operational savings, customer-choice energy management, better grid reliability, greater energy efficiency and conservation options, increased use of renewable energy sources, and support for plug-in hybrid electric vehicles and intelligent-home appliances.

Interim
Being a resident here, all I've really noticed with the installation were power outages and trucks and people working in backyards and around town. I'm guessing there were power outages 8-12 times where I live, sometimes a half a day, sometimes only a few minutes. A few months ago, a note on our front door announced that we would be getting a meter sometime. That hasn't happened yet.

Fast Forward to the Present, exactly two years later . . .
21,000 homes here are now connected to the smart grid, with different levels of functionality. Recently, there were two disturbing articles about cost and a multitude of other problems with the condition of our smart grid in our local paper.

Problem #1. Cost. Estimated capital expenditures were to be $15 million and now the expected cost has nearly trippled to $42 million not including the costs of operating and maintaining the grid. Customer rates have recently increased 8 percent to help cover costs. Cost over runs were expecially related to the installation of 200 miles of fiber optic cable. (In the initial announcement $100 million of private at-risk money was to go towards the project in the name of intellectual property accumulation which now apparently has no publicly transparent accounting.) See, "Daily Xcel smart grid costs blow up, PUC orders more transparency."

Problem #2. According to Anne Butterfield, a Daily Camera columnist who wrote, "Boulder's SmartGridCity is looking dim":

SmartGridCity was supposed to be so promising. But it`s not. The sad truth is that the SmartGridCity has been mired in a deepening buzz of criticism including: the system is obsolete, grossly overbuilt, ham-handed, designed to benefit the company more than Boulder; the project has seen pivotal personnel losses and SmartGridCity has been absent from various relevant conferences.

That is actually a whole basket of problems and frightening, no less, for something as important as the electrical grid.

Problem #3. To date, there has been no Certificate of Public Convenience and Necessity completed by Excel. This should be standard with this type of project.

Problem #4. Cybersecurity. From this concerning article, "'Smart-grid' system vulnerable to hackers":
Determined hackers with as little as $500 worth of equipment and some computer know-how could cripple the smart-grid technology being piloted in Boulder and rolled out nationwide, security experts say.
And, 'Smart' meters have security holes.
This problem has not been addressed here in Boulder, either.

Problem #5. Big brother aspects abound including accessibility to your usage patterns and times, knowing your sleep schedule, when you are on vacations, and many other issues. Additionally, your power company may be able to control your thermostats and appliances.

Smart Grid as part of the American Recovery and Reinvestment Act of 2009
On a national level, the Obama administration has made smart grid installations a priority across the nation by including it in the American Recovery and Reinvestment Act of 2009. If you want to see how your taxpayer dollars are being spent on smart grid installations and where, go here to this gov. website which includes a map, list of towns, and projected costs.

As an example, let's look at one county in Nebraska:
Cuming County Public Power District, located in West Point, Nebraska will receive $1.8 million in federal funds to develop a smarter energy grid. The U.S. Department of Energy chose Cuming Country Public Power District as one of 100 companies nationwide to receive federal stimulus funds as part of the American Recovery and Reinvestment Act of 2009. (And it is projected that they will cost-share 50% of the final costs, or $1.9 million.)

Conclusion

I've been called a Luddite before, and quite honestly, this project scared me from the day it was announced, because I'd prefer to let someone else be the "guinea pig" when it comes to adding unproven complexity to the power grid. I figure when you keep things as simple as possible, they are going to be more fool proof, easier to maintain, less expensive, and more reliable.

One of a smart grid's goals is to allow wind and solar energies to supplement current electrical generation methods. Europe is moving on these smart grid projects, too. Others believe we should be going nuclear instead.

Smart grids are also being touted for the coming day of electric cars. And the success of electric cars remains to be seen. As a less expensive alternative, electric wall timers could be used for charging EV's or appliances.

Is the SmartGridCity a boondoggle? We will find out a number of years from now. Once started, with federal money behind them, these projects can take on a life of their own due to special interests. Just look at corn ethanol. Our nation's high debt level dictates prioritized discretionary spending in the future starting now. In this deflationary environment, electrical consumers, both private and commercial, have less to spend, so increasing electrical utility costs is undesirable.

Modernizing our electrical grid, making it more efficient, and doing the things necessary to help prevent major and minor blackouts is good and necessary. But, first, do no harm. In the effort to ensure our electrical security, let's not make it less secure. Even our town's sustainability coordinator asked very recently "whether the final cost is justified in terms of operational and environmental savings." That, says a lot.
--Kalpa



Also, see 2/9/2009 WSJ Article: The More You Know....A groundbreaking 'smart grid' test in Boulder, Colorado is delivering some surprises for both consumers and utilities

Article Updates:
For the Smartgrid, a 'Synchrophasor', GreenInc
Of Smart Meters and Smart Consumers, NYT


For-what-it's-worth: CNBC SMART GRID VIDEO
Building a Smart Grid - Discussing the merits and costs of creating a smart grid to meet the country's energy needs, with Peter Corsell, CEO of GridPoint (2:48 minutes)





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