The Smart Grid and the EU Directive - An Opportunity for Today's Innovators

1. The Smart Grid and the EU Directive - An Opportunity for Today's Innovators Erich W. Gunther, PE, FIEEEEnerNex Chairman, CTO and Co-founder

2. What is Smart Grid? • Like beauty, it is in the eye of the beholder • A collection of specific functionalities among hundreds • Various governments have explicitly highlighted a few • Varying functional priorities • Dependent on: • Stakeholder point of view – which changes from time to time • Geography, regulatory environment, existing infrastructure • Corporate leadership, end consumer demographics and needs • A collection of technologies and systems that implement and manage these functions • Grid modernization from source to consumption

3. Grid Modernization Challenges • Large stakeholder base • Multiple optimization goals • Multiple engineering disciplines needed • Smart Grid must have demonstrable value • Multiple technological paths to achieving that value • Dynamic range of technology life is wide and challenging to mitigate • Pervasive deployment of renewable-variable and distributed generation • Electrification of transportation • System planning tools inadequate • Engineering assumptions/simplifications becoming less valid • A system of systems – presently managed using a silo based approach • Most people – even some good power engineers - are not system thinkers

4. Entrepreneurship and Innovation 101 • With change comes opportunity • From opportunity comes innovation • From innovation comes satisfaction, profit, and hopefully an improved way of life for those touched by what you develop

5. So what does that have to do with Smart Grid?

6. Change is Opportunity • Every industry depends on energy infrastructure – most critically so • Every aspect of the energy industry has never seen so much change in supply, cost, politics, and technology • Understand the change now, infer related future changes, see the opportunity, act on it with the best people you can muster

7. So What’s Changing? • Aging Infrastructure – no matter what else, this is one inescapable fact and leverage point • Rising energy cost due to scarcer resources • Increasing (apparent) social responsibility • Technology awareness and utilization • Consumer empowerment over everything • Self centered, egotism – “I want it now” culture • EU and national policy – not always a good thing

8. Some Data • EU produces 48% of energy needs, dependency on imports increasing • UK way better than most (Malta worst,Denmark best – they export) • In Austria, 68% of electricity generation wasprovided by renewable energy sources in2009 while the EU average was of 18%. • EU energy targets: 20-20-20 BY 2020– emissions, renewables, efficiency (UK 15% renewable) • UK Climate Change Bill – carbon down 80% by 2050 • UK household energy prices among the highest in EU

9. Opportunities • Consumer empowerment (measurement, demand response) • Energy efficiency related technology • Infrastructure improvement (the grid – lines, transformers) • Distributed renewable energy – photovoltaics • Bulk renewable energy - wind • System integration tools • Big data and analytics • Energy storage • Field device communications • Electrification of transportation • Labs for testing, compliance evaluation and certification

10. Systems Engineering Discipline Development of conceptual, component & reference models and architectures allows you to examine smart grid implementations from a number of architecture perspectives:Operational, System, Technical • Use Cases and Business Scenarios • Requirements • Information Needs • Technical capabilities required to support smart grid functions • Component Architectures • Message Architecture • Reference Architecture • Open standards available to support architecture • Vendor solutions and offerings • Enabling enterprise standards, patterns and services

11. Example – US “Green Button” • Common sense idea – consumers own energy use data, have access to it in a standard format, apps and services available to use it – a policy, a brand, a set of technologies • White House idea to first implementation in 90 days • Utilizes new, fast tracker technical standard (ESPI) • Lots of political haymaking, satisfied customers, market for apps, low cost energy provider implementation • 10 million customer accounts have access now, 20 million more associated with utility commitments • > 70 vendors offering products and services • 55 entrepreneurs participate in US DoE Apps for Energy contest - http://appsforenergy.challenge.gov/submissions

12. Motivation to Get it Right

13. Guy Kawasaki Rule on Entrepreneurship • Make Meaning, Get Going • Increase the quality of life • Right a wrong • Prevent the end of something good • Think different • Polarize people • Find a few soul mates – “the best people”

14. Best People - Smart Grid Engineer Skills • Basic electrical and electric power engineering • Electronics, load flow, short circuit, stability, transients • Communications • Physical media, protocols, info models, networks, traffic analysis • Distributed Computing / Intelligence / Complex Systems • Software, agent based computing, local automation, stochastic processes • Security • Physical and cyber • Systems of Systems Engineering • Integration, control theory, reliability, stability, security • Enterprise Architecture • Databases, Service Oriented Architecture • Business, Economics, and Regulation • Understanding the business, cost/benefit, business case • People Skills • Needed to break down silos in institutions and understand customer needs

15. Advice for Engineers and Technologists • Think globally – in system of systems terms • Systems engineering discipline is critical • Everything matters • Thoroughly understand power system • Thoroughly understand system requirements • Evaluate widget and other actor interactions • Manage technology change • Understand the business case • Build in metric capture • Support dynamic optimization • Keep your eyes open • Don’t reinvent – collaborate instead • Continuous learning and self improvement

16. Advice for Employers • Clearly articulate your resource needs to universities • Reward universities who listen – projects, internships • Hire system thinkers • Avoid creating “siloed” professionals • Encourage continuous learningand self improvement • Training programs, rotation • Collaborate with your peers • UCAIug, SGIP • Keep your eyes open • Don’t reinvent – be aware of industry resources and use them • IEEE Xplore • User communities - UCAIug

17. Summary • Change brings opportunity and profit • Critical infrastructure brings large customer base • Learn, Observe, Listen, Integrate, Collaborate • Apply technology from multiple disciplines • Understand the context of energy engineering • Be realistic but optimistic • Do something meaningful • Hire the best people – find soul mates • Have fun, make money – be an innovator!

18. Questions? • Links • IEEE Smart Grid – http://smartgrid.ieee.org/ • IEEE Xplore - http://ieeexplore.ieee.org/ • IEEE PES - http://www.ieee-pes.org/ • European Energy 2020 Strategy - http://ec.europa.eu/energy/energy2020 • EU Energy Roadmap 2050 -http://ec.europa.eu/energy/energy2020/roadmap • Apps for Energy - http://appsforenergy.challenge.gov/submissions • Green Button – http://www.greenbuttondata.org/ • EnerNex – http://www.enernex.com/ • Contact • Erich W. Gunther – e.gunther@ieee.org