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BACKGROUND VISION AND DRIVERS INVESTMENT PRIORITY RESEARCH NEEDS

DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS. BACKGROUND VISION AND DRIVERS INVESTMENT PRIORITY RESEARCH NEEDS. Kevin Doran 9 Feb 2011 | RASEI Fellows Meeting. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS. BACKGROUND.

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BACKGROUND VISION AND DRIVERS INVESTMENT PRIORITY RESEARCH NEEDS

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  1. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS • BACKGROUND • VISION AND DRIVERS • INVESTMENT • PRIORITY RESEARCH NEEDS Kevin Doran 9 Feb 2011 | RASEI Fellows Meeting

  2. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS BACKGROUND

  3. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS BACKGROUND: THE NORTH AMERICAN ELECTRIC GRID US = ~26% of total world installed generation capacity in 2012 • 3,200 electric utility companies • 17,000 power plants • 800 GW peak demand • 165,000 miles of high-voltage lines • 6 million miles of distribution lines • 140 million meters • $1 trillion in assets • $350 billion annual revenues Source: DOE 2011

  4. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS BACKGROUND: NHRE Generation growth • NHRE generation = ~1/4 of electricity generation growth from 2009 to 2035 in AEO2011 Reference case • Reference case projects NHRE generation growth will equal ~9.2% total generation capacity in 2035

  5. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS BACKGROUND: Re Generation Capacity by Source, 2009-2035 (gigawatts) • Total NHRE increases from 47 GW in 2009 to 100 GW in 2035. • Largest increase is wind, but because PTC expires in 2012, projection has 73% of grown occurring from 2009-2012 (18.2 GW) • Projection has wind increases at just 6.9 GW from 2012 to 2035 • Solar increases 5-fold Source: EIA, AEO 2011

  6. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS BACKGROUND: Annual Electricity Generation Capacity, 1985-2035 (gigawatts) • Total capacity additions from 2010 to 2030 = 223 GW • Annual builds from 2012 to 2025 = below 7 GW per year • From 2025 to 2035, average annual builds = 11 GW per year • During this period, 80% of this capacity is NG Source: EIA, AEO 2011

  7. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS 70%

  8. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS VISION AND DRIVERS

  9. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS VISIONS FOR the GRID OF THE FUTURE Enable a seamless, cost-effective electricity system, from generation to end use, capable of meeting the clean energy demands and capacity requirements of this century, while allowing consumer participation and electricity use as desired: • Significant scale-up of Clean Energy (80% by 2035) • Allows 100% customer participation and choice (including distributed generation, demand-side management, electrification of transportation, and energy efficiency) • A 100% holistically designed system (including AC-DC hybrid configurations) • Global competitiveness and leadership • A reliable, secure, and resilient Grid Source: DOE 2011

  10. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS VISIONS FOR AND DRIVERS OF GRID INNOVATION DOE’s Clean Energy Goals: • By 2035, 80% of America’s electricity will come from clean energy sources • Put 1 million electric vehicles on the road by 2015 • Energy related GHG emissions will reduce 17% by 2020 and 83% by 2050 Targeted Outcomes for the Grid: • Enable better understanding and control of our electric grid by installing more than 1000 synchrophasor measurement units by 2013. • Deploy more than 26 million smart meters in American homes and businesses by 2013. • Reduce utility-scale energy storage costs 30% by 2015. • Policies drive markets which drives technologies • When finding solutions to grid challenges, all aspects need to be considered simultaneously Generation, infrastructure, smart grid, electric vehicles, storage, etc. Grid Business models, cost allocation, wholesale power trading, utilities, vendors, etc. State RPS, federal CES, FERC, PUC’s, environmental regulations, siting, etc. Source: DOE 2011

  11. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Unconventional vehicles meet over 40% of U.S. light-duty vehicle sales in 2035 Total Flex-Fuel Micro Hybrid Diesel Electric Hybrid Plugin and all-electric Source: EIA, AEO 2011

  12. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS VISIONS FOR AND DRIVERS OF GRID INNOVATION The Traditional Paradigm “Electricity as a Commodity” • Passive consumers • One-way flow of power and information • Few incentives for energy savings • … Enabling an Electricity Services Economy “Electricity as a Service” • Access to clean energy generation and options • Delivery of desired power quality when it is wanted • Customer participation into electricity markets (demand response) • Customer flexibility to use new technologies (electric vehicles, distributed generation, energy management system, etc.) • Dynamic protection, privacy, and cyber security • … Source: DOE 2011

  13. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Drivers: A LAUNDRY LIST Changing Supply Mix • Increased reliability, efficiency, safety of the power grid • Aging infrastructure • Increasing energy demand; need to ensure security of supply • Integrating intermittent energy sources • Enabling decentralized power generation (allowing net metering and consumer interactivity) • Need to deal with microgrids—i.e., requires new technology to integrate with larger grid • Desire for lower energy prices • Sustainability considerations • Increase GDP through job creation • Smart-grid enabled automation as a means of dealing with retirement of experienced workers • Opportunities to use customer data to control demand and open up new data markets • Increased revenue generation, including regulatory compensation and lower total cost of ownership • Regulatory compliance • Customer satisfaction and public image • Utility challenges, e.g., • Increasing costs and regulatory pressures, including restructuring and retail deregulation • New loads and consumption models, such as electric cars and smart buildings • Long distances between generation and consumption • Distributed generation - Requires additional transmission - Requires control/communications Demand Transformation - Expanding Digital Economy - Power quality needs - Demand growth Complexity of Grid - Expanding footprint - Overlay of markets - Operating “closer to the edge” Infrastructure Vulnerability - Interdependencies of electric and energy systems Source: DOE 2011 INCREASING DRIVERS

  14. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Drivers: the future grid—what it should look like It should be capable of: • Enabling informed participation of customers • Accommodating all generation and storage options • Enabling new products, services, and markets • Providing the power quality for a range of needs • Optimizing asset utilization and operating efficiency • Providing resiliency to disturbances, attacks, and natural disasters How do we get there? • Grid components and subcomponents • Materials innovations • System integration and distributed technologies • Grid energy storage and demand response • Analysis, standards and model development • Planning, policy and other non-technical support (e.g., markets, regulations, environmental considerations) Source: DOE 2011

  15. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS INVESTMENT

  16. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS INVESTMENT: U.S. Smart grid investment grants Geographic Coverage of Selected Projects 18 million smart meters 1.2 million in-home display units 206,000 smart transformers 177,000 load control devices 170,000 smart thermostats 877 networked PMUs 671 automated substations 100 PEV charging stations Source: DOE 2011

  17. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS INVESTMENT: GRANT PROJECT TYPES • Advanced Metering • Customer Programs & Services • Equipment Manufacture • Distribution Systems • Transmission Systems • Integrated / Crosscutting “Integrated and/or crosscutting systems add smart grid functions to multiple portions of the electric system or integrating multiple smart grid capabilities. Projects in this topic area involve equipment and/or software applications that cover two or more of the above topic areas such as: AMI and electric distribution systems; customer systems and AMI; or electric transmission systems and electric distribution systems.” (DOE, smartgrid.gov) Source: DOE 2011

  18. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS INVESTMENT: TOTAL AARA FUNDING FOR THE GRID • “President Obama has announced the largest single grid modernization investment in U.S. history, funding a broad range of technologies to spur the nation’s transition to a smarter, stronger, more efficient and reliable electric system… The $3.4 billion in investments are part of the American Reinvestment and Recovery Act, and will be matched by industry funding for a total public-private investment worth over $8 billion.” • “Secretary Chu announced that the Department of Energy is awarding $620 million for projects around the country to demonstrate advanced Smart Grid technologies and integrated systems… These 32 demonstration projects, which include large-scale energy storage, smart meters, distribution and transmission system monitoring devices, and a range of other smart technologies, will act as models for deploying integrated Smart Grid systems on a broader scale. This funding from the American Recovery and Reinvestment Act will be leveraged with $1 billion in funds from the private sector to support more than $1.6 billion in total Smart Grid projects nationally.” • Overall, of ARRA’s $787 billion, $45 billion went to the Department of Energy, with 11.5 intended for the grid and around $4 billion for smart grid.

  19. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS INVESTMENT: Global investment in the grid • International Energy Agency estimates: • $38 trillion through 2035 to meet global energy demand • $16.9 trillion for power/generation infrastructure (45% of total) • 50% in generation • 50% in transmission and distribution Source: IEA, WEO 2011

  20. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS PRIORITY RESEARCH NEEDS

  21. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Priority Needs and Focus Priority needs and focus Generation Transmission Distribution End User Cleaner generation technologies Accessing high quality sources of renewable energy and addressing line congestion Accommodating increase use of EV, PV, DG, and consumer participation Improved efficiencies in buildings and industry Seamless connection: two-way power flows and increased data streams Integration of renewables: improved operation, planning, etc. Interface with end users: deployment of AMI, microgrids, etc. System understanding and control: visualization, communications, computation System flexibility for stability: storage, demand response, accommodating increased variability System security: physical security, cyber security, mitigating increased vulnerabilities There are institutional issues/solutions that must be considered in conjunction with these technology needs Source: DOE 2011

  22. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Priority needs: renewables integration What’s the challenge? • Variable renewables and their impacts on planning and operations • Impact of renewables on the distribution system • Delivery from resource locations to load (transmission) • Where are we today? • U.S. penetration less than 5% of total generation, and predominantly at transmission level • Some BAs with up to 10% capacity from variable sources; 50% at distribution • Some European countries already at much higher penetration levels • Need for coordination? • Regional transmission planning • New algorithms to support advanced modeling; dynamic analysis • Tool development (situational awareness, forecasting, storage) • Higher penetration integration studies • Market design analysis • Where are we going? • Increasing penetration rate of variable generation - 20%... 40%... 80%? • Seamlessly integrated DG, EVs, DR • Resource-focused planning Source: DOE 2011

  23. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Priority needs: smart grid What’s the challenge? • Implement two way communication to inform consumers and grid operators • Integrate PEVs, DER and DR while better managing load • Improve electric system efficiency and reliability • Where are we today? • Recovery Act funded SGIG, SGDP, and NIST Interoperability standards, creating large-scale demonstrations/deployments • Increasing penetration of intermittent renewables and DR into T&D, emerging PEVs with aggressive penetration targets • Need for coordination? • Coordination of multiple DER operations • R&D in power electronics, energy storage, smart PEV charging, and system integration • Multi-objective microgrid development • Hybrid AC/DC structure • Need to understand the consumer • Where are we going? • Distribution automation • Expanded integration of DER/DR/PEV • Cost-effective microgrid development • Integrated T&D modeling and analysis • NIST/IEEE standards implementation • Business case development Source: DOE 2011

  24. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Priority needs: Energy storage What’s the challenge? • Costs of energy storage systems • Cost/Benefit ratio too low • Lack of data for projects • Questions about reliability • Utilities are generally conservative • Regulatory treatment of energy storage • Where are we today? • Energy storage is utilized in the grid primarily for diurnal energy storage (primarily pumped hydroelectric plants) • 16 ARRA demonstration projects • New technology being developed – advanced batteries, flow batteries, flywheels • Need for coordination? • Building effective public–private partnerships to achieve RD&D goals • Complementary approaches needed to accelerate breakthroughs • Basic electrochemistry • Device development • Bench and field testing of systems • Where are we going? • Reduce grid storage costs 30% by 2015 • Develop multiple commercial technologies for multiple applications • Develop new materials and technologies to revolutionize energy storage • Develop value proposition for storage applications Source: DOE 2011

  25. DRIVERS OF GRID INNOVATION: GENERAL THOUGHTS AND OBSERVATIONS Priority needs: institutional and market reform What’s the challenge? • Existing markets, business models, and institutions need to evolve to meet needs raised by new and emerging technologies • Additional and ongoing coordination needed among government agencies and stakeholders at many geographic levels • Where are we today? • Increasing focus on collaborative regional and interconnection-wide planning • Improved coordination among Federal agencies for renewables development and transmission expansion • Need for coordination? • Federal and state agencies, NGOs need to participate in grid planning • Regional cooperation on resource development, market issues and transmission expansion • Grid operations will require even more intensive coordination in near-real-time • Where are we going? • Seamless, reliable, and efficient markets that allow for interstate transmission, access to distant generation resources, and also allow participation by DG, DR, storage, and other non-traditional technologies • Increased stakeholder outreach Source: DOE 2011

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