According to the National Academy of Engineering, networked power grids and electrification was the top engineering achievement of the 20th century. This is a top-20 list that also includes innovations like automobiles and airplanes, telephones and computers, and the Internet. However, the power grid of the 20th century isn’t good enough for the 21st century—a century that will be remembered as giving rise to the Internet of Things. In this century, we need a more modern grid—a “smart” grid, so to speak.
There are many reasons why it’s important for this column to address smart grid, energy, and utilities. But more specifically, the need to examine some of the various opportunities presented by a smarter grid and the driving factors behind the projected growth of smart-grid technologies.
According to Persistence Market Research, the global smart-grid sensors market is worth about $174 million in 2017. However, by 2025, the research firm predicts the market could reach $1.45 billion. That’s a compound annual growth rate of more than 30% between now and then.
Governments and utilities all around the world are actively replacing conventional power grids with smart grids as the benefits become clearer and use cases and success stories begin to pile up.
One of the opportunities that’s driving adoption and future growth is a smart grid’s ability to monitor power operations and detect issues like outages.
We talk a lot about the benefits of realtime data here on The Peggy Smedley Show and in Connected World magazine, and you can make the case for how important data is for operations in any number of vertical markets. But, if I’m being honest, energy and utilities have to be one of the most important ways realtime data is being used today.
Avoidable outages can bring life and business to a screeching halt, often costing not only the utilities themselves but also their customers a lot of time and money in the process. A smart grid can help prevent issues before they occur through predictive maintenance, making avoidable outages, well, avoidable.
If issues can’t be prevented, they can be pinpointed immediately and taken care of as soon as possible. Gone are the days of waiting for people to call in and report outages.
The U.S. DOE (Dept. of Energy) says the smart grid will dramatically reduce the costs associated with power disturbances. When IoT technologies that enable communications and control technologies are applied to the grid, they can isolate faults and jumpstart the process that will result in service restoration.
Furthermore, the smart grid will be able to respond dynamically to evolving situations. The DOE says smart grid decision-support systems “know” when there is a need to quickly reduce load, and these systems can respond autonomously to adverse conditions.
The smart grid will also be able to “call for help.” By recognizing when it needs help, a smart grid can take steps to balance system needs by getting support from distributed energy resources.
So, not only will a smart grid be more efficient and reliable, but it will also offer increased operational flexibility, which can reduce the risk of a failure that could affect the entire grid. This flexibility will likely become even more important in years to come.
Why? The DOE also predicts that here in the U.S., the demand for electricity will grow 30% by 2030. What’s more, electricity prices are forecast to increase dramatically as demand grows. There is an opportunity here too for smart grid to play a role.
Smart-grid applications like smart meters give businesses and consumers more transparency into their energy usage, which can help minimize demand and, theoretically, take some pressure off of the future grid.
From a consumer’s and business’ standpoint, a smart grid and its enabling technologies like smart meters will also help keep costs under control.
This will be especially important if energy prices rise as the DOE expects them to. The smart grid will also offer the ability to better respond to any extreme weather events that may or may not result from climate change.
A more efficient, reliable, and manageable grid will certainly go a long way in keeping society up and running during future severe weather events, such as hurricanes and snow storms.
Another opportunity the smart grid offers, especially in developing nations, is the ability to curtail electricity theft. Persistence Market Research says in Latin-American countries in particular, power authorities are leveraging connected sensors to monitor electricity theft and other malpractices by identifying “faux power glitches.”
There are a few factors that are driving the space forward. One, of course, is the proliferation of the IoT in general.
In North America, research and development investments are also pushing the market forward as the technology becomes more advanced. There will also be future demands on the grid that will require it to be smart, which can encourage proactive thinking and smart grid adoption among utilities.
Some of these demands we can predict, such as an increase in vehicles powered by electricity. Others we can’t predict, but we should expect that the future will be just as innovation-filled as the past has been.
And considering the technological innovations last century gave humankind, some of which I mentioned earlier in this column, I’d say the bar for this century is set pretty high. It seems the case for grid modernization is clear.
In the short term, the smart grid offers key operational benefits for utilities, such as outage management, improved processes and asset management, workforce efficiency, and reduced losses.
In the longer term, a smarter grid can—and will—help society reach new heights in the 21st century. So the new grid needs to be modern and smarter than ever thought possible. And only time will tell how successful the modern smart grid will truly be in living up to all its potential in protecting our critical infrastructure.
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