When the world’s first electricity grids were developed a century ago, energy was cheap and abundant, the term climate change hadn’t even been coined and grids were centralised systems, with electricity flowing from power plant to people’s homes in one direction.
Today, any one of those homes could have its own power on the roof in the form of solar panels feeding back into the grid, while climate change means there is an urgent need to make the most of the renewable energy those panels produce.
“The changes that are coming along, like electric vehicles, like renewable energy, really can’t be accommodated by the existing grids,” says John Scott, an independent energy consultant and a member of the SmartGridGB forum, which champions smart grid development in Britain. “So rather than making the grid bigger and bigger… smart technologies allow you to get much more out of what you already have.”
“Either we have to pay millions to reinforce our current grid to cope with the increased load, or we adopt smarter technology,” says Dr Luis Nando Ochoa, a senior lecturer in smart distribution networks at the University of Manchester. “By controlling things we can still use the same infrastructure but it’s now more intelligent and we can defer all this investment, which will be very expensive.”
Smart grids are about digitising the electricity network – with the flow of data as important as the flow of electricity. The grids depend on smart meters and other intelligent devices in homes and offices that keep power companies informed in real time of exactly how much energy is being produced and consumed and where. The grid technology then draws on this two-way flow of information to match up supply with demand. It’s this flow of information between producer and consumer that is the real game changer.
Enel developed the world’s first smart grid in Italy in the early 2000s, installing smart meters in every Italian household. Since then, fledgling smart grids and trials have proliferated. Enel is now digitising Spain, while smart grids already exist in parts of the USA, China and northern Europe.
According to information provider Bloomberg New Energy Finance, global smart grid investment grew to $14.9bn in 2013, with China the largest investor, spending $4.3bn compared to $3.6bn in the US. In Europe, over €3bn has been invested in around 450 smart grid projects since 2002, although the EU commissioner for climate action and energy, Miguel Arias Cañete, recently spoke of the need for a colossal €400bn investment by 2020 to modernise the continent’s electricity transmission and distribution grids.
These are huge costs – but the environmental payback is worthwhile. The Climate Group – a non-profit organisation that works with business and government to promote greener technologies and policies – estimates that, worldwide, smart grid technologies could prevent about 4% of worldwide emissions.
And the intelligence provided by smart grids is not just useful to power companies. Smart grids will be able to interact with domestic appliances, allowing consumers to opt to run washing machines or electric car chargers only using off-peak electricity, helping to reduce peak consumption and cut bills.
“Not everyone will choose to use lower tariffs, but if just 10% of a country does that will make a huge difference,” says Ochoa.
One big area where smart grids could change people’s daily lives is in transport, by allowing mass ownership of electric vehicles. “Electric vehicles are really disruptive to traditional power grids,” explains Scott. “If everyone in a street plugged in an electric vehicles, you’d blow the fuses in the local sub station.”
The way around this, he says, is smart charging. Sensors on the network will know when a vehicle is connected. You can then tell the grid when you need the car to recharged by and it will find the cheapest energy available during that period, rather than simply beginning the process straightaway.
On a global scale, while fossil fuels of course remain key to most electricity generation, smart grids will play an important role in helping to decarbonise the world economy, precisely because they can adapt so well to changes in the power from renewables caused by natural fluctuations of sun and wind.
“The development of new renewable resources means we need to change how electricity networks are used and designed,” says Livio Gallo, Enel’s head of global infrastructure and networks. “We need to move from passive to active, and smart grids can flexibly integrate and manage electricity flows that differ in quantity, quality and origin.”
Enel is now working on smart grid projects across Europe and is part of the four-year European project Grid4EU, which is trialling smart grids in various countries with a particular emphasis on energy efficiency and new uses of electricity.
The company is also behind Telemando, an ambitious programme to enable remote monitoring and control of the grid across Latin America, which will cost around $400m and involve 15 million customers. “The goals are very challenging,” says Gallo, “but on the basis of our experience in Italy and Romania, we expect that after full roll-out, we’ll achieve a 50% reduction in the average length of annual interruptions.”
While the technology behind smart grids may be the same, different countries have different objectives for them, says Ochoa. In Europe, efficiency is key and smart grids are a platform for low carbon technologies and decarbonising the economy.
In China, it’s more about having a strong grid that’s able to keep pace with the huge demands put on it, while in America and Japan, smart grids are about resilience and maintaining a supply of energy during extreme weather events and natural disasters.
In Latin America, their role in clamping down on energy theft is also a key driver.
These objectives and existing technology mean each country’s strategy for modernising its grid will be different. In many developing countries, for instance, there is a lack of key infrastructure such as distribution sensors and effective telecommunications, which can hold smart grids back.
However, says Gallo, the savings made by improved reliability, loss reduction and the hosting of additional distributed energy, means payback is very quick meaning the introduction of smart grids is often still viable.
Smart grids will also provide the basic foundation for smart cities, where urban areas will be greener, cleaner, better managed, and have a higher quality of life. Today, around 3.9 billion people live in cities but this is forecast to surge to as many as 6.3 billion by the middle of the century. Such an influx of people demands radical change to urban infrastructure.
In conurbations such as Barcelona, Turin, Búzios in Brazil, and the Chilean capital Santiago, Enel is putting the smart city concept into practice, bringing power generation closer to end users by installing photovoltaic panels on public buildings, and micro solar power generation in hotels, all linked up by smart grids.
The grids also open up new ways to control street lighting, traditionally a big drain on energy. They will allow lighting in cities to be managed more efficiently by adjusting brightness levels depending on, say, volume of traffic or footfall.
“The smart grid is the next logical step for electricity distribution,” says Gallo. “It epitomises the way in which we should be using technology to live more comfortably and more sustainably. It’s the smart thing to do.”
Content on this page is paid for and produced to a brief agreed with Enel, sponsor of the energy access hub at the Guardian Global Development Professionals Network.
