Sandy and the Smart Grid, Who Won?
A hurricane inspires industry discussion; by Phil Carson
Published In: Intelligent Utility January/February 2013
AS HURRICANE SANDY MADE LANDFALL along the New Jersey shore at 8 p.m. on Monday, Oct. 29, its storm surge and 80 mph winds submerged power substations and underground power lines, knocked down trees, flattened homes, ignited fires and spread chaos. Communication systems and transportation were severely compromised, if not stopped.
Utilities in the storm's path had taken traditional pre¬cautions, arranging for field crews from outside the region, shutting down parts of the grid as the storm hit to avoid worse damage and monitoring damage as it occurred to in¬form a restoration strategy.
One potential bright spot: Along with its destruction, Hurricane Sandy brought renewed attention to the critical nature of electricity in a digital economy and the challenges of infrastructure hardening and resilience for the 21st cen¬tury. And the grid had company: the devastation included infrastructure for water and natural gas systems, transporta¬tion and communication.
The upshot for power
Long before storm waters receded or utilities filed their ma¬jor incident reports to regulators, storm-inspired discus¬sions turned to the role of the smart grid in the event. Did smart grid systems assist before, during or after the storm? Anecdotes abound but solid answers will take time. (This article went to press a mere 30 days after the storm struck, as restoration work continued.)
Scrutiny of smart grid functionality and costs is likely to increase, just when greater long-term investments are urged by power sector players. Jeff Lewis, who heads the global en¬ergy consulting practice at PA Consulting Group, which is tracking utility performance during Sandy, tried to put the matter into perspective.
"Damage to physical assets was severe," Lewis said. "Obviously if a bunch of trees come down, the effectiveness of schemes of smart technology such as sectionalizing and automated restoration is quite limited."
Smart grid, so far
"Such risks are going to persist and we'll see more and more extreme events, more variability will hit our systems and infrastructure," said Massoud Amin, an IEEE senior mem¬ber and a professor of electrical and computer engineer¬ing at the University of Minnesota, where he also serves as director of the Technological Leadership Institute. "This brings a wider range of uncertainty to future events. This is both a local challenge and a regional and national opportu¬nity to upgrade and harden the system."
Now, to "the system." Advanced metering infrastructure (AMI) and distribution automation (DA) remain the most widely deployed smart grid technologies, along with geo¬graphic information systems (GIS) and outage management systems (OMS). All four technologies have been touted to regulators and customers as contributing to outage detec¬tion and self-healing, as well as customer notification of es¬timated time to restoration (ETR). But these systems present integration challenges. And, currently, fully integrated smart grid systems are a rarity.
According to Arshad Mansoor, a senior executive with the Electric Power Research Institute (EPRI), full integration of these systems-with data analytics running on top-is a multi-year, multi-hundred-million-dollar proposition for any large utility.
"It's not just system integration but you need business analytics running on top of all this," Mansoor said. "Those analytics do the `circuit chasing' for you."
("Circuit chasing" is the act of assembling known end-user outages into a pattern that indicates a malfunctioning asset upstream, a process once-and still-initiated by cus¬tomer phone calls.)
According to Mansoor, well-integrated systems with ana¬lytics can identify the critical juncture where field crews need to go and, he noted, the accuracy of field crew dispatch has a major effect on restoration time.
The last integration piece, Mansoor's "holy grail," is a work management system that would automate accurate field crew dispatch fol¬lowing the analytics work.
"Fuller integration is where we're headed," Lewis agreed.
Work has just begun
"Will regulators allow the right levels of expenditure for integration and ana¬lytics?" Mansoor asked rhetorically.
"They cost much more than meters do. That's a difficult sale. But we've got to do it. To us, the value of smart grid becomes fully realized when this level of integration, with the right analytics, is baked into a system."
"How you handle data is a huge undertaking," Mansoor said. "In the past century we had to run the distribution sys¬tem blind, and now we are blinded by data. I'd say we're only at the early stages. We've only just installed our sensors."
Hardening and resiliency
"At EPRI we see a three-pronged approach to resiliency," Mansoor continued. "First is hardening-undergrounding, vegetation management, substation vault design. Second is recovery-identifying the location of damage, isolating the damaged portion and restoring it. The third prong is surviv¬ability, which is the least-resourced area. We must assume that infrastructure can never be technically or cost-effective¬ly feasible to withstand everything that Mother Nature or a human act can throw at it. We must plan for failures."
Amin also divides his thoughts between hardening and resilience, and the link between the two.
"Do we need a stronger, hardened grid, or do we need a smarter and more resilient grid?" Amin asked. "Actually, we need both. At some level you need to strengthen and even maybe reconfigure the grid itself. You need to strengthen and increase intelligence."
"We can do better in terms of physical protection to strengthen the physical infrastructure of distribution and transmission systems," Amin continued. "You don't harden the entire system; you judiciously harden parts of it based on risk, and the cost drops. We need a framework for our nation to advance progress, but it boils down to local issues and the best local solution based on risk and cost-benefit analyses."
On the resilience side, Amin suggested that the specific technologies are less important than three basic functionalities:
- Real-time monitoring and decision-making to tune the grid to an optimal state.
- Monitoring for precursor conditions to guide grid operations prior to a high-impact event.
- Rapid isolation of faults.
"We cannot build a zero failure system, it's too expensive," Amin concluded. "But we can localize the disturbance and lower its impact."
The value proposition, moving forward
According to Amin, current outages cost the economy somewhere between $80 billion to $188 billion each year. A smarter, stronger grid would reduce the low-end esti¬mate of $80 billion a year by $49 billion, in his estimates. A smarter grid would increase the system's efficiency by about 4.5 percent. That's worth another $20.4 billion, he said. Together, improving just those two aspects-reducing outages, improving efficiency-brings about $70 billion in benefits. A smarter grid would also reduce CO2 emissions by 12 to 18 percent.
Amin's cost estimates range somewhere between $338 billion and $476 billion for a smarter grid, and about $82 billion for a stronger grid. When those dizzying numbers are recast as a 20-year project, that's a cost of $25 billion to $30 billion a year for 20 years. (Hurricane Sandy's impact led New York alone to re¬quest $42 billion in federal aid, and in December 2012, economists were crediting the storm with significant¬ly slowing the national economy.)
"Don't forget, this investment means job creation," Amin added. "And it's cheaper to pay for now than down the road. Interest rates are at an all-time low. Investment in a stronger, smarter grid means that for every dollar we spend, it's going to have an economic return of $2.80 to $6 per dollar that goes into smart grid. To reach these numbers we used a very narrow definition of `smart grid.' If you widen that definition, the benefits would increase. Conservatively, for every dollar spent on smart grid, including localized upgrades, the benefit would be about 3 to 6 times return on investment in terms of jobs and economic output."
"A lot more needs to be done for the benefit of smart grids to kick in," Amin concluded.
Smarter practices, including customers
Smart grids are only a piece of the puzzle to greater resiliency Amin and Mansoor both suggested. Other utility practices, such as using small, camera-equipped drones and mobile imaging technology to assess and pinpoint damage should be added to the tool kit, they suggested.
Better-prepared, more self-sufficient homes, business¬es and communities should take steps to weather events.
Microgrids, solar arrays that can island when the grid is down, hand-cranked radios and cell phones can provide emergency communications.
"Sandy heightens the opportunity for innovation," Mansoor said. "The changes on the customer side? How many of us had iPhones and tablets five years ago? Today, 30 percent of utility customers don't have landlines. Sandy ex¬posed the tremendous opportunity we have to partner with consumers to speed up the restoration process. We'll have to educate our customers."
Hurdles to forward progress
Lewis, whose clients include utilities, is concerned that fault-finding may trump progress.
"I think there's merit in looking at [utility responses]," Lewis said. "The utilities didn't do everything right, by any means. I just fear that with the number of investigative agen¬cies and lawsuits involved, it's really going to distract utility managers from their day job."
Amin called attention to the pro¬cess under which change must occur.
"One important constraint is the regulatory oversight of grid modern¬ization," Amin said. "Jurisdiction over the grid is split: the bulk electric sys¬tem is under federal regulation, but the distribution grid is under state-level public utility commissions. And those local regulations essentially kill the motivation for any utility or util¬ity group to lead a regional or nationwide effort. So we need a policy framework to provide incentives for a collaboration in grid modernization and for research and development."
The bigger picture
The 20th-century grid exceeded our expectations for basic services, rural electrification and economic development, Amin said. But the power grid, like water, transportation and communication, are in need of serious investment to maintain national competitiveness, let alone resiliency in a major storm.
"We have not advanced our infrastructure sufficiently," Amin said. "The World Economic Forum's recent competi¬tiveness report ranked our U.S. infrastructure below 20th in most of the nine categories of infrastructure, and below 30 for quality of air transport and electricity. We wouldn't have settled for something like that in the 1950s or 1960s."