Smart Grid Will Revolutionize Energy Use and Distribution

By: Heather Moyer on August 25th, 2023

Today’s aging, degrading electrical grid is struggling to keep up with the increase in demand for energy, especially renewable energy. In the U.S., “demand for electricity is expected to grow 30% by 2030. Electricity prices are forecast to increase 50% over the next 7 years.”

The energy industry is in the midst of a digital transformation, and the grid must also evolve.

What Is Smart Grid?

Today’s power grid was birthed in the 1870s, Thomas Edison supervised the installation of the world’s first power plant. Smart grid is described by the International Energy Agency as “electricity network that use digital technologies, sensors and software to better match the supply and demand of electricity in real time while minimizing costs and maintaining the stability and reliability of the grid.” It modernizes power generation, transmission, and distribution in ways that more effectively support increasing and evolving energy needs.

Why Do We Need Smart Grid?

A key limitation of today’s electrical grid is how it generates electricity, which is based on estimations of demand. It’s vulnerable to fluctuations and imbalances in supply and demand and weather, potentially cascading outages and destabilizing nearby units.

In addition, approximately 80% of U.S. electricity is produced using conventional sources: natural gas, oil, coal, and nuclear, all of which are nonrenewable and create waste. “For example, natural gas releases carbon dioxide and nitrogen oxide. Earth’s atmosphere traps these gases, leading to air pollution and smog.”

Fast-growing renewable electricity sources, like wind and solar, are less centralized than in past generations, requiring energy storage.

Benefits of Smart Grid

Contain and Resolve Outages More Quickly

Increases in delayed detection and resolution of outages compromise public safety. “The second half of the 1990s saw 41% more outages […] than in the first half of the decade.”

By identifying and addressing outages quickly, smart grid minimizes the impact of outages, containing them and ensuring faster recovery after emergencies.

Improved Efficiency

Real-time data on energy consumption is sent to the utility via smart grid’s two-way communications, allowing for improved planning and faster response. The ability to store energy prepares the system for spikes and enables conservation.

“Advanced information, control and communication technologies are integrated in smart grid, which provides strength technical support to [demand response] projects.”

Data on peak times, problems in their systems, and other real-time data could lead to 30% reduction in consumption. “[Advanced metering infrastructure (AMI)] measures the quantity of energy used, analyzes how it is used by identifying the problems and reads the actual energy consumed by a consumer.”

Decreased Costs for All

Decentralizing electricity production “can significantly reduce transmission congestion costs, currently estimated at $4.8 billion annually.” And mitigating power disturbances could save upwards of $49 billion per year.

And more efficient utilization and increased use of renewable energy will ultimately drive down consumer costs. Smart meters reduce operation and management costs, adding to those savings. Consumers “will be able to manage their energy costs proactively, whether that means investing in intelligent, energy-saving end-use devices or selling energy back to the utility for revenue or as a means of exercising environmental stewardship.”

A Greener Future

At minimum, smart grid reduce the need for power plants and transmission lines to support peak hours. But it advances our ability to replace traditional sources of energy with renewable sources in addition to reducing waste. Integrating and decentralizing wind and solar power more effectively also requires more advanced energy management techniques.

Increased use of hybrid and electric vehicles (EVs) has exponentially increased the burden on today’s grid. “Smart chargers, time-of-use rates, and advanced meters will be key players, helping to manage a very complex control problem on already constrained grids,” in turn incentivizing EV purchases by consumers and production by manufacturers.

The Future of Smart Grid Technology

Just as Edison’s light bulb became a standard in homes everywhere, smart grid will mean continued growth of renewable energy sources (eg, solar, wind), distributed energy resources (DERs), and use of electric vehicles. It will also mean advances in analytics and data management to support monitoring and managing the grid, including cybersecurity and detection of issues.

“By 2024, investment on smart grid devices or systems, such as advanced metering infrastructure, was forecasted to reach some 6.4 billion U.S. dollars.” Growth at a global level is expected to continue to grow at a rapid pace as well, reaching $108.92 billion by 2030. ROI will be realized through improved efficiency and reduced outages. “Cost savings from smart grid deployments will exceed $125 billion globally in 2027; increasing from just over $33 billion in 2022.”

Powered by Internet of Things (IoT) technology, consumers, distributors, and suppliers may benefit from increased stability and security from blockchain-based energy trading, leading also to an increased need for regulations and legal expertise. Smart grid is a critical step toward smart cities.

HNM Systems Can Staff Your Utility & Network Construction Projects

When discussing utility staffing, Deloitte reports, “Advances in smart grid, distributed generation, microgrids, and energy storage are revolutionizing the energy business, which necessitates a new talent profile. With a rapidly aging workforce, it will be critical that utilities can identify the right talent pool and adequately recruit, hire, retain, and develop them.”

HNM’s extensive network and custom-tailored approach can help you staff for utility construction and network construction projects, like smart grid infrastructure, among others. With more than 40+ years of experience and expertise, HNM is uniquely equipped to keep your business moving forward and delivering high-quality results.