November 10, 2009

EXCLUSIVE INTERVIEW:

Smart grid luminary lists

ones he likes, tells why

During the Q&A at the White House press briefing the night before the SGIG awards were announced, we cited concerns raised by smart grid industry dignitary Kurt Yeager -- and last week we called him to find out whether his fears were being realized in the 100 projects that won grant awards.  Yeager shared with us in September his concern that DOE might pick “shovel ready” projects that would ultimately not help move smart grid industry development forward (SGT, Sep-21).

          At the White House briefing, Matt Rogers, senior adviser to the secretary at DOE, responded to our question about Yeager's concerns with assurances that the quality and quantity of applications should allay fears that the projects chosen would miss the mark in helping the smart grid grow (SGT, Oct-27).

          Well, did they miss the mark?

          Fewer than 20 of the 100 projects winning SGIG awards may do enough for the consumer and the community to impress Yeager, the Galvin Electricity Initiative executive director and former long-time EPRI chief told us late last week.  Many of the winning applicants' projects amount to just buying a bunch of smart meters, he added.

          The bulk of the SGIG awards represent “more of the same,” he said, “and I don't know that, as a taxpayer, I am very pleased to see my money being spent that way.  It may improve the utility operations to some degree but it's not going to create the benefits we need from the smart grid” to help power consumers see “tangible benefits,” said Yeager.

          “That's been a lot of the history of so-called progress in this industry,” he added.  “It's been done in a manner that [says], ‘Let's just keep things just like they are.'”  What will cause change to happen? Consumers will probably only be interested in taking part in energy management when electricity prices rise, Yeager predicted.  “If you have this much metering infrastructure in there, at least you've eliminated a basic barrier.  This [ARRA] money strategically may help make a difference when the economy starts to come back.”

          Yeager outlined for us the SGIG projects that, from his current knowledge of them, “have some real potential to demonstrate the consumer value of a smart grid.” Neither Yeager nor the Galvin Electricity Initiative has a financial relationship with firms and municipals mentioned in this article, Yeager assured us.  Here's his picks broken into groups by DOE-chosen category:

        AMI

• Cheyenne Light, Fuel and Power, in Wyoming, $10.1 million grant.  “They're putting in not just [38,000] smart meters and the pricing but also the infrastructure,” Yeager said.  “Most of that is internet infrastructure, so it's not like you're stringing a lot of wires but it's the capabilities for consumers to automatically be sure the devices in their homes are taking full advantage of pricing -- and they are in control of that destiny.”

• Connecticut Municipal Electric Energy Cooperative in Norwich, $9.2 million grant.  The firm plans to build a regional smart meter network infrastructure including five municipal utilities and at least 13,000 meters to let customers control their power use through time-varying rates and control, communications and management systems, according to the White House.

• Westerville, Ohio, $10.7 million grant.  The city plans to convert 13,000 power and water meters to a smart grid network.  “Some of these are fairly small but in many cases they may actually produce a lot more benefits than the larger ones,” Yeager said.  “The real key is, are they providing TOU pricing data and are they incorporating consumer-friendly [technology] to utilize those prices?”

          Customer Systems

• Honeywell International, Danvers, Mass, $11.4 million grant.  “I am quite impressed with what they are trying to do,” Yeager said.  “They have the technology, immediate market access and credibility to make a very big difference.  It's very important here that a Honeywell be a leader here and not a follower.” Honeywell is set to provide automated peak pricing response for about 700 C&I customers, a White House document said, adding, “Fully automated demand response will reduce the electricity load during times of peak demand.” We reported on Honeywell last week (SGT, Nov-04).

          Distribution Systems

• El Paso Electric in Texas, $1 million grant.  “It's a fairly small project but at least it has the scope and capability to increase the system there.  The White House description of El Paso's project says it will install DA to increase the monitoring and control of the distribution system and improve power restoration during emergencies.  But that notation doesn't do the project justice,” said Yeager.  “It is incorporating the automation capabilities into the consumer [side].  It's focusing on breaking down the supply-demand iron curtain, if you will.”

• PPL Electric Utilities in Allentown, Pa, $19.1 million grant.  “It probably offers the most potential [in this category of SGIG grants] because they are providing not only the meters and the real-time pricing but also the infrastructure for distributed generation,” Yeager noted.  “If a utility is seamlessly connecting supply and demand, we can have an electronic iron curtain instead of a mechanical one,” said Yeager.  As DG becomes more competitive and broadly available, “it becomes an integral part of the mix” and can “minimize the need to build new centralized generation” to deal with peak-demand requirements.  “Most utility projects are not intending to do that.  This is one that is looking comprehensively at that capability.  It remains to be seen what they do with it but at least they are opening that door.”

          We reported on the PPL project last week (SGT, Nov-02).

          TO BE CONTINUED: Our reporting on Yeager's top SGIG picks continues in Thursday's issue.