Smart grids gain traction worldwide

Advances in smart-grid utility networks are taking place steadily, with announcements in the United States, China and Europe this month. Notably, Duke Energy Corp. (DUK) said it would support using cellular networks for its smart-grid backbone; Alcatel-Lucent (ALU) is working with a Chinese utility company to use technology to better manage energy; and a research firm estimated a $9.8 billion annual investment in smart grids in Europe by 2016.
Duke, which provides electric power across the Southeast and Midwest, released a white paper outlining its decision to use a variety of technologies to implement its smart-grid vision, including cellular, local area networks and node-to-node communications. The decision to use public cellular networks is a break from the Utilities Telecom Council, which believes utilities would be better served by private internal networks.
“A key philosophy behind the communications solution is that no single technology is capable of meeting the needs of or providing the coverage necessary for Duke Energy’s service territory,” said David Masters, manager of technology development at Duke. “Use of a public wireless carrier within the utility is not new. Meters at some of our largest customers, capacitor banks and other devices currently utilize public wireless carriers. Utilities in other countries are currently utilizing public wireless carriers for their entire metering infrastructure. The technological advances stemming from investments to serve the retail voice and data customers directly benefit the utility and its customers.” Masters also noted that Duke has no desire to be in the communications business.
Masters proposes using 3G technology to connect to the cellular network, rather than 2G technology, which is cheaper. While he does not mention which carrier Duke worked with, he does note that a nationwide carrier would be preferred. “While all areas today are not covered by a single carrier, utilizing multiple carriers and the possibilities of micro-cells, satellite and repeater technologies will ensure that Duke Energy’s service territory is covered.” Further, Duke said it worked with its carrier partner to better understand each other’s needs and develop a pricing model. Security issues can be addressed by having traffic routed through private IP networks, he said.
For its part, the UTC filed comments earlier this summer with the Federal Communications Commission that question whether wireless operators can properly address backup power, network congestion, coverage and service level agreements. The UTC would prefer the FCC set aside spectrum for the utilities’communications needs.
Interestingly, Duke’s model does not rely on embedding communications into smart-metering devices, but rather node-to-node communications. “After evaluating systems deployed by other utilities and industries, we determined that the solutions currently being offered would not fulfill our key drivers or meet our requirements. Most proposed systems are based primarily on an automated metering solution that leverages proprietary radio technologies or protocols, limiting bandwidth and the capability to fulfill the vision for 2-way digital communications beyond metering.”
Instead, the company said it would prefer to use node-to-node communications to carry the data to a data center. The node will have access to both internal and external Ethernet, serial and USB interfaces that can be used to connect to devices or modems. A-Lu in China
Meanwhile, Acatel-Lucent is working with China’s State Grid Information& Telecommunications (SGIT) Co. Ltd. on a smart-grid network. SGIT is a subsidiary of State Grid Corporation of China, which is one of the largest utility companies in the world.
Alcatel-Lucent said the two companies are working to “address some of the biggest challenges related to smart grids – accessing data used to track energy usage from the plethora of devices including smart meters, analysing that data and delivering that information to the utility.” No financial information or contract information was announced.
Research forecast
GTM Research noted that nearly $10 billion will be spent per year investing in the smart grid in Europe by 2016, with most of the investments centered on advanced metering infrastructure, distribution automation and electric vehicle charging stations.