1. Portland State University Smart Grid Class Enabling active consumer participation 20 April 2009 Presentation: History Politics Economics Technology

2. Transmission Substation Distribution Ultimate Customers of Electricity History – last 100 years +

3. History – 1999 concept, with updates

4. Politics: Is implementation Smart Grid an issue of technology, regulation or economics? (Is it human nature to change before there is a crisis?) Utilities want open standards and commodity products Manufacturers want proprietary technology and custom products Do standards drive open or proprietary systems? How are costs externalized in each of these situations?

5. Economics: Issues to consider Most economics problems are about capacity issues: telecom - bandwidth, highways - lanes, and power - system peak, which governments regulate and consumers pay for The Smart Grid is about reducing utility and consumer costs, in the context of who pays and who benefits? Should Legacy systems be integrated into the Smart Grid? Two options to pay for the Smart Grid are: –Rate recovery by utilities –Incentives for end-users –Or a combination of both

6. Technology options: Generation: issues are around carbon, location and safety - this is outside the scope of this discussion (still need future base load) Utilities want power sources that are inexpensive, can be turned on and off quickly, and be sited near load centers Transmission: self-healing grid, renewables integration, volt and var support Phasor measurement units (PMU) helps system wide stability, but need something to control (load or generator) Distribution: micro grid for reliability, conservation voltage reduction, energy storage at substations, control of backup generation End use: energy efficiency, demand response, energy storage All these levels should talk to each other, dispatchers and traders for market efficiency and transparency

7. Smart grid should: Enable active participation by consumers Accommodate all generation and storage options Enable new products, services, and markets Provide power quality for the range of needs in a digital economy Optimize asset utilization and operating efficiency Anticipate and responds to system disturbances in a self-healing manner Operate resiliently against physical and cyber attack and natural disasters"

8. Technology Cyber security and Big Brother issues ATM's and wireless VISA machines currently perform millions of transactions per day across the Internet, does it make sense to have a more secure system on your electric meter? Bringing down the grid would most likely be done from central control systems, not end use points Appliance manufacturers want messages sent to Smart appliances and want the appliance to decide what to do Utilities want to control appliances directly which leads to Big Brother concerns by end-users End-users want convenience, which equates to automation of response to utility signals in my opinion and potentially reduces the Big Brother issue

9. Can consumers be counted upon to participate in supporting the grid? National grid - UK example: matrix of customers versus time of day, week, month, year for ancillary services has been successful. Based on contracts ability to call on loads as Resource when needed. Yes it takes customer service work versus building new peaking plants.

10. Small site Energy Management Two Way Broadband, Browser based option To please consumers and utilities a system requires: –Consumer friendly, easy to use interface via web browser (energy version of iPod) –Control heating ventilating and cooling (HVAC) systems as well as hot water heaters, homes and lighting via programmable communicating thermostats and load control modules –Allow users to choose between maximum comfort and minimum cost on a sliding scale –Be able to document energy efficiency savings –Provide real-time metering and sub metering data, from the utility meter or sub metering equipment –Provide HVAC continuous commissioning and diagnostics –Be easy to install by an HVAC technician and be self provisioning

11. Small site Energy Management Two Way Broadband, Browser based option To please consumers and utilities a system requires: –Have automated the firmware and software updates over the Internet –Display carbon impacts, energy use, cost savings, utility rate plan options can do so via a PC or in home display (IHD) –Provide a payback of 36-60 months under utility rate recovery –Easily add and control new Smart appliances –Integrate with charging systems for plug-in hybrids or electric vehicles, for control –Respond to under and over, frequency and voltage events, with utility control of set points for voltage and frequency –Monitor power quality and end-use –Provide ongoing building performance information, such as R factor building energy response to weather conditions

12. Small site Energy Management Two Way Broadband, Browser based option Nice to have: –Read early generation automated metering systems and send back data via broadband to utility –Optional two-way broadband connection via a cellular or WiMAX for locations without broadband –Pass utility messages to Smart appliances –Control solar inverters for power firming –Ability to turn on loads when system overvoltage or frequency events occur (hot water heaters, electric vehicle's or refrigeration for example) –Multitenant option using only an in home display and remote programming via any web browser, thus eliminating the need for a PC

13. Take Away Question Should Smart Grid development be large scale and centralized or small-scale distributed, to enable consumer participation? Mike Hoffman mike@cell2biz.com 503 260-4397