Friday, January 29, 2016

After the Smart Grid, What’s Next?

For years now, energy providers throughout the country have been working diligently to modernize the backbone of American infrastructure; the grid. When you take a step back and look at smart energy advancements we’ve already made, they’re pretty astonishing. If 15 years ago you had told consumers that their utility company would be able to remotely adjust their water heater or air conditioner to reduce demand on the grid, or allow them to view their real time energy usage from something called a “smart phone,” bewilderment is not the only look you probably would have received.

Today, more than 51 million electromechanical meters have been replaced with new smart meters, our appliances connect to our Wi-Fi networks, and solar charging batteries large enough to power our homes are starting to become a reality.

We’ve come this far, but where are we going next? SGCC set out to answer this question on our most recent webinar, After the Smart Grid, What’s Next? Leveraging expertise from across the smart grid industry, Rob Stewart, Manager of Advanced Technology & New Business at Pepco Holdings, and Eva Buren, Managing Director at Accenture Energy Consumer Services, presented us with a vision of what might be next for the smart grid.

Explaining how Pepco’s grid infrastructure has matured, Rob outlined Pepco’s “5 Evolutionary Steps to Achieving the Smart Grid.” Having completed Steps 1-3, which primarily focused on the installation of intelligent devices and a communications infrastructure, Rob explained that steps 4-5 will now focus on the development of data analysis capabilities and decision making based on near real-time information. As Pepco enters step 4, Rob explained that they are “working to turn data into knowledge, and then turn that knowledge into insight” that can be used to inform decisions, and stay one step ahead. Reaching step 5 Rob said “would be nirvana, total optimization.”

While Pepco is already helping consumer save money on their electric bills through a targeted demand response program that includes dynamic pricing options and more than 350,000 automated switches on thermostats and air conditioning units, Pepco is now preparing for the next generation of consumers. Rob explained that Pepco already has more than 20,000 net energy metered customers, representing 320 MW of residential solar, and expects that number to continue to increase each month as prices for distributed generation continue to fall. Additionally, Rob explained that a more intelligent grid is allowing for better interactions with customers. Pepco is currently testing new In Home Displays that allow customers to monitor energy usage in real time, dynamic pricing, and to receive more accurate notifications in the event of an outage.

Additionally, with electric vehicle (EV) sales increasing year after year, Pepco is developing a demand response program to reduce impacts on peak demand by introducing both passive and active controls for EV charging. Currently designed as a pilot program for residents in Maryland, Rob explained that customers are presented with various rate plans and charging options that fit with their lifestyle. When a house is equipped with a second smart meter and smart charger, Rob explained that Pepco can reduce demand by controlling the level of charge being delivered to the EV. Or, if a customer selects to be on a time of use plan, they know that charging their vehicles during hours of peak demand will have an impact on their bill, and ultimately end up changing their behaviors. Early results have shown that customers are taking advantage of these smart grid enabled rate plans and charging options, benefiting both the grid, and their electric bills.

As part of a cohort of technology companies, power providers, and national labs, Rob provided an overview of how Pepco is working to more efficiently integrate distributed sources of generation onto the grid through the use of Smart Inverters. These Smart Inverters communicate through Pepco’s Advanced Metering Infrastructure (AMI) network to a central database in an effort to determine when and where resources such as solar can be brought onto the grid. In a similar vein, Pepco is also using their AMI to help local municipalities take better control of their energy usage by offering controls for “smart streetlights” and other grid connected devices.

Knowing that customer adoption and participation are key drivers behind the continued success of the smart grid, Rob explained “that there is no longer a single “best solution,” but there are in fact but iterations of better solutions that will continually be developed.”

While Rob highlighted some of the current research and development that is taking place to get us to “Grid 3.0,” Eva Buren, Managing Director at Accenture Energy Consumer Services, provided us with a tantalizing account of what consumers expect out of the next iteration of the smart grid.

Knowing that the grid “is a critical enabler in the rapidly evolving realm of customer wants, needs, and expectations,” Eva explained that Accenture Energy Consumer Services has surveyed more than 60,000 consumers across 26 countries to figure out what they want from the evolving smart grid. With an emphasis on satisfaction, Eva explained that Accenture has identified three key themes that define tomorrow’s “New Energy Consumer.”

Unlocking Digital Value: Eva explained that “tremendous value is associated with digitally engaged consumers versus the ones that are interacting with their utilities in a more traditional way.” According to Accenture’s research, digitally engaged consumers are more satisfied with their energy provider, are more like to recommend their energy provider, are more likely to participate in energy management programs, sign up for automated home energy management devices, purchase home energy generation system, and exhibit more trust in their energy provider.

Extending the Value Proposition: “Even if you “build it,” they will not necessarily come,” said Eva. Extrapolating on that statement, Eva explained that just because energy providers are building new digital tools doesn’t mean that consumers are automatically going to start using them, there needs to be a value to them to migrate from traditional channels. Through the smart grid energy providers are afforded an opportunity to expand on their traditional value to the consumer, and forge new relationships by expanding their offerings across home generation, battery storage, and connected home systems.

Seizing the Digital Energy Revolution: Consumers are seeking a single source for interconnected home services offerings that address more aspects of their daily lives. Eva explained that by 2020, Accenture expects 64% of consumers to be seeking bundles of new products and services with electricity, gas and/or water from their energy provider.

Advocating a staged approach, Eva explained that the consumer-centric smart grid of the future must be built upon value focused offerings that drive customer experiences, encouraging them take the next step and become digitally engaged with their energy provider.

If you we’re unable to attend this webinar and would like to learn more about what’s next for the smart grid, I encourage you to watch the recording and hear how Rob and Eva responded to some great questions from across the industry.

Knowing that nothing happens overnight, the Smart Grid Consumer Collaborative believes that an educated, informed, and empowered customer base will assist our nation’s energy providers in pushing the boundaries of the smart grid further than ever before. I would like to invite all of my industry colleagues to attend our Annual Consumer Symposium: The Connected Consumer & the Future of the Grid on February 8th, co-located with the DistribuTECH 2016 Conference in Orlando, FL.

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