Introduction to Smart Grid.

This course will introduce you to the Smart Grid.

And in this course, we will answer the following key questions.
What is the Smart Grid?
What are its key drivers and dimensions?
What are some of the top utility executive concerns and
how we believe the Smart Grid will solve some of them.
And what are the major Smart Grid projects
and adoption trends around the world?
This course is divided into six segments.
The six segments are, one, current state of the electric industry.
Two, Smart Grid definitions, key characteristics, dimensions, drivers,
and benefits.
Number three, Smart Grid architecture and top utility executive concerns.
Number four, the Smart Grid cost-benefit analysis
and how it is adopted worldwide.
Number five, what are some of the major Smart Grid projects around the world?
And number six, what are the mega trends in the power industry?
Who are the key Smart Grid players, and what are their areas of focus?
In this segment, we will be discussing the current state
of the electric industry.
Let us start with the electric value chain.
It has six stages.
The first is the production and procurement of the commodity
that we call generation and trading.
The next is the generation substation where voltage
is increased to transmission levels.
The third is the long distance transportation of the commodity
that we call transmission.
Then we go to the distribution substation
where the voltage is decreased to distribution levels.
We again transport the commodity at lower levels of voltages
to the customer, which is called distribution.
And then the last stage is the consumption
where you deliver it to the customer, and they get
to consume the electricity as energy.
The entire value chain comes together in different forms
to create the power delivery system.
Let us now break down the electric value chain from an efficiency perspective.
When electricity is generated, let us say from coal, there is about 65%
in losses.
A further 4.8% of loss is incurred during the bulk transmission
process and another 5% in the distribution process,
resulting in a mere 30% or lesser that reaches the customer's premise.
That means that for every unit of energy that actually reaches the end user,
roughly four units of energy are input into the generation process,
and the remaining three are lost.
These figures are actually from a analysis
that was done by the Department of Energy in the United States.
Let us now bring all the pieces of the value chain
back into perspective from its age and extent perspective.
The current US grid is a century-old electromechanical infrastructure
with roughly 17,000 generating units of an average age of 50 years.
The bulk transmission system that spans about 164,000 miles
has transformers that are on the average about 42 years old.
This is interesting because their design life span is only about 40 years.
The distribution system spans about three million miles.
While this example focuses on the US electricity grid,
several other advanced countries face similar issues.
The current state of the industry can be summarized as follows.
In the energy balance equation, supply is currently the lever.
What does that mean?
It means that consumption follows its own pattern,
and supply follows consumption.
The key areas are we have an aging grid infrastructure
and security issues that come with it.
There is insufficient thermal generation and an inability
to integrate renewables at scale.
There are high T&D losses and an increased demand and a reduced
global competitiveness.
If you match this up with the centuries-old electromechanical grid
which has underutilized assets due to a reserve for peak demand
that is aging and retiring utility workforce,
and an inconsistent regulatory and legislative environment, all of these
result in a state that is not very sustainable.
So let us see what we can do about it.
Given its unsustainability, the industry is
moving towards a smarter grid whose characteristics include,
one, an increase in power transmission and transfer efficiency.
Two, optimized utilization of grid assets.
Three, intelligent end-to-end monitoring control supported by cybersecurity.
And number four, customer engagement and demand response.
Let us now recap what we learned in this segment.
The electric value chain consists of generation, transmission, distribution,
and the end-use customers.
We know that electric energy cannot be stored economically at good scale.
There are many inefficiencies along the traditional electric value chain.
Increasing electric demand, high transmission and distribution losses,
and an aging infrastructure are some of the key areas that are creating
the imperative for a smarter grid.