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Delivering Benefits With A Smarter Grid September 2011


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A look at the next wave of smart grid and how AMI, distribution automation and synchrophasor technology will support functionality and benefits

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Delivering Benefits With A Smarter Grid September 2011

  1. 1. ENERGYDelivering BenefitsDelivering Benefitswith a Smarter GridNavigant Reference: 850179©2011 Navigant Consulting, Inc. N i tC lti ID I S P U T E S & I N V E S T I G AT I O N S • E C O N O M I C S • F I N A N C I A L A D V I S O RY • M A N A G E M E N T C O N S U LT I N G
  2. 2. Navigant Smart Grid Service OfferingsNavigant works with clients to develop Smart Grid strategies and implement Smart Grid programsimplement Smart Grid programs. Service Offerings Service Offerings Competencies SMART GRID STRATEGY Visioning Process and Strategic Objective  Development Total Value Assessment and Dynamic Rates  Analysis A aly i Vision &  Business  Strategy Case Strategic Option and Planning Development Business Analysis  and Business Case  Development e e op e t SMART GRID IMPLEMENTATION ARRA Reporting and Compliance PMO/ Construction Management / EVM Implementation  Smart Grid  Monitoring &  Customer Interface and Change Management Planning Implementation Evaluation Smart Grid and Distribution Technology IT / Systems Integration / Cyber Security IT / Systems Integration / Cyber Security©2011 Navigant Consulting, Inc. 1 ENERGY
  3. 3. Smart Grid Deployment WavesWe are entering the “Second Wave” of smart grid deployments where deeper understanding of the business case will become critical.d d t di f th b i ill b iti l Future Waves “Addressing Strategic Needs” Second Wave Se o d Wa e “Understanding the  stment  Business Case” • Targeted Targeted  Rate of Inves deployment First Wave “Laying the Foundation  • Scaling up deployment • Gradual build‐out and Learning” • More rigorous business  • Continuous Cumulative R cases improvement • Cost recovery • Demonstrating valueC • Pilot programs and demos Pilot programs and demos • Government incentives and  subsidies • Regulatory mandates 2005 2015 2020©2011 Navigant Consulting, Inc. 2 ENERGY
  4. 4. Smart Metering and Advanced Metering InfrastructureSmart metering and Advanced Metering Infrastructure will allow utilities and their customers to manage electricity consumption.utilities and their customers to manage electricity consumption Functionality • Real‐time load measurement  and management by utilities • Optimization of electricity  p y usage by customers Benefits • Peak demand reduction • Lower meter reading and  Sources: Elster, Navigant operations cost operations cost • Faster restoration of power after  outages©2011 Navigant Consulting, Inc. 3 ENERGY
  5. 5. Distribution AutomationDistribution automation technologies are being implemented improve reliability, increase operational efficiency, and save energy. reliability increase operational efficiency and save energy Functionality • Feeder switching and  reconfiguration • Voltage control g • Equipment health monitoring Benefits • Lower distribution operations  and maintenance costs • Higher reliability and power Higher reliability and power Sources: S&C Electric, Cooper Power Systems quality • Energy savings from customer  equipment and distribution equipment and distribution©2011 Navigant Consulting, Inc. 4 ENERGY
  6. 6. SynchroPhasor TechnologySynchroPhasor technology will monitor electrical conditions across regional grids and deliver that information to operators. regional grids and deliver that information to operators Functionality • Wide area monitoring • System visualization • Advanced control applications Advanced control applications Benefits • Higher grid reliability • Reduced transmission  congestionSources: Southern California Edison,  • Better management of variable Schweitzer Engineering Laboratories renewable energy resources©2011 Navigant Consulting, Inc. 5 ENERGY
  7. 7. DOE ARRA Smart Grid ProgramsDOE’s ARRA Smart Grid Investment Grant and Demonstration programs have been a critical catalyst for US smart grid deployment.programs have been a critical catalyst for US smart grid deployment American Recovery and Reinvestment Act Smart Grid Programs Smart Grid Investment Grant Program Smart Grid Demonstration Program • $3.4 billion in federal funding • Regional Smart Grid Demonstrations • $8.2 billion of total project value • 16 projects selected • 99 projects selected • $435 million in federal funding • Project categories: • $877 million of total project value • Customer Systems • Energy Storage Demonstrations • Advanced Metering  • 16 projects selected Infrastructure I f t t • $185 million in federal funding • Distribution Systems • $770 million of total project value • Transmission Systems • Equipment Manufacturing Equipment Manufacturing • Integrated and Crosscutting There are also ten Renewable and Distributed Systems Integration (RDSI) and High Temperature Superconductor projects.©2011 Navigant Consulting, Inc. 6 ENERGY
  8. 8. Increasing Smart Grid FunctionalityIn the coming years, smart grid technologies will support higher functionality and grid automation.functionality and grid automation• Leverage the sensors and  Automation communications networks  Remote installed during the first  Control wave Sensing and Reporting• Use the technologies to  develop “apps” that enable  operational efficiency,  • Increase speed to impact resilience, and optimization • Standardize processes • Reduce cost©2011 Navigant Consulting, Inc. 7 ENERGY
  9. 9. Smart Grid BenefitsThe resultant benefits will come from areas that have been difficult to demonstrate and monetize in the past.demonstrate and monetize in the past Smart Grid Benefits Type Description Examples Benefits related to utility or consumer costs that • Reduced T&D operations costs Easier to Financial can be expressed directly in financial terms terms. • Lower electricity bills for customers monetize Benefits related to power interruptions or power • Shorter power outages Reliability quality, but that may not be easily expressed in • Less severe voltage sags financial terms. • Reduced CO2 emissions Environmental Benefits related to air polluting emissions. • Reduced SOx and NOx Benefits related to maintaining a secure energy • Reduced oil consumption Harder to Security supply and infrastructure. • Fewer, or smaller blackouts monetizeSource: Navigant©2011 Navigant Consulting, Inc. 8 ENERGY
  10. 10. A Tool to Monetize Smart Grid Benefits Navigant’s Smart Grid Computational Tool is based on a rigorous  analytical framework being utilized for over 140 U.S. projects. analytical framework being utilized for over 140 U S projects Inputs Outputs Smart grid project  S a t id oje t AMI/Smart Meters,  A I/ Assets, Functions,  Automated Feeder  and Line Switching Monetary Value  and Mechanisms of up to 22  Data that  Annual Generation  Benefits corresponds to  Costs, Number of  Impact Metrics Tamper Detections All Output  Data derived from  Value of Service,  is calculated  NPV Analysis  estimates and  over  assumptions Price of Capacity at  Peak, Value of CO2 SGCT multiple  of Project of Project Discount Rate,  years  Cost Parameters  Inflation Rate,  and Escalation  Population  Factors Sensitivity  Sensitivity Growth G h Analysis of  High and Low case  Project Sensitivity Factors Value of CO2 Source: Navigant©2011 Navigant Consulting, Inc. 9 ENERGY
  11. 11. Metrics to Demonstrate ImpactAchieving smart grid benefits will require metrics that demonstrate impact.impact Performance metrics can be used to demonstrate smart grid impact Smart Grid Strategy • Operational efficiency • Reliability improvement • Customer satisfaction Lessons Systems • Customer demand profiles Learned Deployment • Capital investment deferral • Asset utilization • Electricity cost savings Performance • Fuel savings Measurement • Generation mix • CO2 reductions©2011 Navigant Consulting, Inc. 10 ENERGY
  12. 12. KeyC O N T A C T S CONTAC TS Forrest Small Director Burlington, Massachusetts, USA +1 (781) 270‐8303 F S ll i©2011 Navigant Consulting, Inc. 11Confidential and proprietary. Do not distribute or copy. ENERGY