Energy Blog: Smart Grids & True Energy Efficiencies

By Andy Silber

A Tale of Two Talks: Smart Grid and Reinventing Fire

In the last week I’ve attended two talks: a breakfast meeting hosted by the Washington Green Tech Alliance on the Smart Grid and a talk by Amory Lovins founder of the Rocky Mountain Institute on their Reinventing Fire plan. These talks reminded me of the opening of one of Dickens great novels (great as in big), not because one of them was bad, but because they had very different approaches. The smart grid talk got into the weeds and details and challenges in rolling out new technology covering a small part of the electrical system with a timescale of about 5 years. The Reinventing Fire talk was a grand plan covering how the entire electrical and transportation systems could change over the next 40 years. They did have some things in common:

  • The both lasted about 90 minutes, with time for questions
  • They were well attended by an interested audience that asked good questions
  • They left one feeling hopefully about the exciting things that are happening and what’s possible if we only try

Smart Grid

A group crowded into the conference room of a downtown investment firm, sharing coffee and pastries. For $25 I thought we might get something other than baked goods, but I wasn’t there for the food, but the topic. The panel included a manager for a big firm working on the all aspects of the grid to the CEO of a start-up only working on a Smart Grid application.

One nice thing about the panel is that they are all local.

When considering the challenges of a Smart Grid, it’s good to start with a definition. If you get 3 people in a room who are working on Smart Grid, you’ll probably get 3 definitions, but there are a few things everyone agrees with:

  • It is not JUST a Smart Meter or Advanced Metering Infrastructure. Randy Berry said “The dumbest thing you can do is just install a Smart Meter”.
  • Communication is a key component
  • It enables customers to use less power during peak times and more power when the system can easily delivery it (e.g. at night when a wind farm is producing and the demand is otherwise low)
  • It also provides value to the utility that is not obvious to the customer (e.g. monitoring the voltage at the house, allowing the utility to more efficiently deliver energy)

Some people are just talking about the grid from the customer to the utility. Others include HVDC power lines connecting windfarms to distant cities.

Some applications are very obvious, but aren’t happening yet, because the utility and your appliances don’t communicate.

  • Only defrost your freezer in the middle of the night
  • Electric hot water heaters setting the thermostat high (e.g. 160° F) in the middle of the night, changing to standard heating (120° F) during times of higher demand.

These applications require the kind of communications that has been standard in the IT industry for decades. But with a few exceptions, the technology used in distributing electricity would all look familiar to Tesla. So the challenge of the Smart Grid is to apply already commercialized technology and concepts in a very conservative field.

One interesting thing that the panel agreed about is the standard tech-startup model of

  1. start a company
  2. develop a technology
  3. build a customer base
  4. go IPO
  5. get rich

doesn’t work because the customer is usually the utilities, which won’t buy from a small guy. They’re too risk adverse and don’t trust something that hasn’t been proven. So the model in this space is

  1. start a company
  2. develop a technology
  3. get bought by a big player (e.g. GE/Alstom/Siemens)
  4. don’t get rich, but you do OK

And the big boys are buying. Michael from Alstom talked about several recent acquisitions that Alston has made, where they figured it was faster to buy a company that helped them compete than develop the technology in-house.

Jim Holbery represented the only startup on the panel. He’s working on applying IT concepts to the grid, attaching data along with the electricity. Currently if you want to buy “Green Power”, your only option is to buy Renewable Energy Certificates (aka Green Tags) which perform accounting magic to separate the greenness from the power and sell them to different people. GridMobility’s idea is to actually track where the power came from and sell you real green power. To be honest, given the mixed up nature of the grid, it’s like mixing organic and non-organic berries in a bucket and trying to separate out the organic ones at the store and just sell you those. His hope is to partner with the big players like Alstom.

The one thing that I found disappointing about the panel (and the field) is that it was all about the retail/local grid. If you’ve been reading my posts, it’s pretty obvious that I think the most important element that we need to develop is long-distance transmission that can efficiently bring in utility scale renewables to the distant customers who live where there isn’t nearby renewable resources. This was not a topic that any of the panelists are working on. The Smart Grid that we discussed saves little energy, but does help shift consumption to better times. This helps reduce blackouts and effectively integrate intermittent renewables like wind power, which are good and important, but insufficient on their own. Integrating renewables isn’t very valuable if you live where there aren’t renewable resources.

Reinventing Fire: A Talk by Amory Lovins

First off, if you don’t know who Amory Lovins is, shame on you. He may look like Frank Oz,

but he’s a superhero to me. He basically invented the idea was energy efficiency with the publication of Energy Strategy: The Road Not Taken?” in Foreign Affairs, 1976. He founded the Rocky Mountain Institute (RMI), which he calls a “Think and Do Tank” and does amazing work. Maybe I just like him because he’s also a physicist. Maybe because his most famous quote involves beer, “All people want is cold beer and hot showers.”

His talk covered the RMI’s Reinventing Fire concept. This program has the modest goal of driving the consumption of oil and coal to zero by 2050. They believe that this is possible while reducing the consumption of natural gas and building no new nuclear plants. He claims that this can happen driven by corporations trying to maximize their profits with only small actions by the government. He assumes that there will not be a carbon tax or cap and trade or any other effort by the government to internalize the cost of carbon.

As always, Amory’s focus is on using energy more efficiently. One example he talked about was the Hyper Car concept. By making cars out of advanced materials the weight of a car can be reduced by more than half, reducing the fuel consumption. A lighter car needs a smaller engine, saving more weight and more fuel. This also makes electric cars cheaper, since the largest cost is the battery and a light car won’t need as many to go a given distance. This allows electric cars to go mainstream sooner, encouraging more research on advanced batteries that further reduce costs and increase range. By 2050 cars can be using so little liquid fuel it’s fairly easy to supply that with biofuels (not corn ethanol, which received applause from the audience). The interesting thing was he gave lots of examples where car companies are currently working on bringing these concepts to the market in the next few years, including a factory in Moses Lake that will be building material for BMW.

He also talked about using roads more efficiently, more efficient pumps and motors, and lots of other topics. The basic story was repeated over and over. We waste a lot of energy. Once we cut out the waste, it’s easy to clean up what remains. And we can do this while improving the economy and everyone still gets cold beer and hot showers.

The presentation was only about 30 minutes, followed by some questions from Seattle’s Denis Hayes and the audience. In true Lovins style he covered a lot of territory and it was basically whetting our appetite for when it comes out in book form or to go to their web site and read more. His view is optimistic, but it’s backed up with real analysis and the assumptions he’s making are not unreasonable.

While the case he made for drastic increases in efficiency was fairly persuasive, he didn’t explain how renewable energy would replace existing coal plants without significant government action. Personally, I think that unless we institute some kind of preference for renewable energy (e.g. carbon tax, cap and trade, renewable energy standard), coal plants built in 1980 will still be operating in 2050. He also made reference to how abundant wind energy is, but I don’t believe that we’ll capture that without significant government investments in a national HVDC grid.

Lot’s of reasons to hope. Now get out their and conserve energy!!!