grid modernization industry trends, challenges and...

Grid Modernization

Industry Trends, Challenges and Solutions

Raleigh, NC

July 26, 2016

© 2016 Quanta Technology LLC


Grid Modernization

Grid modernization

“Hands-on” comprehensive portfolio of initiatives focused on

realizing Smart Grid / Grid of the Future vision

Deployment of incremental grid intelligence (technology),

infrastructure (foundational, IT/OT), and engineering processes

Utility of the Future

Long term utility vision adapted to projected business

environment

It covers business, regulatory, grid and customer aspects

Regulatory modernization

Required changes to existing regulatory frameworks to enable

utilities and customers to fully take advantage of opportunities

derived from grid modernization (Utility of the Future enabler)


Utility Of The Future Drivers

Need for new electric utility

business models and regulatory

frameworks

Deployment of cost-effective

DG Increasing adoption of

energy management technologies

Deployment of smart grid

technologies, products and

services

Growing adoption of PEVs and

BESS

Deployment of microgrids

Rise of data analytics

Expanded use of utility-scale

renewables

Increasing expectations

regarding resiliency

Customer interest for sustainable

energy options

Increasing expectations for reliability and power

quality

Customer interest for

greater control of energy use

and costs

Growth in energy

products and services

provided to customers by

3rd parties

Importance of cybersecurity


Grid Modernization – Key Industry Trends (1)

DER integration

Distributed Generation (DG), energy storage, demand response

Microgrids

Smart Inverters

IEEE 1547 Update

Business Models

Distribution Resources Plan (DRP)

Reforming the Energy Vision (REV)

Rate unbundling (demand charges)

Service diversification and evolving customer expectations

Transactive Energy and future grid architectures


Grid Modernization – Key Industry Trends (2)

OT/IT convergence, grid analytics, increased visualization and

real-time operation

Advanced DMS/OMS

DER Management Systems (DERMS)

Distribution Automation (FLISR, VVO)

AMI and advanced sensors (distribution PMU)

Reliability/Resiliency

Physical and cybersecurity

Weather hardening and aging infrastructure

Smart Cities


Key Modernization Driver – DER Integration

High penetration of DG (mainly PV) is already a reality in several

utility systems

DG interconnection can have significant and diverse impacts in

numerous business and technical activities of distribution utilities

Source: http://www.hawaiianelectric.com/heco/Clean-Energy/Integration-Tools-

and-Resources/Locational-Value-Maps


7

Source: Deutsche Bank

Source: Morgan Stanley

Projected PV prices vs. Utility Rate (Illinois)Levelized Cost of Electricity (LCOE) minus average electricity price in States

When grid parity will be reached is still uncertain and a matter of

debate

Financial institutions like Morgan Stanley, Deutsche Bank and

Barclays have forecasted it will happen in the next decade in many

states of the US

Grid Parity


PV distributed generation is experiencing significant growth

Prices continue decreasing despite falling state/utility incentives

Source: Tracking the Sun VII An Historical Summary of the Installed Price of Photovoltaics in the

United States from 1998 to 2013

Grid Parity: PV Prices


Grid Parity: Battery Prices

Source: http://homerenergy.com/pdf/RMI_Grid_Defection_Report.pdf

Source: Deutsche Bank, Department of Energy (DOE), Tesla

Historical Battery Prices ($/kWh)


Average residential customer monthly bill today approx. $110

(Source: EPRI)

Energy = $70; Distribution = $30, Transmission = $10

Utility model based on kWh sales, but with stagnant (or decreasing

sales due to DER proliferation), rates would go up to pay for needed

grid investments (“utility death spiral”)

Result = Rate fatigue and grid defection (when and if feasible) unless

VALUE demonstrated

Grid/Load Defection


• Grid modernization strategy must

address challenges prompted by

grid transformation drivers and

take advantage of emerging

opportunities

• Developing business and

technology roadmaps

• Addressing and preparing

for various scenarios

• Deploying pilot projects to

test and prepare for changes

• Developing and applying

industry standards

• Developing a skilled workforce

Speed and success will depend on clear and balanced

regulatory policies to promote safe, cost-effective, and

reliable deployment of technologies

Grid Modernization Strategy


Grid Modernization Framework & Roadmap


DER – What is the industry doing?

Long-term (focus on business processes, infrastructure

and information systems, and regulatory and policy

aspects):

• Utilities are updating applicable business processes and practices

(e.g., engineering standards, annual planning cycle, load

forecasting) to consider DG integration as an intrinsic component of

their regular activities

• Utilities are upgrading distribution assets, information technology,

communications, and enterprise system infrastructures to gather

and process the data required to operate modern distribution

systems with large penetration levels of DG (e.g., sensor, DA and

PMU deployment)

• Utilities are exploring new concepts to fully take advantage of the

potential benefits of DG proliferation (e.g., microgrids)

• Utilities are participating in industry activities to share experiences,

and are training their engineers to analyze, plan and operate

modern and future distribution systems


California – Distribution Resources Plan (DRP)

http://www.cpuc.ca.gov/General.aspx?id=5071



Distribution Planning – Hosting Capacity

Source: Results from the DOE-CPUC High Penetration Solar Forum http://energy.gov/eere/solar/downloads/results-doe-cpuc-high-

penetration-solar-forum

http://energy.gov/eere/solar/downloads/results-doe-cpuc-high-penetration-solar-forum


Power System Criteria – DER Capacity Limits




Methodology and Calculations




Examples – Hosting Capacity Maps

Examples (California IOUs):

SCE’s DER Interconnection Maps (DERiM):

on.sce.com/derim

PG&E’s Solar Photovoltaic (PV) and Renewable Auction

Mechanism (RAM) Program Map:

http://www.pge.com/b2b/energysupply/wholesaleelectricsupplier

solicitation/PVRFO/pvmap/

SDG&E’s Distribution System Available Capacity:

http://www.sdge.com/generation-

interconnections/interconnection-information-and-map

http://www.arcgis.com/home/webmap/viewer.html?webmap=e62dfa24128b4329bfc8b27c4526f6b7

http://www.pge.com/b2b/energysupply/wholesaleelectricsuppliersolicitation/PVRFO/pvmap/

http://www.sdge.com/generation-interconnections/interconnection-information-and-map


Locational Value Components (PG&E)




PG&E Load Forecasting Tool




How will DG affect load forecasting? Answering this

questions requires considering numerous aspects

Besides traditional uncertainties regarding customer

load growth, additional variables include DG technology,

uncertainty about DG penetration levels, uncertainty

about spatial distribution of DG

Other variables include penetration of additional smart

grid technologies and concepts, e.g., PEVs, demand

response, NZE, energy efficiency, etc

Spatial load forecasting and scenario analysis are good

alternatives to evaluate the individual and joint impact of

these technologies on capacity planning

Load forecasting and Capacity Planning


Base scenario – year 0


Base scenario – year 20


Grid Modernization Initiatives: New Models (DSO)

Source: resnick.caltech.edu/docs/21st.pdf


Grid Modernization Initiatives: New Models (DSP)

Market Operations

• Rich information for consumers and suppliers

• Diverse technologies, products and services

• Transparency, flexibility, and efficiency

Grid Operations

• Secure, reliable and resilience

• Flexible and dynamic

• Economical and energy efficient

Integrated System

Planning

• Diverse and distributed energy resources

• Coordination with bulk system

• Integration with market and operations drivers

Market Operations

• Rich information for consumers and suppliers

• Diverse technologies, products and services

• Transparency, flexibility, and efficiency

Grid Operations

• Secure, reliable and resilience

• Flexible and dynamic

• Economical and energy efficient

Integrated System

Planning

• Diverse and distributed energy resources

• Coordination with bulk system

• Integration with market and operations drivers

DistributionSystem

Platform(DSP)

Source: New York State Department of Public Service, WG-2: Platform Technology, July 2014

http://www3.dps.ny.gov/W/PSCWeb.nsf/96f0fec0b45a3c6485257688006a701a/bd6cb06f9ad375

dd85257d0f0053f76e/$FILE/Platform%20Technology%20(Working%20Group%202).pptx


Grid Modernization Initiatives: New Models (DSP)

• Fuel and resource diversity• System reliability• Reduced carbon emissions

Gri

d O

per

atio

ns

Mar

ket O

per

atio

ns

ISO DSPP Customers

“Wholesale” Energy and Capacity

“Wholesale” Market Administration

Basic and Value Added Services *

Wide Area View

Bulk Operations(115 kV and above)

“Wholesale” Ancillary Services

“Retail to Wholesale” Aggregation*

Regional/Local View

T/D/Microgrid Ops(115 kV and below)

“Retail” Market Administration

Central Generation Management

DER Management

Direct Access (Individuals)

3rd PartyService Providers

“Premise” View

DER Operations

“Premise” or MicrogridOperations

*Provide or enableSource: New York State Department of Public Service, WG-2: Platform Technology, July 2014

http://www3.dps.ny.gov/W/PSCWeb.nsf/96f0fec0b45a3c6485257688006a701a/bd6cb06f9ad375

dd85257d0f0053f76e/$FILE/Platform%20Technology%20(Working%20Group%202).pptx


Utility Initiatives – ComEd (Exelon)

Source: http://energy.gov/sites/prod/files/2014/10/f18/02a-APramaggiore.pdf

http://energy.gov/sites/prod/files/2014/10/f18/02a-APramaggiore.pdf



Source: http://library.cee1.org/sites/default/files/library/12421/CEE_Industry_Partners_2015_-_Welcome_to_Chicago_-_Val_R._Jensen.pdf

http://library.cee1.org/sites/default/files/library/12421/CEE_Industry_Partners_2015_-_Welcome_to_Chicago_-_Val_R._Jensen.pdf



Source: https://www.cavs.msstate.edu/iPCGRID_Registration/presentations/2015/Svachula_Bahramirad_i-

PCGRID_2015_Microgrid_Deployment_and_Vision.pdf

https://www.cavs.msstate.edu/iPCGRID_Registration/presentations/2015/Svachula_Bahramirad_i-PCGRID_2015_Microgrid_Deployment_and_Vision.pdf


DER Integration Trends & Emerging Solutions

IEEE 1547 Update

Smart Inverters

Future design, planning and operation modes of distribution feeders

(closed-loop operation)

Real-time monitoring and control of T&D grids, including ADMS,

DERMS and distribution applications of PMUs

Advanced protection and automation applications, e.g., adaptive

protection, DER-enabled FLISR

Distributed Energy Storage

Microgrids

Power electronics based voltage regulation equipment, distribution

class FACTS devices (FACDS)


IEEE 1547 Series of Standards & Guidelines

Source: 1547 website


The Western Electric Industry Leaders (WEIL) Group urged the

Adoption of Smart Inverters on All New Solar Generators

http://www.sdge.com/newsroom/press-releases/2013-08-07/weil-

group-urges-adoption-smart-inverters#sthash.zOs1LNcW.dpuf

Smart Inverters


Connect/disconnect

Maximum generation limit

Fixed power factor

Intelligent volt-VAR

Volt-Watt

Frequency-Watt

Watt-power factor

Price or temperature driven

Low/high voltage ride-through

Low/high frequency ride-through

V1, Q1, P1

% A

va

ilab

le V

AR

s

Percent VoltageV2, Q2, P2

V3, Q3, P3

V4, Q4, P4

V = 1.0 PU

Absorb

VARs

Inject

VARs

Smart Inverter Functions


Dynamic reactive current support

Real power smoothing

Dynamic volt-watt

Peak power limiting

Load and generation following

DER settings to manage multiple grid configurations

Battery storage:

Direct charge/discharge management

Priced-based charge/discharge

Coordinated charge/discharge

Smart Inverter Functions – cont.


A microgrid operates

within a clearly

defined electrical

boundary that can

act as a single

controllable entity

with respect to the

grid and can connect

and disconnect from

the grid to enable it

to operate in both

grid-connected or

island mode

Grid Modernization Initiatives: Microgrids

G

Sub-transmission

Full

Substation

Microgrid

Full Feeder

MicrogridSingle

Customer

Microgrid

Partial

Feeder

Microgrid

Neighbor

Feeder

Distribution

Substation

Secondary

System

Microgrid

G

G

G

G

G

G

Single

Customer

Microgrid

G Normally

Open Tie


116 Microgrid projects:

• 81 Operational

• 35 Under development

Regional hotspots:

• California

• Hawaii

• Northeast

Source: GTM Research North American Microgrids 2014: The Evolution of Localized Energy Optimization

Microgrid Landscape (1)


Operational Microgrid Capacity = 965 MW

Small scale:

• < 1MW

• Includes part of a feeder, one or more buildings

Medium scale (largest number):

• 1 MW – 10 MW

• Includes an entire feeder

Large scale

• 10 MW – 50 MW and > 50 MW

• Includes several feeders

Source: GTM Research North American Microgrids 2014: The Evolution of Localized Energy Optimization

Top Microgrid States by Capacity (MW) and Installation Number

Microgrid Landscape (2)


An iterative study and analysis process

Microgrid Planning Steps

Load Analysis

Analysis of the data to obtain load profiles and identify restrictions

Reliability Analysis

Calculation of reliability parameters for all customers, determination of

customer categories

System Design

Circuit Topology, Operating strategies, Possible cases (base and advanced) for

microgrid development

Generation Mix

Selection of generation: PV, solar, natural gas , wind turbine,

energy storage systems, etc.

Business Case

Detailed development of a business model for potential projects

Controls & Communications

Potential communication architecture and associated requirements


Regulatory Challenges:

Ownership of generation

Administrative burden of

regulation

Business Challenges:

DG technologies still costly and with uncertain lifetimes

Business model still undeveloped – how to capture true

revenue?

Technical Challenges:

Bi-directional power flows

Fault current contribution

Unit Level Volt/VAR

support

Islanded Operation

Microgrids challenges

Integration Challenges for Utilities


Business Challenges

Cost effectiveness and justifications

Approval & certification processes for introducing new

technologies

Permitting (site & environmental)

Regulatory requirements (state and regional rules)

Lack of guidelines and standard practices

Ownership and governance matters

Integrating in existing DMS/EMS for operation through

control centers

Knowledge transfer and training of personnel


Storage as a Game Changer

Challenges:

Safety Concerns

Limited Load Diversity

Limited Grid Benefits

Less Standardization

High Cost

240/120 V69 kV 4 - 34 kV 480 V138 kV345 kV

Distributed(Community)

1-20 MW(Substations)

Storage

Value

Challenges:

Limited Value to Customer

Security & Reliability Risk

Less effective in removing Grid Congestions

High engineering cost (no commodity)

Central Storage Distributed Storage

100s of MW

(central)

Residential

Shipping

Containers

C&I, Microgrids

High accumulated value at

Edge of Grid

Keeping on Utility Side,

rate-basing installs is a key

enabler

Shipping

Containers

Small

Boxes

208 V


Grid Modernization Initiatives: Data Analytics

Grid analytics

• Grid analytics is expected to play a key role in grid

operations, asset and outage management, and planning

Source: http://www.accenture.com/microsite/digitally-enabled-grid/Documents/pdf/Accenture-

Grid-Analytics-Report-Digitally-Enabled-Grid-2.pdf


Smart Distribution – Real-Time Awareness

Source: http://eetd.lbl.gov/news/article/58572/searching-for-real-time-measure

http://eetd.lbl.gov/news/article/58572/searching-for-real-time-measure


Potential PMU applications in distribution

Source: Toward Micro-synchrophasors (μPMUs) for Distribution Networks


Distribution state estimation

Source: RTWH Aachen


Examples of Products

SEL-2431 Voltage Regulator

Control

SEL-751 Feeder Protection

Relay


Deployment Example

Substation

3 MW

PV

Auto-Cap

1.8 MVAr

PSAuto-Cap

1.8 MVAr

Auto-Cap

1.2 MVArAdjacent

Feeders

I I

PS

I I

1.5 MW

PV

XX

Auto-Cap

1.2 MVAr

I I

PS

RCS

R


Existing Engineering, Operations and Safety Procedures

Power Flow Models

(Synergi)

Historical Data (Load,

Interruptions, Reliability

Indices, etc.)

Root-Cause Analyses

Development of Predictive

Reliability Models

Existing T&D System

Features

Clustering and Representative

Feeder Selection

Simulations & Analysis

Project Prioritization and Expected Improvement

Estimation

Development of Protection

& Distribution Automation

Planning Guidelines

Benefit-Cost Analyses for

Representative Feeders

Existing Communications

Systems & Infrastructure

Selection of Solution Portfolio

Protection & Distribution Automation

Planning Guidelines

Reliability Improvement

Targets

Extrapolation to Feeder Clusters

Automation/Reliability/Protection Convergence


Optional steps needed for large scale (e.g., system-wide)

studies:

Clustering and representative feeder selection

Extrapolation to feeder clusters

System aggregation

Automation/Reliability/Protection Convergence

Extrapolation to Feeder Clusters

Overall Cost-Benefit Analyses

System AggregationPreparation of Deployment

Roadmap

Deployment Roadmap

Protection & Distribution Automation

Planning Guidelines


Spatial distribution of expected SAIDI before (hr/cust-yr)

SAIDI > SAIDI < Color

0 0.5

0.5 1

1 1.5

1.5 2

2 2.5

2.5 3

3 3.5

3.5 4

4

Examples – Area (SAIDI Before)


Spatial distribution of expected SAIDI after (hr/cust-yr)

SAIDI > SAIDI < Color

0 0.5

0.5 1

1 1.5

1.5 2

2 2.5

2.5 3

3 3.5

3.5 4

4

Examples – Area (SAIDI After)


Source: http://www.forbes.com/sites/jacobmorgan/2014/09/04/cities-of-the-future-what-do-they-look-like-how-do-we-build-them-and-whats-their-impact/

Grid Modernization Initiatives: Smart Cities


Electric utilities are starting to face important challenges in the key

aspects of their business as a result of the ongoing and rapid

transformation of the grid

Addressing these challenges requires a coordinated portfolio of new

and existing solutions that must encompass technology,

infrastructure, regulation, policy and business aspects

Grid modernization strategies and roadmaps allow utilities

proactively address the evolving challenges and opportunities

triggered by grid transformation

Grid modernization strategies and roadmaps need to address a

variety of issues such as foundational infrastructure deployment,

improvement of existing processes and introduction of new

processes, implementation of technologies for incremental grid

intelligence and awareness, and innovation and R&D

Summary


1. Utility of the Future Pulse Survey

http://assets.fiercemarkets.com/public/sites/energy/reports/dnvkem

areport.pdf

2. Annual Energy Outlook 2014 With Projections to 2040

3. Commercial Rooftop Revolution http://www.ilsr.org/wp-

content/uploads/2012/12/commercial-solar-grid-parity-report-ILSR-

2012.pdf

4. Solar Parity Map http://www.ilsr.org/projects/solarparitymap/

5. The Economics of Grid Defection: When and Where Distributed

Solar Generation Plus Storage Competes with Traditional Utility

Service

http://homerenergy.com/pdf/RMI_Grid_Defection_Report.pdf

References

http://assets.fiercemarkets.com/public/sites/energy/reports/dnvkemareport.pdf

http://www.ilsr.org/wp-content/uploads/2012/12/commercial-solar-grid-parity-report-ILSR-2012.pdf

http://www.ilsr.org/projects/solarparitymap/

http://homerenergy.com/pdf/RMI_Grid_Defection_Report.pdf