Creating a Smart Grid Deployment Plan
The Smart Grid allows customers to have better control over their energy usage, increases renewable generation while reducing greenhouse gas emissions and improving system reliability, operational efficiency and customer privacy. Having a Smart Grid Deployment Plan makes room for advancement for a smart energy future while also providing new benefits to it's customers, society and the economy.
Smart Grid Strategy
I came across an article from a west coast utility that has developed a Smart Grid Deployment Plan that I thought I would share. Although this is a great start to developing your Smart Grid Deployment Plan, one major component of developing this plan that this article did not mention is Customer Communications. According to a Frost & Sullivan report, customers want to be able to interact with your company based on their choice. By proactively delivering relevant and educational information to the consumer, utility providers reduce costs and improve efficiencies while creating loyalty in your customer base.
The article's strategy relies on 3 pillars: policy, customer value and pilots. The policy for investment decisions are evaluated for least cost/best fit and for potential customer and societal benefits. When projected benefits outweigh the costs or the investment is necessary to effectively communicate with customers is where the strategy's customer value comes into play. The piloting pillar is there to mitigate risk and determine whether the technology investment will deliver the benefits anticipated and if it's within the projected costs. It's necessary to consider all aspects needed to evaluate and adopt a smart grid strategy. You can do this by following these steps:
- Identify applicable federal and state laws, reg
ulations, and policies
- Identify options that could meet those requirements
- Determine to what extent those options aid in meeting those requirements
- Determine to what extent those options enhance customer value
- Select solutions based on their fit to policy requirements, cost effectiveness, and customer value
Deployment Plan Costs
When developing the Smart Grid Deployment Plan, it's important to determine whether the project's costs are outweighed by its benefits. Develop and apply a thorough and comprehensive analysis of the proposed Smart Grid technology and infrastructure investments. You can use this breakdown as an example:
- Previously authorized investments
- Test Year General Rate Case
- Other active applications
- Estimated incremental investments
Benefits of a Smart Grid Initiative
Social Benefits - usually used to evaluate cost effectiveness by focusing on production efficiency, energy delivery, and environmental quality improvement. Those benefits include:
- added efficiency
- avoided generation costs including line losses
- avoided transmission and distribution costs
- reliability benefits to customers
- environmental benefits
Economic Benefits - Include avoided or reduced costs and investments due to improved system efficiency or asset utilitization.
Reliability Benefits - Include avoidance or reduction in electrical service interruptions and improvements in power quality and the reliability benefits to customers that are determined through value of service studies.
To view the utility's full Smart Grid Deployment Plan, follow this link.
An Important Component Missing
If you want to learn why Proactive Customer Communications is important in developing your Smart Grid plan, download our white paper.
Has your utility developed a Smart Grid Deployment Plan? We'd love to hear about it!
For questions, contact us at info@tfcci.com or 800-382-8356.