I. WHAT IS SMART GRID?
Simply stated, Smart Grid involves technologies to improve the way electricity is supplied, transmitted, distributed, stored and consumed, including, for example, new sensor, communication and information-sharing technologies.
In the Energy Independence and Security Act of 2007 (EISA), Congress declared that it is the policy of the United States to support the modernization of the nation's electricity transmission and distribution system to maintain a reliable and secure electricity infrastructure that can meet future demand, growth and to achieve each of the following, which together characterize a smart grid:
- Increased use of digital information and control technologies
- Dynamic optimization of grid operations and resources with full cyber security
- Integration of distributed resources including renewables
- Incorporation of demand response, demand-side resources and energy efficiency
- Deployment of real-time, automated, interactive technologies for metering, communications and distribution automation
- Integration of smart appliances and consumer devices
- Integration of electricity storage and peak shaving technologies including plug-in electric vehicles and thermal storage air conditioning
- Provision of timely information and control options to consumers
- Development of standards for interoperability
- Lowering of unnecessary barriers to smart grid technologies, practices and services
As described by the Federal Energy Regulatory Commission (FERC) in a proposed Smart Grid policy statement:
Smart Grid advancements will apply digital technologies to the grid, and enable real-time coordination of information from generation supply resources, demand resources and distributed energy resources . . . . This will bring new efficiencies to the electric system through improved communication and coordination between utilities and with the grid, which will translate into savings in the provision of electric service. Ultimately the Smart Grid will facilitate consumer transactions and allow consumers to better manage their electric energy costs. These technologies will also enhance the ability to ensure the reliability of the bulk-power system.