* U.S.Smart Grid investment from 2007-2020 is forecasted to be in the range of $70-120 Billion *

Touch, Reach,Digitize:

Are utilities looking hard enough at Smart Grid’s
communications backbone?

By Robert Robinson & Mark Hoffman
Upgrading the U.S. electric
power distribution
grid is one of the last
greenfield technology
transformations awaiting
our economy, and the
ramifications of utility investment that will
be required should not be underestimated.
Technology innovations in power delivery
have been fermenting for years, but only
now is the confluence of physical needs and
social expectations creating an environment
in which real and sustained monetary
commitments are being made to create a
“Smart Grid,” built on information-based
devices, digital communication, and advanced
analytics.
We believe that the feasibility and merits
of a highly integrated Smart Grid are now at
hand, and that tangible functionality is available
to be deployed in the near term. The
issue is no longer whether such a grid can
be created, but when it will be implemented
and what functionality it will contain.
To achieve the full potential of Smart
Grid, a communications network must be
in place to allow the existing power distribution
grid to monitor and measure usage
in real time, visualize network performance,
and create an enablement platform
that engages everyone from system operators
to customers very differently.

One key decision that utilities and regulators
now face is to select the backbone
digital communications infrastructure
that provides the most prudent long-term
platform from which to extract end-to-end
Smart Grid benefits. No single technology
is appropriate for every situation across
the U.S. power industry’s distribution
footprint, but if you envision an end-game
that incorporates true nodal digitization of
the grid, we believe a compelling case can
be made for a communications infrastructure
based on Broadband over Power Line
(BPL) technology. For utilities that adopt
the infrastructure philosophy of touch,
reach and digitize, BPL can provide a sustainable,
long-term foundation for differentiated
Smart Grid outcomes.
Making a Decision
For utility executives, a technology investment
the scope and scale of Smart Grid
is daunting. All-in, the cumulative U.S.
Smart Grid investment from 2007-2020 is
forecasted to be in the range of $70 - 120
Bn, a very wide range highlighting many
uncertainties. The risks posed by committing
to significant infrastructure additions
are very real, and overcoming these risks
necessitates broad regulatory and stakeholder
engagement. A healthy and open
debate on end-game Smart Grid requirements
is a must.
For utility regulators, the “bargain” for
long-term return-on-investment certainty
requires the extraction of full and fair technology
potential on behalf of customers,
while also allowing the business case for
Smart Grid to claim forward social benefits
that the utility cannot realistically capture
within its regulated cost of service. As regulators
decide the merits of grid digitization,
they need full visibility into how these
backbone decisions might play out.
For many, Smart Grid business cases
have been a long time in the making, emanating
largely from ~ 15-year efforts to
justify the economics of automated meter
reading (AMR). While the terminology
and technology have evolved, an advanced
metering infrastructure (AMI) is still the
anchor benefit in virtually all Smart Grid
analyses. Digital meter functionality and
the associated communications infrastructure
to enable it are the largest two investment
costs that utilities must recover in
rate base.


READ MORE: http://www.currentgroup.com/news/releases/11-07_Utility_Products.pdf?prid=1094