New York Times: A Mad Dash for Smart-Grid Cash

September 15, 2009, 10:13 AM
A Mad Dash for Smart-Grid Cash
By JOHN COLLINS RUDOLF

By the time the late August application deadline had expired, a Department of Energy program to distribute $615 million to fund projects demonstrating smart-grid technology had attracted 140 proposals requesting a total of $2.3 billion.

“The response is very encouraging,” said Jen Stutsman, a spokeswoman for the Energy Department. “We expect some very competitive projects.”

With companies required to chip in 50 percent of the cost, the $615 million in grants will support at least $1.2 billion in smart-grid projects.

The term “smart grid” covers a number of approaches to modernizing the nation’s aging electrical infrastructure (see video above). Innovations run the gamut, from home thermostats that automatically adjust in response to overall demands on the grid, to advances in power transmission and energy storage, which will help integrate resources like wind and solar into the nation’s electrical mix.

The aim of the Energy Department program — part of the $3.9 billion in stimulus funds targeting the nation’s electrical system — is to take smart-grid technologies out of the laboratory and test their wide-scale viability and cost-effectiveness.

So far, the Department of Energy is keeping details of the proposals confidential, but a number of the nation’s largest utilities, including American Electric Power, Pacific Gas & Electric, and Southern California Edison, have publicized their applications.

Defense contractors like Boeing, Lockheed Martin and Raytheon are also in the mix, in partnership with utilities to provide security for the digital communication network at the heart of many smart-grid technologies, as well as other technical expertise.

(The green energy blog Earth2Tech.com has compiled a list of companies applying for funds.)


Several proposed demonstration projects seek to build a narrow, top-to-bottom smart-grid system — what Paul De Martini, a vice president of advanced technology at Southern California Edison, called “a deep vertical slice of a smart grid.”

That company’s $40 million grant proposal, planned for Irvine, Calif., incorporates smart meters, solar panels, home energy storage and plug-in electric vehicles. It also includes “self-healing” transmission circuits and other advances in grid-level power distribution. “We have an opportunity to see how all of these will really work together in a single system,” Mr. De Martini said.

Pilot projects that help consumers manage energy use within their homes – by installing devices like programmable communicating thermostats, which can respond to systemwide changes in electrical demand – could yield some promising results, said Sunil Sharan, a senior fellow at the Center for American Progress and a former director of a smart-grid initiative at General Electric.

“If you asked me what is realistic, I would say in-home energy management technology,” Mr. Sharan said.

Energy storage is another area of interest for the smart-grid demonstration grant program. Devising cost-effective, reliable and scalable energy storage is seen as a major challenge for utilities, as larger and larger sources of intermittent energy, like wind and solar, come online.

“Energy storage is pretty tricky,” said Mr. Sharan, who added that federal funding was unlikely to be enough to tackle the problem.

Still, storage proposals abound. Several companies are exploring compressed air energy storage, in which air is pumped underground at high pressure and released later to generate power.

And Southern California Edison has applied for an additional $25 million from the Department of Energy to build the world’s largest lithium-ion battery.