Smart Grid Technology: Networked Energy Efficiency of the Future

Replacing the nation’s outdated energy infrastructure with smart grid technology forms a core component of the Obama administration's call for U.S. energy independence. Currently, electricity is delivered to homes over a 20th century broadcast system. Central generators create and move power down transmission lines to users. The aging grid is susceptible to overload and outages, positioning it as a prime terrorist target. A smart grid, using two-way digital technology, would be able to respond to a wide range of factors to conserve energy, increase reliability, route around attacks, and revolutionize energy pricing. But what exactly is a smart grid?

Thanks to the growth of the Internet over the past 25 years, most Americans are familiar with the basic concept of a "network" even if they don't realize it. In computer terms, the Internet is a WAN or wide area network. Inside the home, computers and other devices that are connected to the Internet and potentially to one another, form a LAN or local area network. These networks communicate with one another to varying degrees, exchanging information and performing functions. For instance, if you access your DVR over the Internet from work to set a TV program to be recorded, you've used a WAN to connect to your home LAN and control a device there.

In the ultimate evolution of smart grid technology, a HAN or home area network would be formed by all the home's electronic devices, appliances, and central systems such as heating, cooling, and water. The HAN would, in turn, be linked to the smart grid, an intelligent monitoring system for tracking electrical flow. During peak use periods, when power is most expensive, the grid could, in theory, turn off given home systems to reduce load and save money for the consumer. Those customers continuing to draw power during the peak period would be charged more for the electricity.

Because a smart grid is a two-way street, however, it would also better handle the flow of power from a home's renewable energy sources like a home solar system or residential wind turbine. By law, utility companies are required to buy the electricity produced by these home systems via a method called net metering, but currently many smaller companies have never been put in a position of doing so. The purchase requires the installation of a meter capable of running both forwards and backwards.

More utility companies are launching pilot programs for the installation of smart meters that allow homeowners to see exactly how much power their homes are using at any given moment. This monitoring capability encourages changes in energy use behavior because the instant lights or appliances are turned off, the homeowner sees the result on the smart meter. Smart meters, however, are only the first and smallest step toward the envisioned smart grid of tomorrow.

A smart grid will enhance connectivity and automation, coordinating the activities of both suppliers and consumers. The goal is optimal performance, eliminating brown-outs and outright failures like those California often experiences during the summer. Further, the technology will redefine how power moves on the grid, accommodating and rewarding the efforts of businesses and consumers generating their own electricity from renewable energy sources. Basically then, "smart grid" is an umbrella term encompassing wide-ranging changes to modernize electrical generation, transmission, and distribution.

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