Smart Grid Plugs in for Boulder

Imagine a future when you can use the Internet to program when your appliances run to take advantage of lower electric rates during off-peak hours—or to run when your utility has energy available that is produced by wind or solar. A future when your electric company can remotely detect that a transformer is close to failing and prevent a blackout from occurring. A future when plug-in electric cars are charged from home solar arrays and can send power on demand to the grid, collectively acting as a small, clean power plant.

That future is unfolding right now in Boulder, CO, as Xcel Energy—the state’s largest utility that also operates in seven other states—continues to build out what it calls the nation’s first SmartGridCity.

And the dream of a smart electric grid—a modern, digital age electric power distribution system that allows sophisticated two-way communication between consumers and utilities and among various parts of utilities’ infrastructure—is getting lots of attention from both government and industry.

The economic stimulus package signed into law by President Barack Obama in February includes about $4.5 billion for smart-grid technology, and utilities, technology companies, and cities are scrambling to get a piece of that pie. “Competition will be keen,” reports Bloomberg, noting the recent announcement of the smart grid Pecan Street Project in Austin, TX, which aims to—among other things—produce a power plant’s worth of energy within the city limits using renewable resources.

In signing the legislation, Obama spoke of the smart grid’s possibilities: “Today, the electricity we use is carried along a grid of lines and wires that date back to Thomas Edison—a grid that can’t support the demands of this economy…. The investment we’re making today will create a newer, smarter electric grid that will allow for broader use of alternative energy…. This investment will place smart meters in homes to make our energy bills lower, make outages less likely, and make it easier to use clean energy.”

Begun well before the stimulus package was even under consideration, the $100 million investment in Boulder by Xcel and a group of technology companies is emerging as a real-world laboratory for a range of smart-grid technologies, and it hopes to determine how much appetite consumers have for asserting more control over their energy use.

“We want to experiment and see what works and what doesn’t,” said Roy Palmer, Xcel’s vice president for federal and state government affairs.

Xcel’s SmartGridCity project is an attempt to take an electric grid that has changed little over the last 100 years and yank it into the 21st century. The overriding goals are to empower customers to manage their electrical use and conserve energy, to greatly increase system efficiency, to expand the use of renewables so fewer fossil fuel power plants are needed, and to cut carbon emissions.

The backbone of the project is a broadband information network wired into power lines that gives customers a wealth of information about their power consumption. It allows Xcel to monitor in real time both household energy use and how its complex distribution system is functioning.

So far, Xcel has laid more than 100 miles of fiber optic cable and installed about 15,000 “smart meters” in Boulder homes. Xcel can closely monitor how consumers are using electricity and see on a computer screen when problems are developing at substations and transformers. Instead of learning from customers that a power outage has occurred and then sending repair crews out on “truck rolls” to find the source of the trouble, Xcel will know instantly that power has been interrupted and exactly where the problem is—or even prevent outages altogether. Consumers in turn can see how much power is being consumed by their appliances through the smart meters and change habits to save money and power.

When the system is fully installed, about 10,000 Boulder homeowners will be able to manage their energy use through a website. Unexpectedly staying at work an extra two hours? Go on the Internet—even via mobile devices—and reset the thermostat so the heat comes on two hours later than usual. Or set the clothes dryer to run only when wind power is most abundant.

A lucky few dozen Boulder residents will have even more bells and whistles that include solar panels on the roof, a battery system to store power for emergencies, and hybrid plug-in electric vehicles.

One of those homes is the University of Colorado residence for its chancellor. The home’s six kilowatt solar photovoltaic system feeds into a battery pack that can run the home security system, home office computers, and refrigerator if there’s a power outage. The batteries recharge the plug-in hybrid electric car, and both the batteries and car can pump power into the electric grid if Xcel’s system is strained.

With systems like the ones installed at the university residence, consumers can monitor their electrical consumption, not just over time but also by individual appliance. They can choose different energy use scenarios for when they are on vacation or at home or for different seasons of the year. They can track their carbon emissions and their production of solar energy, and they can see the environmental impact expressed in such understandable terms as number of trees saved or enough energy to microwave 10,000 pizzas.

With a large enough network of plug-in electric cars, Xcel would be able to expand its use of renewable energy—which tends to be intermittent—beyond the 30 percent maximum it now envisions is possible since the cars can serve as a storage system for renewably generated power. Such a network “can be a small power plant for us,” Palmer said. The ability to draw on those small power plants at times of peak demand could mean less need for reserve power and fewer peak generating stations fueled by fossil fuels.

A key test of SmartGridCity will come later this year when Colorado’s Public Utilities Commission takes up a request from Xcel for flexible pricing of electricity, which would give Xcel the ability to charge more during peak hours and less off-peak.

With a flexible pricing system and smart-grid technology installed, customers will have the ability to time their power consumption for when electricity is cheaper. “A customer can decide ‘I don’t want to run my dishwasher when Xcel is burning coal or during peak pricing periods,’” said Kathleen Evens, an Xcel project manager.

Are the benefits of a smart grid worth the costs? Xcel officials believe that with smart-grid technology consumers can cut their energy consumption by 10 percent. And a 2003 study prepared for the Department of Energy using conservative estimates concluded that over a 20-year period there would be $75 billion in benefits from a smart-grid system.

Besides the savings, leaving the grid as it is would entail significant costs: A 2006 study prepared for DOE found that power interruptions alone cost the United States $79 billion a year.

Studies and estimates are one thing; actual real-world results are another. The unfolding experiment in Boulder—a city full of tech-savvy and environmentally conscious residents—should go a long way to showing whether the United States is ready for a major overhaul of its electric system.

Tom Kenworthy is a Senior Fellow at the Center for American Progress. Thanks to CAP Senior Fellow and Colorado climate change coordinator Alice Madden for her assistance.