Applying Lessons Learned from Telecom to the Smart Grid

The Smart Grid adds, well, “smarts” to the electricity grid.  There are other networks with intelligence in them, such as telecom networks.  What lessons can we learn from them as we create the Smart Grid?  What can we do make sure we end up making the “Energy Internet” instead of inadvertently creating the “Energy Compuserve?”

I had this conversation with Redg Snodgrass, Sr. Director of Digital Media at Alcatel-Lucent and Eliane Fiolet, founder of

The argument against openness of the grid is the requirement for “9 nines” of uptime.  Because electricity is the foundation for everything in our society that’s not transportation, opening it up for innovative new products makes electric utilities nervous.  However, open systems foster new companies and innovation at a scale that close systems tend not to.

Take the break up of AT&T, once the poster child of why you couldn’t innovate on the network.  Back before the breakup, when you could only get two types of phones, the standard one and the Princess phone (both of which you didn’t actually purchase, but that you rented), there was little innovation in modems or other devices that hooked up to the network.  Why?  Because Ma Bell said it was too “dangerous” to allow other devices on the network for the fear that they could disrupt it.  Sound familiar?

While the energy grid is not the telecommunications network, surely there are lessons to be learned from telecom, or network theory in general.  That’s what Snodgrass, Fiolet, and I discussed.

The National Institute of Standards and Technology (NIST) is the in the midst of defining the Smart Grid standards right now.  They’re moving fast, but anyone can participate.


  • March 18, 2010 - 12:06 pm | Permalink


    I applaud your work, as you know. But I must say I found this conversation frustrating due to lack of context. SmartGrid is a simple name for a basket of issues. Without establishing a model and a taxonomy, it is difficult to anchor the problems, fears and recommendations of your speakers. To put it another way, a spirited conversation can occur and there is a reasonable chance the participants are talking about completely different ideas or issues.

    Let’s build a quick example, on the easy side first – the electricity consumption side. There is a regional and local grid, connecting my house and the power plants through a network operated by a transmission and distribution scheme, terminating at the meter on my house. There is a segment of the grid in my house, installed according to the National Electrical Code and local codes. I am relatively free to plug in devices as I wish. I use the ‘relatively free’ qualifier because I generally buy devices that have been certified by people like UL. I am totally free to turn on and off the devices at will. I can accomplish the turning on and off manually or via automation such as timers, programmable devices, computers or even mobile telephones.

    With some information, I can be smart about the business of turning on and off devices. That information can be by proxy, such as looking at the clock and the outside temperature, or can be something I get from the newspaper, TV, radio or the internet.

    My current meter and billing plan is pretty dumb. It only cares how much I use in total and I pay a simple rate through the month. I get rewarded by minimizing the total, but that leaves money on the table in terms of better optimizing the whole system. This is where one version of smartmeter comes in. If there is a means to adjust the rate on the fly, I can change my behavior and be rewarded for it. The meter needs to know enough to record each KWH in the right rate bucket — but that’s about it. I prefer to get supply side signals and price signals from the internet, thank you, and do not want a separate information network. At the next level, demand shaping (where the utility has the right to turn off my a/c or some appliances in return for a reward), I feel the same. That is, the internet will do just fine and I am OK with my a/c having an IP address.

    The production side is more complicated, but not much to start. Yes, a home solar, wind or other generation (or storage) system has to sync with the voltage on the grid, and probably the phase angle. Looking at the NIST workgroups, this seems to be where the standards work resides. There is HUGE opportunity at this level in the hierarchy, and we need to get going at scale. Interface technology at this level is available and we do not have to wait for it to be invented. So long as we are talking about producing ultra-local power on par with the power consumed at the home, this should not present problems or threats to the grid.

    We should have a conversation about whether the current hierarchy needs additional layers — notably a layer for clustered – houses or neighborhood generation systems. Once the economics are right, I predict the biggest issues will be political rather than technical.

    Keep up the good work.

    Don Bain, P.E.

  • Joel Greenberg
    March 18, 2010 - 4:42 pm | Permalink


    Thanks for your thoughts. I think the conversation is converging around the smart meter as the dividing line, or, what we may call it in the future, the Energy Router. It’s the standards based device that knows about all the other devices in the building and provides standards based calls from the energy management system, which houses the local intelligence.

    An interesting case study is from a National Instruments customer who developed a smart system that consisted of sensors and controllers the feed into predective modeling that makes buildings more efficient. Cutting Energy Consumption in the Tropics with NI LabVIEW and Compact FieldPoint. The system not only knows the current state of the building, but the local temp as well as the forecast. Therefore, it can make intelligent decisions about the future state of the building and can take action to get there.

    If the system was IP-based, it could communicate with outside programs like real time reporting on an iPhone, via a web app.

    I need to tease apart your statement, “So long as we are talking about producing ultra-local power on par with the power consumed at the home, this should not present problems or threats to the grid.”

    Technically, distributed generation shouldn’t be a technical threat, but utilities guys I talk to think otherwise. It’s analogy is the Ma Bell network mentality. “You can’t plug that wacky modem into our network because we can’t guarantee security with it on our network.”

    However, what’s even more interesting is that your statement is actually an EXISTENTIAL threat to the grid. Distributed generation at scale scares the tuna out of many utilities because they won’t make the revenue to maintain the wires. Indeed, I had a back of the napkin conversation with a utility friend about just this issue and he figured if people started producing power for their homes in such a way that the utility generated no revenue, then the utility would still have to charge that customer $65/month just to maintain the wires so that they could remain connected to the grid.

    I’d love to dig in deeper about this with you. When are you going to begin attending the NIST meetings? ;)

  • March 19, 2010 - 6:53 am | Permalink

    Thanks Joel. I am game to tease my statement apart a little further. Let’s define the use case as a homeowner and further constrain it to a situation where it becomes attractive to make power at the residence, for consumption at the residence, versus buying it from the grid. Specifically I am talking about netting to zero at the meter, and not selling surplus power to the grid. Let’s further constrain the homeowner power source to be solar PV.

    If I am to put in a grid-connected solar PV system, I need a grid-tie inverter (a device that converts the direct current from the solar panels to the synchronized alternating current that is the grid standard). If you peruse the grid-tie inverters you can buy, you will find that they are certified to UL or CE standards. I have a hard time attributing technical or operational risk to the grid by attaching these certified devices on the home side of the meter especially at the limited sizes practical for a home system ( see below). So I do not understand the cry of impending disaster from this use case.

    Digging a little deeper, my prototypical homeowner used 1,755 kWh of electricity last month for a total of $272.87 billed as $107.06 generation charge, $91.26 distribution charge, $9.65 transmission charge, $60.02 transition charges (this is intangible) and $5.31 customer charge. Turns out 1,755 kWh is a LOT to try to cover with solar. Back of the envelop calculations would say you need over 1500 square feet of panels and $100K investment — not realistic. And of course would still need grid connection because of the mismatch in power production and house demand. So again, I do not understand the sense of panic you are hearing.

    Let’s hypothetically accept the economic threat to the grid you mention — for just a moment. Our homeowner bill above had over $100 in transmission and distribution charges. These are the components for which the protected monopolies are firmly in place. I am 100% confident that the distribution providers know how to get rates approved that fully cover their costs without risk. After all, they got ‘transitional charges’ and ‘customer charges’ approved and those are much harder to rationally explain.

    Retracting the hypothetical above, we really have a different set of problems. We have projected demand growth that is going to be a major challenge to meet, even if we find a way to supply it without burning up the planet. And, the percent-from-renewable power source targets some states have enacted require significant investment. I postulate that it may be more panic-worthy NOT to be getting homeowner systems online and grid-tied as soon as possible. We need to get busy building this stuff and the utility companies should be actively encouraging it.

    Don Bain, P.E.

    BTW, the $65 per month your utility friend said for maintaining the local/regional grid fits with the charges above. 1,755 kWh is higher than average.

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