Smart Grid

Smart grid history

To understand the smart grid, you need to first understand “the grid.” The grid, sometimes referred to as “the largest machine in the world,” refers to the massive network of transmission lines, substations, distribution lines, transformers, and other assets and technologies that deliver electricity from the power plant to your home or business. As a society, we’ve relied on the grid for more than 130 years to power our daily lives.

Present-day use of the grid encompasses how we work, communicate, socialize, and learn, and especially our prolific use of digital technology. With the increasing adoption of electric vehicles, the grid is increasingly being used for transport. Yet, as our uses and needs have evolved, our maintenance of, and investment in, the grid have not kept pace. We are now stretching beyond the grid’s ability to meet our needs. Not only is the system becoming more and more susceptible to blackouts, but outages also cost our economy tens of billions of dollars annually. Grid reliability issues also put our national security and public safety at risk.

Like the internet, the smart grid is evolving to include advanced sensing, intelligent controls, distributed computing, automation, and new technologies and equipment that work together to meet our electric demands. (Image: Pacific Northwest National Laboratory)

As a result, the energy industry is undergoing sweeping changes. This includes utilities and energy providers meeting the quickly evolving expectations of customers. Consumers are not only looking to save money but are also wanting to manage their own end use and generate their own clean energy. Transitioning to a more robust, flexible, and resilient grid is the long-term challenge. Enter the “smart grid.”

Our introduction to the 21st century was defined by technology advances that increase connectivity and create value from data, the kind of advances that lend themselves to addressing the limitations and costs of our antiquated electrical grid. Emerging digital technology is being applied to communications between the utility and its customers. It’s also being used to “sense” problems on the grid itself. These are some of the technological characteristics that make the transforming grid “smart.” Like the internet, the smart grid is evolving to include advanced sensing, intelligent controls, distributed computing, automation, and new technologies and equipment that work together to meet our demands for electricity.

Smart grid timeline

As for the people who are responsible for the grid, they are an ecosystem of asset owners, grid operators, utilities, manufacturers, service providers, and government officials at federal, state, and local levels. Oversight for nationwide transmission or the “bulk power system” occurs through the Federal Energy Regulatory Commission. This commission, in turn, legally enforces the standards for electric grid reliability put forth by the North American Electric Reliability Corporation. Relative to grid policy, the U.S. Department of Energy (DOE) is the federal, cabinet-level department developing and executing energy policy and managing federal energy funding appropriated by Congress. Regulation of larger, investor-owned utilities takes place at the state level through public utility commissions, while smaller utilities such as cooperatives and “munis” are governed by member owners or local officials. Together, all these industry stakeholders contribute to funding, building, operating, and regulating the modern-day grid that society depends on for comfort and convenience, economic prosperity, and public safety.

Though the power grid has been incorporating new technologies for decades, the smart grid was first defined, in an energy policy sense, in 2007, when the U.S. Congress passed the Energy Independence and Security Act of 2007. The bill states, in part, the country’s support for “the modernization of the nation’s electricity transmission and distribution system to maintain a reliable and secure electricity infrastructure that can meet future demand growth.” Fundamental to this description are 10 characteristics, ranging from increased use of technology to improve grid reliability, security, and efficiency, to providing consumers with timely information and control options, to integration of renewable resources.

Many definitions of the smart grid followed the one set forth in the bill, but all are similar in their inclusion of digital technology and communications that enable a two-way path connecting the customer, the grid, and the utility.

Utilities are now actively working to improve grid infrastructure, overlaying digital technology and overhauling their work processes to capitalize on their investments in the smart grid. They are poised to make the transformation from a centralized, producer-controlled network to one that is more distributed and more consumer-interactive. The move to a smarter grid promises to change the industry’s relationship with customers. It will also enable consumers to tailor their own energy consumption (and distributed generation) based on individual preferences, like price and/or environmental concerns.

Applying the smart grid

An automated, widely distributed energy delivery network, the smart grid is capable of monitoring everything from power plants to customer preferences and everything in between. It incorporates into the grid the benefits of distributed computing and communications to deliver real-time information and enable the near-instantaneous balance of supply and demand by providing the capability to manage at the device level.

A smarter grid is a necessity for the future. Take for instance electric vehicles. Enabled by the smart grid, these vehicles will number in the tens of millions by the end of this decade. Additionally, when light electric vehicles (i.e., cars and small trucks) are recharged at night, power plants are better able to meet U.S. electricity needs during times of peak demand in the day. The integrated communications control infrastructure inherent to the smart grid makes handling the load of electric vehicles simple and efficient.

There are numerous other innovative advancements that are dependent on the smart grid. Grid interactive zero-net commercial buildings, equipped with smart grid technologies, help balance energy generation and conservation while helping ensure grid stability. Superconducting power cables reduce line losses and carry exponentially more power. Powered by the smart grid, advanced sensors can monitor and report line conditions in real-time, enabling more power to flow over existing lines and making the grid more efficient.  

It’s always been costly and challenging to store electricity at grid-scale but that’s changing quickly. New, long-duration, grid-scale energy storage technologies are being developed (including a new generation of batteries) that can meet the performance and cost requirements for more wide-scale deployment. Energy storage, intelligently controlled through the smart grid, will be critical to bringing more renewable energy resources—such as solar and wind—onto the grid.

Smart grid benefits, strengths

According to DOE, the smart grid is:

  • Intelligent – capable of sensing system overloads and rerouting power to prevent or minimize a potential outage; capable of working autonomously when conditions require resolution faster than humans can respond…and cooperatively in aligning the goals of utilities, consumers, and regulators
  • Efficient – capable of meeting increased consumer demand without adding infrastructure
  • Accommodating – capable of accepting energy from virtually any fuel source, including solar and wind, as easily and transparently as coal and natural gas; capable of integrating any and all better ideas and technologies—energy storage technologies, for example—as they are market-proven and ready to come online
  • Motivating – enabling real-time communication between the consumer and utility so consumers can tailor their energy consumption based on individual preferences, like price and/or environmental concerns
  • Opportunistic – creating new opportunities and markets by means of its ability to capitalize on plug-and-play innovation wherever and whenever appropriate
  • Quality-focused – capable of delivering the power quality necessary—free of sags, spikes, disturbances, and interruptions—to power our increasingly digital economy and the data centers, computers, and electronics necessary to make it run
  • Resilient – increasingly resistant to attack and natural disasters and extreme weather events as it becomes more decentralized and reinforced with smart grid security protocols
  • Environment-Friendly – slowing the advance of global climate change and offering a genuine path toward significant decarbonization and environmental improvement.

The value of the smart grid for consumers

With the smart grid, customers can see how much they are paying for energy before they use it, which is a powerful motivator for reducing the use of electricity during peak periods. (Image by Marvin Samuel Tolentino Pineda |

The smart grid connects customers to the grid in a way that is beneficial to the customer and to the grid. Simply by connecting to consumers—by means of price signals and smart appliances, for example—a smarter grid can reduce the need for new infrastructure, while keeping electricity reliable and affordable.

During episodes of peak demand, stress on the grid threatens its reliability and raises the possibility of outages. By enabling consumers to automatically reduce demand for brief periods through new technologies and motivating mechanisms like real-time pricing, the grid remains reliable—and consumers are compensated for their help.

Enabling consumer participation also provides tangible results for utilities as they look to finance new transmission lines or build new power plants. The smart grid enables utilities to partner with consumers to manage the demand side of the energy equation to help minimize the need for costly new infrastructure.

Think about it, in market after market, from transportation to retail, consumers are advocating for choice and a customer-centered user experience. With the right technology and program in place, many customers will also seek insight and visibility into the energy choices they make. With the smart grid, customers can see how much they are paying for energy before they use it, which is a powerful motivator for reducing the  use of electricity during peak periods.

Given new awareness, understanding, tools, and education made possible by a smarter grid, consumers will be able to make choices that save money, reduce carbon emissions, and help maintain grid reliability.

Smart grid supports decarbonization

While the nation’s transportation sector emits a good portion of the carbon dioxide we produce, the generation of electricity emits up to twice as much. This presents an enormous challenge for the electric power industry in combating global climate change. Smart grid deployment is a key tool in addressing the challenges of decarbonization and has the potential to significantly reduce greenhouse gases and criteria pollutants. For the growing number of environmentally aware consumers, a smarter grid finally provides a “window” for them to understand and empower their personal environmental impacts.

Smart grid future

Continued technical innovation and investment in the smart grid remain critical to its adoption. Historically, momentum for these actions has been fueled by research.

After World War II, the U.S. government initiated an immense investment in scientific research. It resulted in the formation of DOE’s 17 National Labs, which have served as the leading institutions for scientific innovation, including grid modernization, in the United States for more than 70 years.

The labs tackle the critical scientific challenges related to energy reliability and sustainability and possess unique capabilities and facilities. They address large-scale, complex research and development challenges facing the nation with a multidisciplinary approach that places an emphasis on translating basic science to innovation.

Pacific Northwest National Laboratory and the Smart Grid

The Electricity Infrastructure Operations Center (EIOC), located in PNNL’s Systems Engineering Building, includes two fully functional grid control rooms. The rooms—designed with input from utilities, technology companies, and researchers across the nation—each feature 452 square-foot video walls that make it possible to design, test, and evaluate tools and concepts in a setting that mirrors current industry conditions. (Photo: Pacific Northwest National Laboratory)

Pacific Northwest National Laboratory (PNNL), headquartered in Washington State, is one of DOE’s 17 National Labs. PNNL is delivering the science, technology, and leadership to transform our nation's aging power grid into one that is clean, efficient, reliable, and resilient. Focused on the vital needs of the energy infrastructure, we are taking a system-wide approach to grid modernization to help realize the "smart grid" of tomorrow—where energy technology meets digital technology through a network architecture encompassing the full energy value chain from power plant to consumer.

We work in the following areas:

  • new grid architectures to support decarbonization, resilience, and security
  • scalable transactive control to manage energy demand
  • grid cyber situational awareness and response
  • artificial intelligence and machine learning for real-time sensing, analytics, and control
  • high-resolution real-time tools and grid data sets to validate new technologies
  • next-generation grid-scale energy storage technologies.

The power grid plays a central role in our nation’s economic prosperity and national security, while providing comfort, convenience, and safety to 330 million Americans. But the power grid must be transformed to meet the challenges of a rapidly changing energy landscape. PNNL is committed to being the national leader in research and development to help the nation build a cleaner, more resilient, and secure power grid.


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