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Grid Modernization
Industry Trends, Challenges and Solutions
Raleigh, NC
July 26, 2016
© 2016 Quanta Technology LLC
Page 2© 2016 Quanta Technology LLC
Grid Modernization
Grid modernization
“Hands-on” comprehensive portfolio of initiatives focused on
realizing Smart Grid / Grid of the Future vision
Deployment of incremental grid intelligence (technology),
infrastructure (foundational, IT/OT), and engineering processes
Utility of the Future
Long term utility vision adapted to projected business
environment
It covers business, regulatory, grid and customer aspects
Regulatory modernization
Required changes to existing regulatory frameworks to enable
utilities and customers to fully take advantage of opportunities
derived from grid modernization (Utility of the Future enabler)
Page 3© 2016 Quanta Technology LLC
Utility Of The Future Drivers
Need for new electric utility
business models and regulatory
frameworks
Deployment of cost-effective
DG Increasing adoption of
energy management technologies
Deployment of smart grid
technologies, products and
services
Growing adoption of PEVs and
BESS
Deployment of microgrids
Rise of data analytics
Expanded use of utility-scale
renewables
Increasing expectations
regarding resiliency
Customer interest for sustainable
energy options
Increasing expectations for reliability and power
quality
Customer interest for
greater control of energy use
and costs
Growth in energy
products and services
provided to customers by
3rd parties
Importance of cybersecurity
Page 4© 2016 Quanta Technology LLC
Grid Modernization – Key Industry Trends (1)
DER integration
Distributed Generation (DG), energy storage, demand response
Microgrids
Smart Inverters
IEEE 1547 Update
Business Models
Distribution Resources Plan (DRP)
Reforming the Energy Vision (REV)
Rate unbundling (demand charges)
Service diversification and evolving customer expectations
Transactive Energy and future grid architectures
Page 5© 2016 Quanta Technology LLC
Grid Modernization – Key Industry Trends (2)
OT/IT convergence, grid analytics, increased visualization and
real-time operation
Advanced DMS/OMS
DER Management Systems (DERMS)
Distribution Automation (FLISR, VVO)
AMI and advanced sensors (distribution PMU)
Reliability/Resiliency
Physical and cybersecurity
Weather hardening and aging infrastructure
Smart Cities
Page 6© 2016 Quanta Technology LLC
Key Modernization Driver – DER Integration
High penetration of DG (mainly PV) is already a reality in several
utility systems
DG interconnection can have significant and diverse impacts in
numerous business and technical activities of distribution utilities
Source: http://www.hawaiianelectric.com/heco/Clean-Energy/Integration-Tools-
and-Resources/Locational-Value-Maps
Page 7© 2016 Quanta Technology LLC
7
Source: Deutsche Bank
Source: Morgan Stanley
Projected PV prices vs. Utility Rate (Illinois)Levelized Cost of Electricity (LCOE) minus average electricity price in States
When grid parity will be reached is still uncertain and a matter of
debate
Financial institutions like Morgan Stanley, Deutsche Bank and
Barclays have forecasted it will happen in the next decade in many
states of the US
Grid Parity
Page 8© 2016 Quanta Technology LLC
PV distributed generation is experiencing significant growth
Prices continue decreasing despite falling state/utility incentives
Source: Tracking the Sun VII An Historical Summary of the Installed Price of Photovoltaics in the
United States from 1998 to 2013
Grid Parity: PV Prices
Page 9© 2016 Quanta Technology LLC
Grid Parity: Battery Prices
Source: http://homerenergy.com/pdf/RMI_Grid_Defection_Report.pdf
Source: Deutsche Bank, Department of Energy (DOE), Tesla
Historical Battery Prices ($/kWh)
Page 10© 2016 Quanta Technology LLC
Average residential customer monthly bill today approx. $110
(Source: EPRI)
Energy = $70; Distribution = $30, Transmission = $10
Utility model based on kWh sales, but with stagnant (or decreasing
sales due to DER proliferation), rates would go up to pay for needed
grid investments (“utility death spiral”)
Result = Rate fatigue and grid defection (when and if feasible) unless
VALUE demonstrated
Grid/Load Defection
Page 11© 2016 Quanta Technology LLC
• Grid modernization strategy must
address challenges prompted by
grid transformation drivers and
take advantage of emerging
opportunities
• Developing business and
technology roadmaps
• Addressing and preparing
for various scenarios
• Deploying pilot projects to
test and prepare for changes
• Developing and applying
industry standards
• Developing a skilled workforce
Speed and success will depend on clear and balanced
regulatory policies to promote safe, cost-effective, and
reliable deployment of technologies
Grid Modernization Strategy
Page 13© 2016 Quanta Technology LLC
DER – What is the industry doing?
Long-term (focus on business processes, infrastructure
and information systems, and regulatory and policy
aspects):
• Utilities are updating applicable business processes and practices
(e.g., engineering standards, annual planning cycle, load
forecasting) to consider DG integration as an intrinsic component of
their regular activities
• Utilities are upgrading distribution assets, information technology,
communications, and enterprise system infrastructures to gather
and process the data required to operate modern distribution
systems with large penetration levels of DG (e.g., sensor, DA and
PMU deployment)
• Utilities are exploring new concepts to fully take advantage of the
potential benefits of DG proliferation (e.g., microgrids)
• Utilities are participating in industry activities to share experiences,
and are training their engineers to analyze, plan and operate
modern and future distribution systems
Page 14© 2016 Quanta Technology LLC
California – Distribution Resources Plan (DRP)
http://www.cpuc.ca.gov/General.aspx?id=5071
Page 15© 2016 Quanta Technology LLC
Distribution Planning – Hosting Capacity
Source: Results from the DOE-CPUC High Penetration Solar Forum http://energy.gov/eere/solar/downloads/results-doe-cpuc-high-
penetration-solar-forum
Page 16© 2016 Quanta Technology LLC
Power System Criteria – DER Capacity Limits
http://www.cpuc.ca.gov/General.aspx?id=5071
Page 17© 2016 Quanta Technology LLC
Methodology and Calculations
http://www.cpuc.ca.gov/General.aspx?id=5071
Page 18© 2016 Quanta Technology LLC
Examples – Hosting Capacity Maps
Examples (California IOUs):
SCE’s DER Interconnection Maps (DERiM):
on.sce.com/derim
PG&E’s Solar Photovoltaic (PV) and Renewable Auction
Mechanism (RAM) Program Map:
http://www.pge.com/b2b/energysupply/wholesaleelectricsupplier
solicitation/PVRFO/pvmap/
SDG&E’s Distribution System Available Capacity:
http://www.sdge.com/generation-
interconnections/interconnection-information-and-map
Page 19© 2016 Quanta Technology LLC
Locational Value Components (PG&E)
http://www.cpuc.ca.gov/General.aspx?id=5071
Page 20© 2016 Quanta Technology LLC
PG&E Load Forecasting Tool
http://www.cpuc.ca.gov/General.aspx?id=5071
Page 21© 2016 Quanta Technology LLC
How will DG affect load forecasting? Answering this
questions requires considering numerous aspects
Besides traditional uncertainties regarding customer
load growth, additional variables include DG technology,
uncertainty about DG penetration levels, uncertainty
about spatial distribution of DG
Other variables include penetration of additional smart
grid technologies and concepts, e.g., PEVs, demand
response, NZE, energy efficiency, etc
Spatial load forecasting and scenario analysis are good
alternatives to evaluate the individual and joint impact of
these technologies on capacity planning
Load forecasting and Capacity Planning
Page 24© 2016 Quanta Technology LLC
Grid Modernization Initiatives: New Models (DSO)
Source: resnick.caltech.edu/docs/21st.pdf
Page 25© 2016 Quanta Technology LLC
Grid Modernization Initiatives: New Models (DSP)
Market Operations
• Rich information for consumers and suppliers
• Diverse technologies, products and services
• Transparency, flexibility, and efficiency
Grid Operations
• Secure, reliable and resilience
• Flexible and dynamic
• Economical and energy efficient
Integrated System
Planning
• Diverse and distributed energy resources
• Coordination with bulk system
• Integration with market and operations drivers
Market Operations
• Rich information for consumers and suppliers
• Diverse technologies, products and services
• Transparency, flexibility, and efficiency
Grid Operations
• Secure, reliable and resilience
• Flexible and dynamic
• Economical and energy efficient
Integrated System
Planning
• Diverse and distributed energy resources
• Coordination with bulk system
• Integration with market and operations drivers
DistributionSystem
Platform(DSP)
Source: New York State Department of Public Service, WG-2: Platform Technology, July 2014
http://www3.dps.ny.gov/W/PSCWeb.nsf/96f0fec0b45a3c6485257688006a701a/bd6cb06f9ad375
dd85257d0f0053f76e/$FILE/Platform%20Technology%20(Working%20Group%202).pptx
Page 26© 2016 Quanta Technology LLC
Grid Modernization Initiatives: New Models (DSP)
• Fuel and resource diversity• System reliability• Reduced carbon emissions
Gri
d O
per
atio
ns
Mar
ket O
per
atio
ns
ISO DSPP Customers
“Wholesale” Energy and Capacity
“Wholesale” Market Administration
Basic and Value Added Services *
Wide Area View
Bulk Operations(115 kV and above)
“Wholesale” Ancillary Services
“Retail to Wholesale” Aggregation*
Regional/Local View
T/D/Microgrid Ops(115 kV and below)
“Retail” Market Administration
Central Generation Management
DER Management
Direct Access (Individuals)
3rd PartyService Providers
“Premise” View
DER Operations
“Premise” or MicrogridOperations
*Provide or enableSource: New York State Department of Public Service, WG-2: Platform Technology, July 2014
http://www3.dps.ny.gov/W/PSCWeb.nsf/96f0fec0b45a3c6485257688006a701a/bd6cb06f9ad375
dd85257d0f0053f76e/$FILE/Platform%20Technology%20(Working%20Group%202).pptx
Page 27© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: http://energy.gov/sites/prod/files/2014/10/f18/02a-APramaggiore.pdf
Page 28© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: http://energy.gov/sites/prod/files/2014/10/f18/02a-APramaggiore.pdf
Page 29© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: http://energy.gov/sites/prod/files/2014/10/f18/02a-APramaggiore.pdf
Page 30© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: http://library.cee1.org/sites/default/files/library/12421/CEE_Industry_Partners_2015_-_Welcome_to_Chicago_-_Val_R._Jensen.pdf
Page 31© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: http://library.cee1.org/sites/default/files/library/12421/CEE_Industry_Partners_2015_-_Welcome_to_Chicago_-_Val_R._Jensen.pdf
Page 32© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: https://www.cavs.msstate.edu/iPCGRID_Registration/presentations/2015/Svachula_Bahramirad_i-
PCGRID_2015_Microgrid_Deployment_and_Vision.pdf
Page 33© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: https://www.cavs.msstate.edu/iPCGRID_Registration/presentations/2015/Svachula_Bahramirad_i-
PCGRID_2015_Microgrid_Deployment_and_Vision.pdf
Page 34© 2016 Quanta Technology LLC
Utility Initiatives – ComEd (Exelon)
Source: https://www.cavs.msstate.edu/iPCGRID_Registration/presentations/2015/Svachula_Bahramirad_i-
PCGRID_2015_Microgrid_Deployment_and_Vision.pdf
Page 35© 2016 Quanta Technology LLC
DER Integration Trends & Emerging Solutions
IEEE 1547 Update
Smart Inverters
Future design, planning and operation modes of distribution feeders
(closed-loop operation)
Real-time monitoring and control of T&D grids, including ADMS,
DERMS and distribution applications of PMUs
Advanced protection and automation applications, e.g., adaptive
protection, DER-enabled FLISR
Distributed Energy Storage
Microgrids
Power electronics based voltage regulation equipment, distribution
class FACTS devices (FACDS)
Page 37© 2016 Quanta Technology LLC
The Western Electric Industry Leaders (WEIL) Group urged the
Adoption of Smart Inverters on All New Solar Generators
http://www.sdge.com/newsroom/press-releases/2013-08-07/weil-
group-urges-adoption-smart-inverters#sthash.zOs1LNcW.dpuf
Smart Inverters
Page 38© 2016 Quanta Technology LLC
Connect/disconnect
Maximum generation limit
Fixed power factor
Intelligent volt-VAR
Volt-Watt
Frequency-Watt
Watt-power factor
Price or temperature driven
Low/high voltage ride-through
Low/high frequency ride-through
V1, Q1, P1
% A
va
ilab
le V
AR
s
Percent VoltageV2, Q2, P2
V3, Q3, P3
V4, Q4, P4
V = 1.0 PU
Absorb
VARs
Inject
VARs
Smart Inverter Functions
Page 39© 2016 Quanta Technology LLC
Dynamic reactive current support
Real power smoothing
Dynamic volt-watt
Peak power limiting
Load and generation following
DER settings to manage multiple grid configurations
Battery storage:
Direct charge/discharge management
Priced-based charge/discharge
Coordinated charge/discharge
Smart Inverter Functions – cont.
Page 40© 2016 Quanta Technology LLC
A microgrid operates
within a clearly
defined electrical
boundary that can
act as a single
controllable entity
with respect to the
grid and can connect
and disconnect from
the grid to enable it
to operate in both
grid-connected or
island mode
Grid Modernization Initiatives: Microgrids
G
Sub-transmission
Full
Substation
Microgrid
Full Feeder
MicrogridSingle
Customer
Microgrid
Partial
Feeder
Microgrid
Neighbor
Feeder
Distribution
Substation
Secondary
System
Microgrid
G
G
G
G
G
G
Single
Customer
Microgrid
G Normally
Open Tie
Page 41© 2016 Quanta Technology LLC
116 Microgrid projects:
• 81 Operational
• 35 Under development
Regional hotspots:
• California
• Hawaii
• Northeast
Source: GTM Research North American Microgrids 2014: The Evolution of Localized Energy Optimization
Microgrid Landscape (1)
Page 42© 2016 Quanta Technology LLC
Operational Microgrid Capacity = 965 MW
Small scale:
• < 1MW
• Includes part of a feeder, one or more buildings
Medium scale (largest number):
• 1 MW – 10 MW
• Includes an entire feeder
Large scale
• 10 MW – 50 MW and > 50 MW
• Includes several feeders
Source: GTM Research North American Microgrids 2014: The Evolution of Localized Energy Optimization
Top Microgrid States by Capacity (MW) and Installation Number
Microgrid Landscape (2)
Page 43© 2016 Quanta Technology LLC
An iterative study and analysis process
Microgrid Planning Steps
Load Analysis
Analysis of the data to obtain load profiles and identify restrictions
Reliability Analysis
Calculation of reliability parameters for all customers, determination of
customer categories
System Design
Circuit Topology, Operating strategies, Possible cases (base and advanced) for
microgrid development
Generation Mix
Selection of generation: PV, solar, natural gas , wind turbine,
energy storage systems, etc.
Business Case
Detailed development of a business model for potential projects
Controls & Communications
Potential communication architecture and associated requirements
Page 44© 2016 Quanta Technology LLC
Regulatory Challenges:
Ownership of generation
Administrative burden of
regulation
Business Challenges:
DG technologies still costly and with uncertain lifetimes
Business model still undeveloped – how to capture true
revenue?
Technical Challenges:
Bi-directional power flows
Fault current contribution
Unit Level Volt/VAR
support
Islanded Operation
Microgrids challenges
Integration Challenges for Utilities
Page 45© 2016 Quanta Technology LLC
Business Challenges
Cost effectiveness and justifications
Approval & certification processes for introducing new
technologies
Permitting (site & environmental)
Regulatory requirements (state and regional rules)
Lack of guidelines and standard practices
Ownership and governance matters
Integrating in existing DMS/EMS for operation through
control centers
Knowledge transfer and training of personnel
Page 46© 2016 Quanta Technology LLC
Storage as a Game Changer
Challenges:
Safety Concerns
Limited Load Diversity
Limited Grid Benefits
Less Standardization
High Cost
240/120 V69 kV 4 - 34 kV 480 V138 kV345 kV
Distributed(Community)
1-20 MW(Substations)
Storage
Value
Challenges:
Limited Value to Customer
Security & Reliability Risk
Less effective in removing Grid Congestions
High engineering cost (no commodity)
Central Storage Distributed Storage
100s of MW
(central)
Residential
Shipping
Containers
C&I, Microgrids
High accumulated value at
Edge of Grid
Keeping on Utility Side,
rate-basing installs is a key
enabler
Shipping
Containers
Small
Boxes
208 V
Page 47© 2016 Quanta Technology LLC
Grid Modernization Initiatives: Data Analytics
Grid analytics
• Grid analytics is expected to play a key role in grid
operations, asset and outage management, and planning
Source: http://www.accenture.com/microsite/digitally-enabled-grid/Documents/pdf/Accenture-
Grid-Analytics-Report-Digitally-Enabled-Grid-2.pdf
Page 48© 2016 Quanta Technology LLC
Smart Distribution – Real-Time Awareness
Source: http://eetd.lbl.gov/news/article/58572/searching-for-real-time-measure
Page 49© 2016 Quanta Technology LLC
Potential PMU applications in distribution
Source: Toward Micro-synchrophasors (μPMUs) for Distribution Networks
Page 51© 2016 Quanta Technology LLC
Examples of Products
SEL-2431 Voltage Regulator
Control
SEL-751 Feeder Protection
Relay
Page 52© 2016 Quanta Technology LLC
Deployment Example
Substation
3 MW
PV
Auto-Cap
1.8 MVAr
PSAuto-Cap
1.8 MVAr
Auto-Cap
1.2 MVArAdjacent
Feeders
I I
PS
I I
1.5 MW
PV
XX
Auto-Cap
1.2 MVAr
I I
PS
RCS
R
Page 53© 2016 Quanta Technology LLC
Existing Engineering, Operations and Safety Procedures
Power Flow Models
(Synergi)
Historical Data (Load,
Interruptions, Reliability
Indices, etc.)
Root-Cause Analyses
Development of Predictive
Reliability Models
Existing T&D System
Features
Clustering and Representative
Feeder Selection
Simulations & Analysis
Project Prioritization and Expected Improvement
Estimation
Development of Protection
& Distribution Automation
Planning Guidelines
Benefit-Cost Analyses for
Representative Feeders
Existing Communications
Systems & Infrastructure
Selection of Solution Portfolio
Protection & Distribution Automation
Planning Guidelines
Reliability Improvement
Targets
Extrapolation to Feeder Clusters
Automation/Reliability/Protection Convergence
Page 54© 2016 Quanta Technology LLC
Optional steps needed for large scale (e.g., system-wide)
studies:
Clustering and representative feeder selection
Extrapolation to feeder clusters
System aggregation
Automation/Reliability/Protection Convergence
Extrapolation to Feeder Clusters
Overall Cost-Benefit Analyses
System AggregationPreparation of Deployment
Roadmap
Deployment Roadmap
Protection & Distribution Automation
Planning Guidelines
Page 55© 2016 Quanta Technology LLC
Spatial distribution of expected SAIDI before (hr/cust-yr)
SAIDI > SAIDI < Color
0 0.5
0.5 1
1 1.5
1.5 2
2 2.5
2.5 3
3 3.5
3.5 4
4
Examples – Area (SAIDI Before)
Page 56© 2016 Quanta Technology LLC
Spatial distribution of expected SAIDI after (hr/cust-yr)
SAIDI > SAIDI < Color
0 0.5
0.5 1
1 1.5
1.5 2
2 2.5
2.5 3
3 3.5
3.5 4
4
Examples – Area (SAIDI After)
Page 57© 2016 Quanta Technology LLC
Source: http://www.forbes.com/sites/jacobmorgan/2014/09/04/cities-of-the-future-what-do-they-look-like-how-do-we-build-them-and-whats-their-impact/
Grid Modernization Initiatives: Smart Cities
Page 58© 2016 Quanta Technology LLC
Electric utilities are starting to face important challenges in the key
aspects of their business as a result of the ongoing and rapid
transformation of the grid
Addressing these challenges requires a coordinated portfolio of new
and existing solutions that must encompass technology,
infrastructure, regulation, policy and business aspects
Grid modernization strategies and roadmaps allow utilities
proactively address the evolving challenges and opportunities
triggered by grid transformation
Grid modernization strategies and roadmaps need to address a
variety of issues such as foundational infrastructure deployment,
improvement of existing processes and introduction of new
processes, implementation of technologies for incremental grid
intelligence and awareness, and innovation and R&D
Summary
Page 59© 2016 Quanta Technology LLC
1. Utility of the Future Pulse Survey
http://assets.fiercemarkets.com/public/sites/energy/reports/dnvkem
areport.pdf
2. Annual Energy Outlook 2014 With Projections to 2040
3. Commercial Rooftop Revolution http://www.ilsr.org/wp-
content/uploads/2012/12/commercial-solar-grid-parity-report-ILSR-
2012.pdf
4. Solar Parity Map http://www.ilsr.org/projects/solarparitymap/
5. The Economics of Grid Defection: When and Where Distributed
Solar Generation Plus Storage Competes with Traditional Utility
Service
http://homerenergy.com/pdf/RMI_Grid_Defection_Report.pdf
References