‘Necessity’ Will Drive Overhaul of Nation’s Smart Grids, Energy Summit Told

Carvallo said the U.S. electrical grid hasn’t been overhauled because it hasn’t had to be, but emerging technologies including electric vehicles will stress the system. A challenge for utilities will be how to manage a decentralized two-way power flow with “control on the edge, not at the center,” and still have a harmonious power distribution system with all customers served comfortably. “How do you bring into the cycle a 20-kilowatt system on the edge within two minutes when the system and the standards haven’t been designed to do that?” Carvallo said. “You have to redesign the whole thing, and that’s what’s happening."

Electric vehicles with hefty power draws and solar panels with distributed generation “will trump what’s going on,” Carvallo said, because “necessity is the mother of all invention. As soon as 10,000 or 30,000 Nissan Leafs show up in Sausalito or Austin, utilities there will have to re-do everything,” he said. “It’s coming.” The tipping point for grid redesign isn’t hundreds of thousands of electric vehicles, Carvallo said. “It’s homeowners sharing a transformer with their neighbors.” An energy-conscious home may consume 20 kilowatts of energy on a daily basis, he said. “If you plug in an electric vehicle with a 20-kilowatt battery in it and have four or five of your neighbors doing the same, and you're not coordinating charging, you just doubled the load on that transformer."

Solar panels will also drive the need for a utility grid redesign, Carvallo noted. He said there are approximately 1,000 solar rooftops in the Austin area, about 30,000 in northern California and some 50,000 in southern California, all capable of generating more electricity than a home needs. “Generation used to only happen on the utility side,” he said, but now generation can happen “anywhere on the grid.” The utility is the ultimate owner of the grid, he said, and can adopt an eBay-style model to allow consumers to sell their own generated energy to other users. Or, they could send their excess homegrown electricity to friends and family. Since the utility is the ultimate owner of the grid, “they can control the flow upstream, downstream and sideways,” he said.

The current electricity infrastructure doesn’t have the security required to protect the network, Carvallo said. He compared that with the complex security built into every smartphone, a device he called “the most sophisticated device ever built that also includes strong security protection.” None of the “edge devices” on the smart grid have comparable security built-in, he said. If consumers swapped meters with a neighbor, “the utility would not have a clue, and that is true for every single device on the grid,” he said.

In a chart outlining the smart home of the future, Carvallo identified the smart meter, intelligent sockets, appliances, the electric car, a home dashboard or gateway, smart plugs, solar panels, wireless connections and energy storage solutions. How consumers will purchase these devices -- whether from a Best Buy or the utility -- and whether they'll be standalone systems or modular systems that can be added to incrementally, and whether they can communicate with utility company programs, are all issues that have to be worked out. “How do you create the concept of smart interoperability where smart light bulbs from Philips, plugs from GE, electrical equipment from Siemens and the in-home display from Cisco [all work together]?” he asked.

Carvallo claimed his company’s Grid Net utility operating system solves the issue of interoperability while meeting all the required standards. “The difficulty with that is that different companies have different religious beliefs about different standards,” he said. An operating system for the grid would allow all the components of the grid to talk to each other via a control layer that connects all the points in the chain, he said.

Getting to that point is the hard part. We asked Carvallo how the various companies in the energy chain will be incentivized to adopt a common platform when Panasonic and Sony, for example, don’t even want their products to communicate in a home theater setup. “The benefits come with manufacturers living in an ecosystem that’s rewarded by the utility or the powers of energy management,” he said, which in turn theoretically accelerates adoption of the technology. “A Samsung is only going to do it if they're going to sell more devices,” he said, and that will happen if the ecosystem creates a value that consumers understand. Consumers given the option of two choices at retail, with the second option being one with green incentives that costs 10 percent more, will choose the latter, he predicted.

Signs of the emerging ecosystem are there, Carvallo said. By 2015, “a lot of homes will go automated” and there will be a significant adoption of solar panels and distributed generation, he said. Most significant will be the number of commercial buildings that have been automated, he said, projecting 50 percent penetration by 2015. “The big push in adoption trends always starts on the enterprise level,” he said. “It will be the big companies making big moves that will create the volume needed to push the cost reductions needed for the residential wave to come.” Asserting that the “genie is already out of the bottle,” he said the number of building management solutions is “way ahead of residential.” By 2015-2020, “we should be in a totally different world in terms of how we think about energy and manage energy,” he said.