Manfei He, MEM’19

When I lived with my grandparents in a small town of Southeast China, we used to get those monthly visits from a meter reader of a utility company. They sometimes chatted about families, schools, …and the weather of course. I haven’t seen the meter reader of our neighborhood for who knows how many years. I remembered one day after school, my parents opened a new bank account, saying that all our utility bills would be auto-paid by it.

The changes are tangible at the customer interfaces, although I didn’t know how to summarize those changes back then. And I wouldn’t know I will be sitting in a classroom with many energy professionals of a new generation.

The changing themes and tunes
De-centralized and smart grid is by no means new topics. In 2008, USDOE prepared and published a smart grid introduction ensuing the Energy Independence and Security Act (EISA) of 2007, which characterized the next-generation electrical power system as “smart grid”. In fact, the grid modernization is a continuous and to some extent, self-evolutionary process, however the trendy themes and tunes might be different and constantly updated by disrupted technologies. All happens against a backdrop of more than a decade-old digital economy.

Among the trends and debates of digitalization, there are several commonalities across technologies and sectors.

  • Decentralization
  • Automation
  • And of course, the power of fully utilized data

When roof-top, distributed solar gained popularity in Europe, and soon later in the US, people started to see a clear challenge to the traditional utility model, which was named by an article on Wall Street Journal as “the utility death spiral”. The indispensable utilities were facing the possibilities of loosing their most creditworthy customers to decentralized, off-grid technology (whose advantages were further strengthened by subsidies and improving technology).

The future outlook for utility quickly became more convoluted. Severe air pollution, mounting concerns of climate change and the breakthroughs of battery technologies as well as large-scale renewable generation have impelled the transportation and heating systems to go electric. A report estimated that utility industry profit growth will be boosted to 2% per year by an economy-wide decarbonization and electrification. Yes, a highly electrified transpiration sector is yet to come and require an enormous amount of capital investment, the initial deployment and strategic planning to adapt EV development has become a trendy business among top utilities and power system researchers.

The power flows and the data flows are thusly fundamentally different.  The replacement of meter reader by a smarter meter at my grandparents’ apartment was only a prelude to energy system automation. Renewable energy, demand response resources, and electric vehicles are scattered points of power and information resources that can only be handled by more automatic grid operation system.  An integrated solution powered by high level of data visibility (an IEA guide for energy digitalization and the ubiquity of data connectivity) will play a central role for the evolving grid. The sets of technology that enable this future was summed up by the industry as “Grid edge”, whose market size is said to be US$ 2.4 trillion over the next 10 years.

Long journey ahead

It’s worth noted that there is a fairly long journey ahead of us to transform the largest engineering system, electricity grid, around the globe. New business and research are shaped around some pressing (and intriguing) challenge:

  • how to manage new challenges coming along with new technology (i.e. cyber security)
  • how to manage and stimulate the willingness to change on institutional and also individual level
  • what would be the new business models and customer relationships for the new grid?