Distribution networks in today’s utilities play passive roles as their function is limited to receiving electric power from transmission networks and delivering it to the loads (customers). Thus, the power flow in the distribution network is mostly unidirectional. The infrastructure of the current distribution networks, their protection and monitoring devices, as well as their control systems are all designed to operate in this passive environment. However, because renewable energy and distributed generation systems are often connected directly to the distribution networks, the network must be redesigned to allow for more vibrant bidirectional operations and control environments. One of the concepts for the future distribution network infrastructure is called the “Smart Grid”.

“The Smart Grid” is the vision for future distribution networks that utilize newer and different technologies to allow for the integration of renewable energy systems and distributed generation systems into the distribution network. The concept of the smart grid was conceived at the end of the twentieth century by European and American researchers. It is an ambitious structure that embeds conventional and renewable energy generators, energy storage systems, demand-side management, wide-area monitoring, and intelligent control.

Renewable energy systems are connected directly to the distribution network. Renewable resources such as hydrogen have their own infrastructure to power loads and fuel cell vehicles. This requires safe and efficient storage systems for the hydrogen as well as underground pipe systems to transmit the gas. When the demand for electrical energy is low, renewable resources can be used to generate hydrogen through, for example, electrolysis processes. Surplus electric energy can be stored in, for example, supercapacitors for long periods with minimum losses. In addition, thermal storage can be used to directly heat buildings. This could be a simple system where rocks are heated when electricity is cheap or abundant. The heat is then extracted when electricity is expensive. The customers can also have their equipment controlled by the utility where at peak demands, the unessential loads are disconnected. In this way, customers receive lower energy bills while the utility manages its resources much better. To optimize the operation of the smart grid, local and network information is collected and transmitted to a central control system where sophisticated algorithms operate the network efficiently and reliably at all times. As described by the visionaries, the smart grid has four major objectives:

1. Improve accessibility by granting access to all customers and allow bidirectional power flow to renewable resources.
2. Increase system flexibility by implementing technologies that respond to customers’ needs while responding to changes and challenges in the grid.
3. Enhance system reliability by assuring the energy supplies and enhance system security.
4. Reduce the cost of energy by providing the best values to the customers through innovation and efficient energy management.

Advantages of smart grid

The smart grid can provide tremendous benefits to the power grid and energy customers, as follows:

1. Reduction in transmission congestion

When renewable generation is located near load centers, the generated power can be consumed locally instead of hauling it from large power plants through transmission lines. This reduces the currents in the transmission lines, thus allowing for extra customers to be connected to the existing line instead of constructing new ones.

2. Reduced blackouts and forced outages

The Department of Energy estimated that the “power outages and fluctuations cost US businesses and consumers $30 billion each year”.

The main cause for the outages is when the demand and generation are not equal, either because of inadequate generation or the lack of available transmission lines that can haul power to the customers. If more renewable generations are present near load centers, there is less dependency on generation from large utilities and less dependency on transmission lines.

3. Self-diagnosis

The power system is extensively monitored, but the measurements do not cover the entire grid and the overwhelming data is extremely hard to process at the national grid level. The improvements in the capabilities of monitoring devices and their data communications as well as their data security will allow algorithms to better monitor the power grid and predict problems ahead of time. When problems occur, the system can quickly identify the source and location of the problems.

4. Self-healing

With better monitoring systems and with more automation in power grids, it is possible for the grid to automatically reconfigure its network to restore power quickly. The self-healing feature of the smart grid includes the intelligence to ensure the safety of grid workers and the general public. Improved monitoring and decision support systems will quickly identify problems and hazards. The ability to identify equipment that is on the verge of failure is certain to save lives and reduce severe injuries.

5. Reduction in restoration time

With self-healing, the grid can restore itself automatically instead of manually restoration. The smart grid will perform continuous self-assessments to detect, analyze, respond to, and as needed, restore grid components or network sections.

6. Peak demand shaving

Utilities purchase energy during peak times from other utilities. The cost of this energy is part of the rate structure of customers’ bills. If technologies are developed to allow for customers to reduce their demands during these times without inconveniencing them, this can potentially save costs to utilities and customers.

7. Increased system capacity

When generation resources and transmission lines are less used, the capacity of the grid increases. Thus, more customers and more demands can be added without elaborate expansion of the infrastructure.

8. Increased power system security and reduced vulnerability

With local generation and less dependency on transmission infrastructure, the system security is improved. The loss of a transmission line feeding an area with a local generation will have a lesser impact than the case without a local generation.

9. Efficient usage of hybrid and electric vehicles

If electric vehicle (EV) penetration is high enough, it could cause a stability problem as a large number of vehicles could be plugged into the power grid after people arrive from work between 5 and 7 pm. This is because the load could rapidly increase beyond system limits. Adjustable charging techniques can address this problem.

10. Environmental benefits

Reduced losses enabled by a smart grid will enable delivery companies to reduce the amount of generation (and hence emissions) needed to serve a given load. Similarly, consumers will be equipped and motivated to more effectively conserve energy, again reducing the amount of generation and emission. And with increased knowledge of the smart grid’s state, advanced storage,

and new control devices, system operators will be able to integrate additional intermittent renewable generation beyond what can be done with today’s grid.

11. Market empowerment

A smart grid involves consumers by engaging them as active participants in the electricity market. It will help empower utilities to match evolving consumer expectations and deliver greater visibility and choice in energy purchasing. It will generate demand, for cost-saving and energy-saving products. Smart grids will help educate the average consumer, foster innovation in new energy management services and reduce the costs and environmental impact of the delivery of electricity.