Anthony Doesburg: Injection of intelligence promises savings on energy

With the debate about the need for a national broadband network behind us and the contract-letting phase nearing, the discussion is moving on to another kind of network.

Attention is turning to the electricity supply network. One suggestion argues that by giving it an injection of intelligence - turning the creaking national grid into a "smart grid" - we could save 30 per cent of the power the country consumes.

A potential component of the smart grid could be the ultra-fast broadband (UFB) network on which the Government has committed to spending $1.5 billion, and which 18 groups and consortiums are bidding to build.

In fact, says Paul Budde, a key figure in getting a smart grid trial under way in Australia, it would be madness not to use the UFB to make the power grid smarter.

"In Australia we're in the same situation. We're rolling out a national broadband network and we're talking about smart grids, so we have workgroups seeing what the synergies are."

It's estimated Australia would save between A$1 billion ($1.28 billion) and A$2 billion by using a portion of the broadband network to provide two-way communications for a smart grid, Budde says.

Communications capability is just the first step towards a smart grid, by his definition. But it would already unlock significant power savings.

"Knowing what is happening on the grid, you can make it far more efficient and save perhaps 15 per cent of energy - simply by having communications elements on it."

A further 15 per cent could be conserved by attaching in-home displays to the newly installed UFB network in houses, so people could manage their own electricity use.

But it's hard to imagine anyone wanting to do so without an incentive. And how self-management of power use translates into energy savings isn't obvious, either.

Budde explains it like this. Electricity networks have to be engineered for peak loads, which might occur only once or twice a year.

If power companies saw a scorcher of a day coming, they could send a message to customers' display devices offering them a rebate to reset their air-conditioning from 20C to 25C. The customer would pocket a small saving, overall power consumption would be reduced and blackouts averted.

However, electricity lines companies Northpower and Counties Power - both of which are bidding for a slice of UFB action - are sceptical about the level of savings Budde suggests are possible.

"The losses on the electricity distribution network are nowhere near 30 per cent," says Russell Watson, Northpower's network planning manager.

Neil Simmonds, chief executive of Counties Power, puts the figure at less than 6 per cent. He also downplays the significance of UFB for a smart grid.

On the other hand, both concede smarter network monitoring could lead to financial savings for lines companies.

Knowing which transformers were at capacity and which weren't, for instance, could help with investment decisions.

Watson points out another gotcha. A smart grid might alert people to periods when power is cheap, but what if they're not home to get the message and take advantage of it?

That's where smart appliances come in, says Neil Cheyne, general manager of electronic product design at Fisher & Paykel. "The grid, and appliances on it, are going to become very responsive to demand."

With two-way communications, there's the potential not only for appliances to switch on when power is cheap, but for them to signal the grid in advance of turning on so it knows what load to expect and can adjust accordingly.

But Cheyne says there's a lot of work to be done in devising standards to ensure appliances and the grid are talking the same language. "Without standardisation we're going to struggle," he says.

Putting aside disagreement about power savings and the importance of UFB, a summit in Wellington last Tuesday chaired by Budde, where Watson, Simmonds and Cheyne were speakers, shows the concept is on the industry agenda. The clincher is the need for the electricity supply network to be able to cope with pressures that are a response to climate change: for example, distributed generation - homeowners putting solar power back into the grid - and recharging electric vehicles.

A street full of electric cars plugged in at the end of the working day with home heating cranked up and dinner on the stove would fry Counties Power's network, Simmonds says. "There are a lot of opportunities we need to be setting up for."

Smart thinking

Smart grid: A power grid that incorporates digital technology to balance supply and demand. Can include technology such as "smart meters" in homes, and even remote control of appliances, to smooth out consumption.