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Third-World Grid, SmartGrid or a Smart Grid?

June 25, 2018
Wholesale adoption of smart grid technologies across broad swaths of the industry without cost and benefit evaluations will not often be necessary

Many articles have been written recently complaining that the United States has a third-world electricity supply system.  Other articles, perhaps with a less disparaging tone, express the desire that the U.S. grid should become a “SmartGrid.”  Some advocate governmental or other unified action to support/require SmartGrid advancements.  Do we need a centralized source implementing major changes with regard to the planning, expansion, enhancement and financing of the U.S. grids in order to develop the smart grid?  Or are the utilities that comprise each of the three major grids within the United States  doing an adequate job in balancing economics and reliability in order to provide safe, dependable and affordable electricity for their customers? 

What is a Smart Grid?

A definition of a smart grid was first provided by the Energy Independence and Security Act of 2007.  The act enumerated 10 components with the underlying theme that digital processing and two-way communication with the resulting data flow and information management are what make the grid smart.  The 10 components incorporate all elements of a power system including load, distribution, transmission and generation and are associated with the use of renewables, demand-side management, energy storage, peak energy shaving, and power conditioning.  The system is considered smart because of the communication technologies that enable self-healing through sensing capability with heavy monitoring, and a variety of computer controls that when combined provide automatic system responses for changes in load, generation and equipment that is out of service for whatever reason. 

Transmission v. Distribution Grids

Our focus herein is on the “backbone” networked high-voltage transmission system.  The transmission system takes power from generation resources and delivers it to distribution substations that are generally located close to the ultimate customer.  In the United States, there are three grids – the Eastern Interconnection, the Western interconnection, and ERCOT (Texas).  Each utility system also has a lower voltage distribution system that takes power from the distribution substations to the end-use consumers. 

Most of the outages that we as electricity customers experience are outages that occur on the distribution system – for example, when a car hits a distribution pole or a squirrel attacks a piece of equipment or a pole transformer is damaged during an ice storm. These outages are much less severe, although they are much more frequent, than outages that occur on the transmission system.  It is easier to restore power and recover from distribution outages.  Large scale bulk (transmission) system outages, although very rare, can result in long-term large area blackouts with significant cost consequences.  Even in the case of a major blackout, however, recovery of the system generally proceeds in an orderly, efficient manner. 

Like the transmission system, distribution systems may employ smart grid technology.  The degree of technical sophistication or “smartness” of particular distribution systems is generally determined by the utility that owns that system, which means it is determined locally with decision factors determined locally as well.  In some areas of the country, high reliability may take a strong preference over cost.  In others, cost is the primary decision factor.  The needs and capabilities of individual areas are taken into consideration when balancing economics and reliability across a distribution system.  Because smart grid technologies on the distribution system result from local decisions and customers are not the focus of smart grids, we turn our attention to the high-voltage transmission system. 

Current Grid is Smart

The current U.S. transmission grids as they have developed and matured over the past 100+ years already employ many conventional technologies that make the grids safe, highly robust, redundant and, arguably, smart. In fact, our transmission grids are considered a complex and sophisticated engineering marvel. 

An example of a conventional technology used to ensure the reliability of the transmission system is system protection.  High-voltage transmission systems are susceptible to failure when struck by tornadoes, trees and animals.  Modern relays sense problems (faults) in fractions of a second and separate the impacted system elements from operation – and from the system and its other elements.  This protects the equipment and usually, dependent on the degree of severity (think hurricane or tornado), keeps the system operating.  Three zones of protection are standard engineering practice.  These three zones of protection mean that over 99.9% of the time, no ramifications result on the larger system as the relays operate as intended and remove the fault from the system.  Other conventional technologies that make the grid “smart” include, but are not limited to, automatic reclosers, frequency control, load balancing, Automated Generation Control, and Area Control Error.

An extreme example of the vulnerabilities as well as the strength of the current grid is the 2014 attack on the Metcalf substation in California.  After cutting the communications technology at the substation, a team of snipers hit equipment in the substation with over 100 rounds of ammunition from high-powered assault rifles.  Although the damage toll to equipment was over $15 million, due to the redundancy and resiliency of the transmission grid, not a single customer lost power. 

Needs Driving a Smart Grid

Emerging concerns that are driving the perceived need for a smart grid include such low-probability, high-impact events as electromagnetic pulses (EMP), terrorism and cybercrime as well as the need to make the grid friendlier for green power.  Each of these factors raises different issues and concerns for the safe and reliable operation of the transmission grids. 

The concerns around high altitude EMPs have evolved as more information has become available and studied.  Early studies estimated that high altitude nuclear explosions would be expected to black out the entire U.S. with long-term damage to hundreds of high voltage transmission transformers.  More recent studies project more regional outages with much fewer transmission transformers affected.  To some extent, these revised projections reflect that the transmission grids are more capable and resilient than anticipated. 

Redundancy may be as effective a tool as there is in facing terrorism.  Certainly, the attack on the Metcalf substation demonstrated the significant benefits of redundancy.  A smart grid will have additional capabilities to respond to terrorism that will serve to enhance the redundancies already inherent in the transmission grid design. 

Cybercrime poses special challenges for smart grid technology.  By its very nature, a smart grid means that significant digital processing and two-way communication equipment are integrated into the system and its operation.  This makes the system more vulnerable to cybercrime and hacking.  Although conventional electromechanical relays and breakers are more limited in performance and control than modern digital control systems, these conventional pieces of equipment are also much less vulnerable to hackers.  The smart grid, thus, is not a solution to cybercrime, but rather an approach that will continue to be challenged by the escalating battle between increasingly sophisticated security capabilities and the relentlessly increasing skills employed by hackers.

Generally the forms of green power that would benefit from smart grid advancement are solar and wind.  Because these two forms of electric generation do not rotate in synchronism with the power system, as do more conventional forms of generation such as hydro, nuclear, biomass and fossil fuel, they don’t as readily provide system support in categories known as essential reliability services.  A grid with extensive investment in infrastructure may have less of a need for certain essential reliability services, thus making it easier to provide for wind and solar expansion.  However, it is generally more economic to provide the system support services required for wind and solar as the resources are actually developed rather than to build all of the possibly needed infrastructure in advance (so-called overbuilding) so that wind and solar energy resources can be accommodated easily whenever they happen to show up.  Although some renewable energy supporters advocate for such overbuilding, the authors believe that overbuilding is too expensive and that improvements need to be targeted for the actual resources as they materialize in order to keep electricity prices reasonable for the average consumer. 

Limits to the Smart Grid

Electric utilities have often in the past been referred to as late adopters – not adopting technology until it is proven.  That caution comes from experience – new technologies don’t always work the first time and job number one at an electric utility is to “Keep the Lights On.”  Let’s just look at one example of new technology adoption that did not work out so well.

An advanced protection scheme, specifically put in place to avoid outages, caused an outage literally broadcast around the world – the Mercedes-Benz Superdome went black during the 2013 Super Bowl.  An advanced protection scheme, with its associated higher complexity, came with added risk.  Unfortunately, the system failed. 

Utilities can spend money in two primary areas when working to improve system reliability.  The first is highly reliable components and the second is in providing redundancy.  A balancing of reasonably reliable components with redundancy is the best strategy.  Most utilities in the U.S. have achieved a good balance between employing smart grid technology and utilizing redundancy to provide a reliable electricity supply.  This is true even for parts of the grid that have old and outdated infrastructure.  For those areas, redundancy provides the necessary cushion required for the older infrastructure with its increased probability of outage.  As an example, three older transmission lines that each suffer periodic outages but where each is capable of carrying the entire load of all three lines provides for superior reliability versus relying on one path with state-of-the art technology which causes an outage whenever that low probability event occurs. 

Yes, U.S. utilities need to add new modern equipment, but it makes sense in many cases to continue to use the old aging infrastructure to provide redundancy.  Furthermore, systems may be put at undue risk if they operate under the mindset that any loss of load is unacceptable.  The long-standing philosophy is that it can be acceptable to drop some load in order to preserve the entire system.  When a system is stressed, temporarily dropping a small portion of the load can be very helpful in allowing the system to regain stable operation.  Smart grid systems that greatly limit the potential of all outages should be examined to make sure they do not present a small but unacceptable risk of their operations bringing the entire system down. 

Comparing a Smart Grid to a Smart Home

Many members of the public equate smart homes and smart grids.  Certainly, there are differences, but smart home technologies can be integrated with smart grid technologies.  In addition, there are many similarities in the decision making process a homeowner will make for a smart house and the utilities will make for the smart grid.  What makes one’s home smart?  These technologies include thermostats, music, entertainment, lighting, energy control, and security. 

Individuals in their homes will balance cost and benefits just as the electric industry will balance reliability, economics and public responsibility.  At this time, it does not make sense for most homeowners to purchase every high tech gadget, bell and whistle regardless of the costs involved.  Similarly it does not make sense for utilities to employ all potential “smart” technologies widely across the power grid.


Our current transmission grids already have smart elements as well as conventional technologies.  New technology should be and will continue to be used to address risks to the grid and to provide for certain generation resources.  These risks include EMP, terrorism and cybercrime.  Certainly, enhanced protection is warranted in many places, increased security measures must be added, and grid automation can provide benefits in many cases.  However, wholesale adoption of smart grid technologies across broad swaths of the industry without cost and benefit evaluations will not often be necessary and individual applications will need to be carefully justified.  Centralized generic efforts to transition to a smart grid are not, in the authors’ opinions, justified at this time. 

Installing advanced capabilities earlier than warranted, such as to accommodate not-as-yet-built renewable resources increases cost without commensurate benefits.  Our current grids are smart and balance the reliability and economic needs imposed upon them.  Although different regions and areas apply smart technology in different ways, each are likely using appropriate degrees of technology consistent with reliability, economics and public responsibility for their systems. 

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