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Building New American Prosperity through Smarter and More Secure Infrastructure

By Dr. Massoud Amin

Have you ever been in a village without electricity? Or have you been in a major city during a blackout?

In the early- to mid-1960s I visited villages outside of Tabriz and Tehran in Iran and witnessed families scratching out a subsistence living, farming plots of earth so parched they cracked under the searing sun, suffering from low life expectancy (life expectancy was in low 40s). Then in mid to late 1960s electricity reached these small villages. With new wells, pumps, and irrigation, barren soil bloomed into green cropland. Life stabilized, the population grew, and better schools and medical facilities followed. More babies survived and grew into children, and more of those children received a better education. A tractor parts factory and other businesses came to the area, providing a more stable and diverse economy.

Electricity is the linchpin: This critical infrastructure constitutes the fundamental infrastructure of modern society. But that pin, upon which the stability and security of modern life depends, is too often taken for granted and considering the increasing demands society is placing upon it.

On 13 July 1977, I was a 16-year-old high school student visiting NYC when lightning triggered a 24-hour blackout that cut power to nine million. I experienced the chaotic blackout with looters smashing their way into an electronics stores. There were fires, looting, and nearly 3,800 arrests, but also many stories of neighbors helping one another. I saw a system that needed to be saved, and that system dealt with the human condition.

Not only in developing parts of the world that I had witnessed in the 1960s, but even more so in the advanced societies, our economy and quality of life depends on reliable and disturbance-free electricity and other life-line critical infrastructures that we often take for granted.

Nearly 35 years later, we continue to operate the most advanced economy in the world primarily with 1960s and 70s technology. While blackouts and water main breaks aren't national tragedies, in the long run, they will be costly to our nation's prosperity. Power outages and power quality disturbances cost the U.S. economy over $80 billion and up to $188 billion annually.

Starting in 1995, the amortization/ depreciation rate exceeded utility construction expenditures. Since that crossover point in 1995, utility construction expenditures have lagged behind asset depreciation. This has resulted in a mode of operation of the system that is analogous to harvesting more rapidly than planting replacement seeds. As a result of these diminished "shock absorbers," the electric grid is becoming increasingly stressed, and whether the carrying capacity or safety margin will exist to support anticipated demand is in question.

The electricity grid faces (at least) three looming challenges: its organization, its technical ability to meet 10-25 year and 50 year electricity needs, and its ability to increase its efficiency without diminishing its reliability and security with adequate shock absorbers and smarter infrastructure to enable a resilient system which adaptively reconfigures and preserves its capacity.

Infrastructure investment isn't limited to building new roads and filling potholes, it also includes the "invisible" infrastructures that Americans rely on. It is easy to forget about these linchpins of our daily lives — that is, until the power goes out or your phone line is dead during an emergency. We must build a bridge to a 21st century economy supported by smarter, more secure and high-quality infrastructure.

The electrical power grid system has been hailed by the National Academy of Engineering as the 20th century's most influential engineering innovation of our civilization. Even so, American progress with the electrical power grid has stalled. Power outages cost Americans anywhere from $80-188 billion each year and, excluding extreme weather and disasters, on average last 92 minutes a year in the Midwest and 214 minutes in the Northeast.

Japan averages only 4 minutes of power outages each year.

We've wasted 10 years arguing the roles of the public and private sectors while our global competitors adapt and innovate.  Now is the time to gain speed in infrastructure investments.  We need to renew public/private partnerships, cut red tape and reduce the cloud of uncertainty on the return on investment in infrastructure modernization and upgrades.  In addition the electric power sector is second from the bottom of all major U.S. industries in terms of R&D spending as a percentage of revenue, exceeding only pulp and paper. The pet food industry, hotel industry and the insurance industry each invests in R&D at a higher rate than electrical power. To upgrade our nation's invisible infrastructure, the federal government must demonstrate a prolonged commitment to funding strategically selected and judiciously monitored research. Industry must also commit to modernizing and investing in the technology federal research dollars develops.

At the same time the digitization of our society is in its mere infancy, and we can already project that the world's electricity supply will need to triple by 2050 to keep up with demand. Consider that Twitter alone — with 1 billion Tweets sent every week, at 0.025 watt-hours per Tweet — is responsible more than 2500 MWh per week of demand on the grid that simply did not exist before the application's advent. And then you factor in services such as Internet TV, video streaming, online gaming, the digitization of medical records, smartphone applications. It's very easy to see that we have to build a stronger and smarter electrical-energy infrastructure.

America's long-term goal ought to be transitioning our power grid system on to a Smart Grid.  There are many definitions of the Smart Grid, a suite of technologies that would catapult America into the 21st Century. The term "Smart Grid" refers to an overlaid/interwoven system that uses information, sensing, control and communication technologies to allow it to deal with unforeseen events and minimize their adverse impact.

Recent policies in the U.S., EU, China, India, Korea, Brazil and other nations, combined with potential for technological innovations and business opportunities, have attracted a high level of interest in smart grids. Smart grids are seen as a fundamentally transformative, global imperative for helping the planet deal with its energy and environmental challenges.

The Smart Grid starts at the fuel supply link to the electrical power generator and ends at your refrigerator, homes and businesses. Over the next decades of global rollout, the Smart Grid's benefits could empower businesses and individuals with more control over their electricity consumption, enabling greater reliance on renewable power sources and distributed generation, strengthening energy security and creating new services and business models. Every single person on the planet is a stakeholder in the Smart Grid. From individual consumers to the world's largest businesses, regulators, politicians, academia, etc., every single person is going be touched by the Smart Grid in some fashion.

On options and pathways forward, I am often asked "should we have a high-voltage power grid or go for a totally distributed generation, for example with microgrids?" We need both, as the "choice" in the question poses a false dichotomy. It is not a matter of "this OR that" but it is an "AND."  To elaborate briefly, from an overall energy system's perspective (with goals of efficiency, eco-friendly, reliability, security and resilience) we need both 1) microgrids (that can be as efficient and self-sufficient as possible, and to protect themselves rapidly during emergencies), AND we need 2) a stronger and smarter power grid as a backbone to efficiently integrate intermittent renewable sources into the overall system. The total costs are:

  1. Stronger Grid: The current high-voltage system needs to be expanded and strengthened. The total cost of the stronger transmission system is about $82 billion ($8 billion per year for a decade).

  2. Smarter Grid: The total estimated net investment needed to realize the envisioned smarter end-to-end power delivery system of the future is between $338 and $476 billion, which translate into annual investment levels of between $17 and $24 billion over the next 20 years.

The costs cover a wide variety of enhancements to bring the power delivery system to the performance levels required for a smart grid. They include the infrastructure to integrate distributed energy resources and achieve full customer connectivity but exclude the cost of generation, the cost of transmission expansion to add renewables and to meet load growth and a category of customer costs for smart-grid-ready appliances and devices.

Moreover, investment in a Smart Grid would nearly pay for itself by reducing stupendous outage costs — a savings of $49 billion per year — and improving energy efficiency — a savings of $20.4 billion per year.   Likewise, through Smart Grid-enhanced energy efficiency, by 2030 CO2 emissions from the electric sector would be reduced by 58 percent.

The benefit-to-cost ratios are found to range from 2.8 to 6.0. Thus, the smart grid definition used as the basis for the study could have been even wider, and yet benefits of building a smart grid still would exceed costs by a healthy margin. By enhancing efficiency, for example, the smart grid could reduce the cost of infrastructure expansion and overhaul in response to annual peaks. The demand response and smart grid applications could reduce these costs significantly. At the same time, increased cyber security, and overall energy security — if security is built in the design as part of a layered defense system architecture — would safeguard this fundamental critical infrastructure.

Americans should not accept or learn to cope with increasing blackouts.  Nor should we rest on the notion that the technical know-how, political will, or money to bring our power grid up to 21st century standards do not exist.

The truth is, as a nation we must and absolutely can meet the power needs of a pervasively digital society, if the United States wishes to maintain its role as a global economic and political leader. The best of American innovation is yet to come and the Smart Grid must be part of our future.


Comments on this story may be emailed directly to Today's Engineer or submitted through our online form.


Dr. Massoud Amin (umn.edu/~amin), a leading expert on the U.S. electricity grid, coined the term “Smart Grid” in 1998. He serves as director of the Technological Leadership Institute at the University of Minnesota and is a professor of electrical and computer engineering. He works on enabling smarter, more secure and resilient infrastructures and is leading extensive R&D efforts in smart grids and infrastructure security. A Fellow of the ASME, a Senior Member of IEEE and the Chairman of IEEE Smart Grid Newsletter, he also contributes to public policy as a member of the IEEE-USA Energy Policy Committee.

Comments may be submitted to todaysengineer@ieee.org.


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