(Editor's Note: SDG&E’s parent company, Sempra, just received the green light to develop 100 megawatts of small solar power facilities in San Diego.)
To start things off Lee, you’re well known in the smart grid community, but this is your first exposure to our audience. Briefly talk about your role and where smart grid fits in at San Diego Gas & Electric (SDG&E). We’re very much looking forward to your keynote at our upcoming Smart Grid Summit in October. Can you give us a sense of what attendees can expect to hear about with your topic of San Diego’s Smart Grid: Moving from “if” and “when” to “now” and “here’s how.”
Leading up to the Smart Grid Summit next month, this is the first in a series of Q&A interviews I’ll be doing with our speakers. This interview was conducted with one of our featured keynote speakers, Lee Krevat, director of SDG&E’s smart grid programs.
While the value of Smart Grid continues to be debated nationally, in SDG&E’s territory: contracts are being signed to meet a 33 percent renewable portfolio standard, a record amount of distributed generation is being installed, over a thousand orders for the Nissan LEAF electric vehicle have been placed including some cars being ordered, and 1.3 million smart meters have been installed. The smart grid discussion needs to move from “if” and “when” to “now” and “here’s how.”
With the rapid changes in technology, we are looking at a major transformation of the utility industry. The utility business can be compared to where the communications business was in the late 1980s when typewriters were being replaced by desktop computers. We expect to see more change in the next decade than we’ve see in the last 100 years. The scope and complexity of the changes will take some getting used to, but we are committed to helping our customers make the transition as smoothly as possible.
These changes also are forcing us to review our role as a utility. When the paradigm changes, we must be prepared to change with it. The actions we are taking today are aimed at creating a more environmentally friendly and sustainable future where consumers have more information, control and choices over their energy use. It is vital to align interests of utilities, customers and policy makers. There are many opportunities for the utilities beyond our current role of delivering gas molecules and electrons. We are charting new territory and we welcome the possibilities and challenges.
In many ways, California is at the vanguard of smart grid, and SDG&E is right there leading the way. I’d like to first get your take on what makes California so different, and more importantly, what you think they’re getting right so far with smart grid?
SDG&E has installed more than 1.3 million smart gas and electric meters thus far, and is our foundation for the smart grid. In the near future these two-way communications devices will provide customers real-time information and pricing to maximize energy efficiency. With completion of the smart meter installation, SDG&E will have more than 2 million data points on our system. Customers will benefit from the smart grid by having in-home devices to help stay on top of their energy usage and save money.
SDG&E received $28 million in stimulus funds to develop a communications infrastructure to integrate all company systems on one platform; in addition to these funds, SDG&E is spending $34 million in utility capital on this network. Our strategy for smart grid communications is a consolidated, custom-designed wireless infrastructure. All with the future of smart grid in mind. Completion for this network scheduled for late 2012.
SDG&E received $10 million in grants from the Department of Energy and California Energy Commission (News - Alert) for a microgrid project in Borrego Springs, a progressive desert community with a high concentration of solar energy. Here we will test and deploy various “smart” technologies – such as energy storage, smart meters, energy-management systems, and integrated renewable energy generation. We plan to demonstrate how to maintain reliability in a more complex grid, leverage distributed resources to benefit the community and electric system, enable more active participation by customers, and maintain power – or “ride through” an outage – even when the larger grid is experiencing problems.
This project is a “laboratory in action,” where we can see on a small scale a version of the smart grid all the way from customer-generated solar power, to battery storage, to automatic power restoration. Today’s smart meter technology alerts us when a customer’s power is disrupted. Eventually, technologies will become sophisticated enough to alert us when a system is about to fail, remedy a potential problem before it occurs. During this self-healing process grid switches will automatically re-route power to restore an outage without any human intervention.
With more and more renewable energy continually being added to the regional power mix it requires the need to manage the intermittency of wind and solar resources. The smart grid is a vital part of the solution to that challenge.
One of the areas SDG&E is showing market leadership is with smart meters. I’d like to hear about where you’re having success here, but also a bit about the challenges. We all know there has been pushback, in Northern California with smart meters. How is SDG&E addressing this, and what are some of the lessons learned here?
SDG&E has been proactively doing customer outreach long before we started our installation and we think this has been a great benefit to our customers. Collaboration is our number one priority and early on we formed a technology advisory panel with advocacy groups and national experts to vet our technology of choice and our plan to implement with our customers. During a Sept. 2 California Public Utilities Commission hearing, a third party smart meter consultant “The Structure Group” called SDG&E’s smart meter program the gold standard to benchmark deployment and customer outreach best practices.
We held customer co-design groups and learned that during installation things like waiting long enough to turn off the power after you knock, and knocking loud enough, were big concerns for our customers so they should be big concerns for us.
We are visible with our outreach in communities. For example, 90 days before we install our first meter we are in that community at council and planning commission meetings, local events and 30 days before a letter is sent out to each resident. We also have dedicated customer service representatives that are available to any customer that has a smart meter question.
Wireless spectrum is a key factor for getting full value from smart meters. This area is a key intersection between the worlds of utilities and telecom. How effectively can utilities optimize wireless from within, as opposed to working more closely with wireless telecom operators?
As a utility, SDG&E’s focus is on protecting our customers’ information. That is why much time and effort has been spent on privacy and security. In addition, we are focused on keeping our grid reliable during emergency situations. We need to be able to touch each of our installed endpoints and from our extensive research, wireless provides us with the best flexibility in these areas. To maximize customer benefits, we are working with both public and private wireless communications technologies, depending on which best meets our requirements.
How are California’s renewable portfolio standards driving the smart grid for SDG&E? What will this mean for SDG&E, and what will it mean then for both consumers and businesses?
SDG&E has renewable contracts in place to obtain nearly 14 percent of our electricity from renewable sources in 2010 and an estimated 21 percent in 2012. We are spending $400 million to develop more than 200 megawatt (MW) of wind and solar in the eastern part of our territory and Imperial Valley. This and a new 500 KV transmission line will help us achieve our goal of gaining 33 percent of our power from wind, solar and other renewable energy sources by 2020. We were the first investor-owned utility in California to agree to the 33 percent goal.
SDG&E has a 50 percent interest in the development of a 160 MW Campo Kumeyaay reservation wind farm and is developing a wind farm on land owned by the Manzanita Band of Mission Indians. We’re also working with customers on distributed rooftop solar installations in our service territory.
On this topic, I’d also like your thoughts on how far you think wind and solar can go as sources of everyday energy. What has to fall into place for renewables to be more than a stopgap source of intermittent power?
In addition to our renewable efforts, San Diego County is first in solar adoption in California and SDG&E recently completed the 10,000th residential solar installation in our service territory. San Diego leads the nation in the number of solar rooftops with over 75 MW of solar in our service territory. Residential solar is over 38 MW and growing at almost 3 percent a month.
The smart grid is required to successfully integrate intermittent solar and wind generations. Key to our efforts will be improved forecasting application and energy storage technologies to make renewables a more predictable and reliable resource.
Finally, how do you see the relationship evolving between utilities and customers in order to make smart grid more beneficial for both parties?
Smart meters are the foundational technology for the smart grid and the first interaction that customer will have with it. While smart meters are advanced technology, a key to their success is our communication with our customers about when they will receive this technology, how it will work and how customers can use smart meters to their benefit and reduce energy. Communication of this forward-thinking technology should be a priority.