Our electric grid is one of the most complicated systems that has ever been built. We have confidence that our electrical system is generally meeting the needs of people throughout the U.S. — unlike our electoral and election systems, which are beset by hackers, hanging chads and foreign interference. Nevertheless, new technologies such as solar, wind, battery storage, EVs, control systems and software present opportunities to improve the effectiveness and reduce costs throughout our electrical grid.
The traditional electric grid design depends on centralized power generation, sending power to customers in two stages: first over long distance high voltage transmission lines, and second over lower voltage local distribution lines. Power flowed from the generator to the customer using a top-down communication system. This centralized electrical grid, managed by public utilities, has served us well for over 100 years.
With rooftop solar, customers are generating their own power and sending the excess back to the grid (consumed by their neighbors). With batteries, customers can store their daytime-generated solar energy and use it at night, or use their batteries to meet peak power loads. And now, with the right software and communications, these local solar generators, batteries and control systems can be aggregated into a Virtual Power Plant, or VPP.
These new technologies are cheaper, more flexible, more reliable and cleaner than the traditional grid. But they function more as a network of billions of devices – similar to the way our telecommunications systems operate. Moreover, this combination of new grid technologies and a networked architecture is antithetical to the “top down” way that traditional utilities operate. Please listen to this week’s Energy Show to learn about the design of this networked electric grid of the future — and why the traditional utility business models must change as VPPs become more commonplace.