How to Transform the Smart Grid, According to NEMA
The National Electrical Manufacturers Association (NEMA) submitted 14 recommendations to the Obama administration on how to transform the smart gird as part of the administration’s Quadrennial Energy Review. Let’s take a look at their recommendations what they suggest for transforming the grid.
1. Incentivize the construction of microgrids and energy storage systems.
A microgrid, or a “localized grouping of electricity generation, energy storage, and electrical loads,” stores electricity when demand is low. They help improve reliance and efficiency of the grid, making them a necessary part of the future of the grid.
2. Amend eligibility requirements for federal flood insurance to require water-resistant components, wiring, cabling, and elevated substations in federally-designated flood plains.
This is as simple as updating grid infrastructure to make it water resistant, and thus making it less waster-based disaster prone in areas where that is of great concern.
3. Amend the Stafford Act to allow disaster assistance to be used to replace damaged equipment with more resilient technologies, including on-site back-up power.
The Stafford Act is a piece of legislation that allows for funding of emergency relief programs. NEMA recommends that instead of fixing what’s already broken, it’s better to replace the old, broken grid tech with new, energy efficient tech. This would help improve the grid, even in a time of crisis, and thus safe cost by making a smart investment rather than fixing something likely to break again.
4. Allow use of Community Development Block Grant (CDBG) funds for restoration of privately-owned electric utility infrastructure.
In previous cases of “exceptional damage” to the electric grid, funds were allocated for repair or rebuilding of privately-owned utility infrastructure. This was not the case during SuperStorm Sandy. NEMA is arguing that these CDBG need to be used for this again, as it would reduce the overall economic impact.
5. The federal government (FCC and NTIA) should allocate a common set of frequencies for communication with intelligent electrical devices, enabling faster restoration of power, more efficient use of capacity, and improving grid security by regulating products operating within the frequency band.
This would essentially give smart grids their own highways to operate on, making them more secure and efficient. They wouldn’t have to compete with other frequencies, allowing for easier access.
6. The Federal Energy Regulatory Commission (FERC) should have backstop siting authority for interstate transmission lines, similar to authority they have for natural gas pipelines, including lead authority in coordinating environmental and other reviews.
This would help streamline projects, while keeping the majority of the rights of the states.
7. Facilitate installation of smart technologies that reduce transmission congestion by updating FERC Order 1000 on cost allocation.
Order 1000 allows transmission provides to join a region, giving that region planning flexibility and cost allocation. The report finds that Order 1000 can be a hindrance to smaller, more targeted smart grid projects due to its high-dollar thresholds. NEMA notes that these projects can have really high cost-benefit rations, but really low installation costs that don’t meet threshold requirements. A reduction of these thresholds would allow for projects to use the most recent tech and keep costs down.
8. NIST, in collaboration with industry, should develop better reliability metrics in order to facilitate transmission investments and improve reliability.
This is as simple as improving metrics and using the data collected from grids to facilitate more effective upgrades.
9. Cybersecurity: Promote industry-led consensus standards to protect the grid from cyber-attack and expand liability protection to incentivize innovations and the development of technologies to protect the electric grid from increasingly sophisticated cyber threats.
NEMA argues that grid security be brought up to current standards. With grid security rapidly evolving daily, in both innovations and threats, it’s important that the industry keep up with the trends. NEMA believes that the private sector is up to the challenge, but current vulnerabilities are holding back further innovation. “We recommend that the SAFETY Act’s liability protections be expanded to cover critical infrastructure industrial control systems, associated software, and other related cybersecurity technologies,” the report notes. “Such protections are essential to incentivize innovations and the robust development of technologies designed to protect the electric grid from increasingly sophisticated cyber threats.”
10. Physical Security: the federal government should work with industry to establish standards for physical hardening of transformers and substations and require deployment of advanced sensing equipment at critical junctures in the electric grid.
In 2013, a PG&E substation in San Jose was ‘sabotaged.’ Fiber optic cables were cut in an attempt to shut down service. NEMA argues that physical security needs to be stepped up dramatically in order to defer attempts like this. “Proactive substation design, including compact gas-insulated substations, will allow critical facilities to be fully enclosed and secured for greater protection,” it states.
11. Authorize the Department of Energy to require strategic siting of: spare transformers, long lead-time components, and regional pools of equipment reserves.
NEMA essentially recommends backup options always be available in order to allow for rapid response in times of crisis.
12. Accelerated depreciation for Smart Grid technologies.
This would mean creating tax incentives for smart grid tech, making long-term smart grid projects more incentivized. NEMA believes that “greater energy efficiency is a national priority that will boost economic productivity and competitiveness, enhance U.S. energy security, mitigate outages and reduce emissions.”
13. Offer federal incentive grants to states to adopt performance-based regulatory models that reward modernization and efficiency rather than increased consumption.
NEMA notes there is a huge investment gap of $11 billion for transmission and distribution infrastructure. This could lead to a huge gap of $730 billion by 2040. They argue that utilities need to modernize their business models, which needs to be complimented by updated regulations.
14. Establish a national infrastructure bank (NIB) to incentivize modernization of the electric grid and other U.S. infrastructure.
This would incentivize grid innovation on both a short-term and long-term basis. NEMA believes this would solve the previoius problem, recommending “Congress consider establishing a national infrastructure bank (NIB) to leverage private sector investment in modernizing the electric grid and close gaps between the rate of return the private sector requires and the revenues that current rate structures can generate.”
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.