SIEMENS

Europe established its first power plants around 120 years ago and then gradually expanded its systems for supplying electricity through power sockets. “We’ve been pretty much muddling along blindly ever since,” says Jürgen Knaak, Managing Director of Arbon Energie AG, the local power utility company in Arbon, a small Swiss town with 13,000 inhabitants. “Even today, neither consumers nor suppliers know exactly when electricity is flowing through power lines, or how much of it is flowing.” But that’s about to change in Arbon, thanks to smart meters. Since 2007, Siemens has been replacing the town’s approximately 8,700 household meters with new high-tech devices. “For the electricity industry, this is a veritable revolution, comparable to the introduction of cell phones or the Internet,” explains Knaak.

In Arbon, “blind muddling” meant there was practically no transparency about what actually happens in the town’s grid, with information in this area limited to the periodic measurement of electricity consumption by households, businesses, and manufacturing facilities. Much more information will be required in the future, however. “The generation and supply of electricity is becoming increasingly complex, and we have to be able to address this challenge,” says Knaak. The “Amis” meters from Siemens that are being installed in Arbon are state-of-the-art devices that not only measure electricity consumption, but can also collect data from gas, water, and district heating meters through corresponding interfaces. This data is then forwarded to the power utility company without delay, ensuring that the supplier is always fully informed of each consumers’ electricity needs — from individual refrigerators in private homes all the way up to major industrial consumers. Around 3,300 smart meters have been installed in Arbon to date, with this process scheduled to be completed by the end of 2013.

As that date approaches, a new era will commence for Knaak, bringing with it a new business model that is meant to ensure the success of his company. That’s because information will be as valuable as energy in tomorrow’s electricity market, where detailed data on electricity consumption will make it possible for utility companies to offer customized rate models and exploit a real competitive advantage.

And what about consumers? Not only will they be better informed about where electricity is being used in their businesses and homes; they’ll also be able to manage consumption in a more targeted manner. For example, Knaak can tell the municipal utility company of the Swiss city of St. Gallen almost to the exact second when it would be least costly for it to pump drinking water out of Lake Constance, and thus offer the firm a better rate model. Similarly, thanks to information furnished by real-time metering, Arbon Energie AG should be able to improve its bottom line by purchasing electricity when the price is particularly low due to generation overcapacities.

Smart Meters. What will things be like ten or 15 years from now? According to Knaak, at first glance, the situation won’t change much for private or commercial electricity customers. That’s because electricity will continue to come from the power socket and, of course, still be available whenever it’s needed. But the mechanical meters that are still widely used and often only read once or twice a year will be relegated to science museums.

The grid of the future will be an information network, enabling households to run their washing machines at times when electricity prices are low. Appliances will be controlled fully automatically, and consumers will be able to switch devices on or off online or commission a grid operator’s energy optimization program to do so. “Consistent implementation of such an approach would probably lead to substantial cuts in electricity consumption,” predicts Michael Moser, a department head at the Energy Research Section of the Swiss Federal Office of Energy. As a result, Switzerland could reduce its energy consumption by approximately five to ten percent, thus giving consumers and the environment a break.

Electricity Highways. Smart meters are a byproduct of the trend toward digital power supply systems. Grid design will pose a far greater technological and economic challenge, because most electricity will no longer be generated by a few large plants, as is the case today, but by many small and medium-size producers, which will sometimes only produce energy for their own needs, and at other times feed power into the grid.

The grids that until now were practically only one-way streets will be turned into multilane energy highways (see Pictures of the Future, Fall 2009, Switching on the Vision). Wind turbines, for example, will operate at full load when there is strong wind, while natural gas and biomass power plants will be switched on when demand increases. There will also be more and more electricity storage systems for collecting energy from fluctuating renewable sources. From today’s perspective, smart grids still sound a bit futuristic. But scientists — including those at the smart grid testing facility at Siemens Corporate Technology (CT) in Erlangen — are already working on a number of advanced systems. Experts at the facility are developing special control algorithms and hardware components for smart grids, which involves combining experiments with sophisticated simulations. “We are simulating the electricity transmission network of an actual German village, for example, where a large share of the energy is generated by photovoltaic systems,” says Dr. Jochen Schäfer, who directs the development, testing, and demonstration of hardware components in CT’s Smart Grid lighthouse project.

In the simulation, one of the streets in the village was the object of particular interest. “The place has many big producers of photovoltaic energy but only a few small electricity consumers, which means intense solar radiation can create a critical situation for the grid’s stability,” explains Schäfer. In response to this problem, experts conducted a laboratory test in which they recreated a 1:7 scale copy of the parts of the grid in question, including energy producers and consumers, as well as line resistances.

Solar cells are simulated by inverters that get their energy from a separate grid. This makes it possible to set the testing conditions, such as the intensity of incident solar radiation. “We can now test and investigate control algorithms and critical situations not only in simulations, but also in real life,” reports Joachim Bamberger, who manages Siemens’ Smart Grid research project.

In practice, a demonstration scenario might involve a cloud bank passing over the village. This causes the electricity generated by the imaginary photovoltaic systems (i.e. the electricity fed into the grid by inverters) to drop drastically. Because the village has to fully cover its electricity needs from local production, researchers use a battery to temporarily offset the decrease until a cogeneration plant can be started up in their Erlangen lab.

lectricity production is compared to actual need by a trading mechanism that was previously tested in the simulation. “The adjustable components, such as the battery and the cogeneration plant respond to price signals at a local electric power exchange,” explains Bamberger. Prices rise if less solar energy is available, causing the village’s more costly electricity generation or storage systems, such as its battery and cogeneration plant, to begin supplying energy. At the same time, electricity use in the village decreases because the electricity price influences consumption by heat pumps and cooling units, for example (see article "Automation’s Ground Floor Opportunity").

“If these electronic control systems prove effective in the simulation, we can use the findings to test the systems in laboratory experiments and demonstrate their operation,” says Schäfer. The results to date have been so good that the Siemens researchers are planning to start a pilot test in a grid operated by southern German utility Allgäuer Überlandwerk (AÜW). When that happens, tomorrow’s smart grid will have taken another big step toward becoming a reality.