Panelist noted that National Grid partners with government and industry to share information on both cyber, physical security
It is going to take a breadth of skills and competencies to develop, operate and maintain the transmission infrastructure moving forward, Mary Ellen Paravalos, director, performance and strategy with National Grid USA, said on Dec. 3 during TransForum East presented by PennWell’s TransmissionHub in Washington, D.C.
“[I]t will continue to be very important, moving forward, to have these skills and capabilities – everything from engineers to operators to accountants and economists, attorneys, even – to help us maintain and develop the backbone of” the nation’s transmission system, she said during the “Executive Perspectives” panel. “It’s going to be really important to be able to have the system do what it needs to do before it’s called upon to do it.”
She also noted that the drivers toward cleaner generation are going to continue, and that energy prices are going to remain under pressure.
Many of the regions have high electricity costs, and in many places, that is caused by infrastructure constraints. “[T]here is more that we can do as an industry to remove these constraints, or mitigate these constraints,” she added, noting that the industry can also put in place energy efficiency measures and demand response tools to manage and reduce energy costs for customers.
Noting that customers have more choices today as to how they will serve their energy needs, Paravalos said that she expects to see more interactions between the customer systems and the distribution systems.
Another theme she discussed involved attracting, developing and sustaining workforce talent.
The utility industry has an aging and experienced workforce, she said adding that National Grid and other utilities must sustain talent as well as bring in new talent through partnerships and programs “because over the next decade or two, we will be undergoing a significant shift in the industry.”
Incentives for the future
During his presentation, panelist Sandy Aivaliotis, senior vice president, Operations, Technology, Business Development, with The Valley Group, discussed the Oncor Electric Delivery Smart Grid Demonstration Program (SGDP) project, which according to an August 2013 final report on the project, applied real-time sensing instrumentation that monitored the line conductor tension from several transmission lines. The project was co-funded by the U.S. Department of Energy and Oncor.
That information through an algorithm is used to calculate the dynamic line rating (DLR), which represents the maximum line capacity – the maximum power transfer capacity of the transmission line, based on ambient weather conditions and the physical location of the transmission lines. Oncor, the report added, installed and commissioned the DLR technology to provide dynamic ratings and perform utility studies on eight transmission circuits on its system.
The project involved installing instrumentation that monitors the tension of the conductors in real time, the report said, noting that the sensing technology and associated algorithms translate the line tension into the available line rating that can be safely maintained in the line section being monitored. That rating is provided to the system operator’s console and the system “State Estimator” model. The real-time DLR provides increased capacity 90% to 99% of the time and has the potential for reducing transmission line congestion and allowing the system to operate at optimum levels for a greater proportion of the line, the report added. The line capacity is established as a line rating correlating conductor type and size with ambient wind speeds, temperature and solar radiation, according to the report.
Aivaliotis noted that the objectives of the project were to remove existing commercial constraints and demonstrate that the DLR technology can be reliably integrated into operations. According to his presentation, the project also sought to quantify cost structure and benefits for future grid planning, establish interoperability with utility transmission management systems, and clear the road for wider deployment.
Today, he said, “there’s technology out there that can actually tell you [that] you have much more capacity most of the time than you think you’re having and, more importantly, this technology can actually mitigate some of the potential risk.”
Noting the generation switch from coal to natural gas, Aivaliotis said, “[W]e tend to think of transmission as a fixed asset because there’s … tons of steel and aluminum hanging in the air, but that transmission was built to accommodate electricity,” he said. “What this project shows is that a particular fixed asset is flexible in how much it can actually transport. So, when you have a line that is say, 10[%], 15% congested, the key decision for a utility is, ‘Do I want to spend $3[m] to 4m a mile to build a new [transmission] line, or do I optimize what I have first and then build additional assets?’”
Referring to the Oncor project, he said that that is one example of a smart grid technology that is needed, adding that the question remains, how can utilities be incentivized to look at such technology that is measured on performance?
The incentive structure is not lined up for the future, in which smarter technologies are going to be inevitable to preserve capital. “We cannot continue building forever,” he added. “We have to look at how do we make it easier for the utility to apply for these incentives for advanced low-[capital expenditure (capex)] technologies.”
One idea, he said, could involve, for example, an existing 30-mile transmission line, valued at $100m, with the utility having received approval of a 10% return on equity (ROE). If that utility decided to mitigate congestion for reliability reasons, or any other reason, and decided to implement those advanced technologies, regulators could “use the same framework that you have and perhaps look at the value that these smarter technology really brings, and be very, very diligent about that.”
He continued: “[R]ather than 10% [ROE], you can go [to] 10.25%, 10.5%. So, this achieves a couple of things, in my view: you maintain the existing process, you don’t have to change the whole process, which we all know is very time-consuming, but recognize that a utility can have room to earn something more by taking the risk in integrating advanced technologies.”
Paravalos noted that FERC has its policies around how it is incenting the transmission improvements that it thinks are going to be needed over the next few decades, and the amount of change in the system is going to be significant, with potentially hundreds of billions of dollars needed over the next few decades for transmission infrastructure.
“[T]he scale is very big, so I think it’s important to be able to have regulators maintain focus … on the kinds of investment levels that we’re going to need in the transmission system,” she said, adding, “That being said, I think that tying incentives to performance and making sure we are eking out the most performance from the transmission system is really important.”
Connect21, siting matters
Paravalos also discussed some examples of National Grid’s “Connect21” vision, which has three primary functions that focus on customer and policy drivers, the energy network as well as technology and market drivers.
She noted, for instance, that the New England East-West Solution (NEEWS) family of projects is nearing completion. National Grid’s investment in NEEWS is about $750m, she said.
“We’ve completed siting,” she said. “It’s a large, three-state project that we are undergoing with Northeast Utilities [(NYSE:NU)], and it really is going to fortify that area of the New England backbone transmission system.”
Because it traverses three states, the series of 115-kV and 345-kV upgrades has “taken a while to get all the siting lined up and approved,” she said. “We just got siting for the last leg of it from Massachusetts, so hopefully we’ll have this all done and in place [by the] end of next year.”
Other examples of the company’s efforts are the 20-mile, bi-directional, underwater cable that it is building off of the coast of Rhode Island that will connect the 30 MW Deepwater Wind offshore wind demonstration project, as well as the Worcester, Mass., smart grid pilot program that is underway and involves about 15,000 customers, she said.
Obtaining regulatory approval for a project as large as NEEWS meant increased coordination with Northeast Utilities as well as “with the regulators, really, to be able to explain to them the regional benefits of a piece of transmission project that’s going through their state, and what that translated to was more time to the regulatory process,” she said.
Aivaliotis noted that there are certain technologies available today that can help in long-term transmission planning. “I think the uncertainty about transmission planning has increased in the most recent environment, when you’re looking at the generation switch that’s happening, which would become more and more prevalent in the next 10, 15 [and] 20 years,” he said. “New technologies can help optimize what you have before you commit capex, which in five or 10 years from now, can become a stranded asset.”
On cyber security, an aging workforce and diversity
Among other things, the panelists discussed cyber security matters. Paravalos, for instance, noted that National Grid is continually monitoring changes in the landscape, as well as new risks, and is focused on being able to respond appropriately. The company partners with government and the industry to share information on both cyber and physical security, she said.
Discussing the aging workforce, she noted that the workforce that is needed for the future is “a combination of leveraging the existing, deep industry know-how that we have now … and marrying that with the requirements of the future, which are going to look a little bit different” with a different generation mix and new technologies.
National Grid thinks about it in a holistic approach by, for instance, being involved in schools at the K-12 level, partnering with community colleges and other institutes of higher learning, and “moving into internships and mentorships with folks that we actually bring into the organization, and developing our existing talent as well to be able to respond to those new business needs,” she said.
Of diversity in the workforce, Aivaliotis noted that as a manager of a technology firm, one thing he really likes about technology is that it has no race, adding: “Just bring me a good engineer – I will hire him or her today.”
Paravalos said: “[W]e want our workforce to reflect the communities that we are present in because we need that talent, frankly, and our country is an increasingly diverse one. It’s really important to leverage all the talent where it exists, in our communities, and so we have a number of diversity programs, trying to not only attract talent, but retain talent as well.”
National Grid is a subsidiary of National Grid plc.