From rural to metropolitan areas, an ecosystem of smart grid deployments based on cellular networks is providing cost-effective, secure, fast and reliable service that benefits utilities and ratepayers.
Major cellular network companies and their smart grid partners are taking a united stand around the benefits of cellular over proprietary networks for utilities’ smart grid deployments. Historically, utilities have supported an economic model based on the philosophy of “build, own, control and manage your own network.”
Now, these cellular providers and smart grid partners have turned that aged paradigm on its head. They advocate a digital cellular network strategy, which leverages the networks operated by the world’s most successful telecommunications companies.
Since these networks already exist, they provide a greater ROI to utilities than proprietary ones (which will inevitably require costly technology upgrades and equipment replacements). Using cellular networks today costs utilities dramatically less than the “build, own, control and manage your own network” model they have come to accept, while also providing them a scalable platform with the bandwidth needed to support tomorrow’s smart grid applications.
Over the last five years, electricity providers, technology companies, regulators and the federal government have poured billions of dollars and millions of man hours into a major upgrade of the antiquated electric grid, yet the potential for future growth remains staggering.
According to GTM Research, the U.S. smart grid market will grow more than 70 percent, from $5.6 billion in 2010 to $9.6 billion by 2015. (Raju Shanbhag, “Smart Grid” Online, Sept. 24, 2010). Existing networks like those operated by AT&T, Cellular South, Rogers Wireless, Sprint, T-Mobile and Verizon are recognizing the revenue opportunities that the smart grid presents. Commercial carriers can make 50 times more on a data rate basis on the smart grid than they can on a smart phone.
As a result, utilities are becoming increasingly open to leveraging cellular technology. Smart meters are now seeing increased adoption, and newly installed digital meters are introducing the smart grid into homes and businesses. This innovation is driving an industry-wide move on the part of utilities away from traditional meter reading, which captures one manual billing read per month, toward the more precise and frequent sampling of interval data.
By collecting and reporting usage data in 15-minute buckets, smart meters can effectively gather 96 pieces of information per day (or more than 35,000 pieces of data per year, per customer).
Standing to benefit from a more precisely sampled reading of consumer power consumption and utilization trends, utilities are moving quickly to deploy networks needed to capture that data for analysis.
Creating the network that can capture all that information, however, is enormously complex. When applied to the emerging applications of the smart grid, the old “build, own, control and manage” approach to networking leaves a lot to be desired. Despite the claims of wireless LAN providers, setting up and maintaining private, proprietary solutions is anything but simple.
With potentially thousands of paths of communication to follow up on, a single meter failing to report can create a troubleshooting nightmare even with solutions guaranteeing a 95 percent first-time read rate. Spread across 50,000 devices, that last 5 percent means utilities still need to divert tremendous resources away from maintaining the electrical grid to troubleshooting their networks instead.
Far from being easier to repair, private networks actually introduce new disaster preparedness challenges. When a storm knocks both the electrical grid and the network offline, repairing communications equipment needs to take a lower priority than restoring power.
Add to that the performance erosion of high-latency private network solutions, when security measures are layered on, and it becomes clear that the hidden costs of maintaining private networks are significant.
Simply put, a utility should not have to divert its best resources to run, manage and secure duplicative networks when cellular network providers are in that business already.
Cellular networks are cost competitive with private networks. Traditionally, a utility could not afford to use a commercial wireless carrier network as its primary network for the smart grid as it was too expensive to install a high-speed, IP-addressable endpoint for residential smart metering at every home.
Now, however, it is dramatically less expensive for a utility to leverage a commercial network for its smart grid rollout than building, owning, controlling and managing its own proprietary network.
Carriers have dropped their rates by as much as 95 percent in the past 12 months. Over a 10-year period, some carriers estimate that the cost of a public smart grid network would be half the cost of a private network.
Cellular companies are also better positioned to support the mass data coming from meters and switches. If every water, gas and electric meter in the U.S. (about 300 million meters) transmitted a day’s worth of its 15-minute interval data, it would amount to an increase of less than 2/1000th of 1 percent (specifically 0.00018 percent) in the amount of data that a typical carrier transfers across its network on a daily basis.
There is more than sufficient bandwidth for the needs of meters because the bandwidth speed of a smart grid cellular network doesn’t have to compete with other data transmissions.
When a utility uses a commercial carrier for its smart grid network, the data being transmitted is not being interspersed with text messages and phone calls, but rather through a dedicated network channel (which is like a private network already built out). Cellular networks are essentially giving utilities a “private communications channel” so consumer application data (like text messages and e-mail) is not interfering with smart grid data.
IP-enabled smart meters powered by cellular networks allow utilities to use up to a full megabyte per meter, per month—that’s up to 10 times more data for the same price than a private network can offer.
Cellular networks maintain security protocols strong enough to protect the integrity of the smart grid. Commercial network providers spend billions of dollars annually to maintain secure networks – and the same layer of fortification being used to secure cellular-based smart grid devices is protecting the millions of daily financial transactions, military data transmissions and even the e-mail on President Obama’s Blackberry.
The level of security being deployed by the commercial carriers far exceeds National Institute of Standards and Technology (NIST) requirements and is constantly improving as the ecosystem of vendors supporting the billions of devices on commercial carrier networks continually enhance security protocols. IPSec and other high-bandwidth security algorithms can also be implemented by leveraging the bandwidth of commercial networks, which is not possible on a narrowband or 900 MHz (private) network.
Cellular networks are robust enough that coverage is not an issue for utilities, and they are reliable in emergency situations. By leveraging a commercial network strategy, utilities can effectively implement a multi-network solution in its service territory that is carrier-agnostic — so even if one carrier doesn’t work, another can be used.
It has been proven that commercial network carriers combined (not any one carrier) cover more than 97 percent of America’s population – and that is with voice — not the data network that transmits at a higher wattage with a more powerful antenna.
The data sent by a meter actually uses a fraction of the bandwidth of a cellular phone call, and the antenna on a meter is almost four times as powerful as that of a cell phone. The cellular carrier model appeals not only to large, investor-owned utilities in mainstream areas, but also to city-owned utilities in more rural areas such as Griffin, Georgia, where 16,000 meters using cellular-based smart grid technology are being deployed.
Also, a trial deployment of 10,000 smart meters by Texas-New Mexico Power (TNMP) in 2009 resulted in a 99.96 percent positive and accurate daily read rate. Such results are not being achieved by private networks.
Disaster preparedness
Looking at prior natural disasters like Hurricane Katrina, cellular networks were operational again within days. Meanwhile, most private network infrastructure was ruined and took a significant amount of time to be reconstructed, which came at the expense of utilities.
With a cellular network, the carrier covers any costs associated with repairing its network, not the utility. Add in the fact that intelligence is engineered into cellular network-compatible devices — the devices know when there’s a major outage and what to do — and there clearly is no comparison, when looking at cellular network connections alongside private network connections.
Utilities want to invest in a technology that has a life cycle that supports its business case, and carriers understand this point. Carriers are committed to machine-to-machine (M2M) communications as a major growth area, realizing the smart grid represents the greatest potential for M2M growth.
As a result, cellular smart grid leaders are hard at work tailoring offerings for the special needs of electric power utilities. Most technologies are backwards-compatible, but with the cellular network model in place, technology obsolescence will not be a problem as the networks can be upgraded remotely, in lieu of costly equipment upgrades.
As technologies and networking speeds become more advanced—moving to 4G speeds and beyond—providers and smart grid vendors will ensure that utilities’ networks are automatically upgraded in tandem. Smart grid networks will reap the benefits by allowing utilities to deploy the latest and greatest technology available at any given time without investing in any additional network equipment.
Instantaneous provisioning
One major benefit cellular networks have over proprietary smart grid networks is rapid connectivity. Once a utility plugs in a meter, the module connects to the system within minutes, and immediately becomes a live asset to utilities.
With larger proprietary systems, it can take months or even longer for the meter to go live. Cellular networks have enabled smart grid functionality (such as remote connects and disconnects) on the actual day of installation. Any time a utility builds their own network, they must go through an optimization phase. However, when utilities choose a cellular carrier, they are choosing a network that has already been optimized.
Major cellular network providers and their smart grid partners agree that the limited resources of utilities are best spent managing the power grid, not proprietary networks. The unprecedented opportunities of the smart grid should not result in utilities making quick decisions on technology investments intended to support growth over the next 15 years.
Owning a low-bandwidth, high-link connect solution may capture meter reads today, but it caps the utility at today’s functionality constraints over the long term, since it may not offer enough bandwidth to support future smart grid applications like electric vehicle charging. It may perform well by today’s standards, but without the freedom to upgrade easily, it constrains future performance.
While private networks will always have a place in the smart grid market, they face limitations, including technology obsolescence, interoperability issues, and cost inefficiency, which could threaten the long-term viability of a smart grid.
In short, as smart grid applications grow ever more robust, cellular networks are poised to become the preferred solution, as all major carriers are working together with solutions providers to maximize attributes like cost efficiency, bandwidth flexibility, coverage, security and network survivability for disaster preparedness. Cellular network technology has become cost competitive, providing an economical and scalable solution for smart grid deployments.
