

How could such a pervasive part of modern life still be so easily misunderstood?

Electricity is the invisible force at the very center of almost all the enabling technologies of our Modern world, and has filled this role for quite awhile now, so it might come as a surprise to many that it actually doesn’t operate anywhere near as well as it could, or should. In fact, this incredibly powerful and pervasive amenity has actually been under increasing pressure and burden as a result of its poorly aging design concepts that are based in distribution principals set down well over a century ago, and which are now are in dire need of upgrading.

By looking at some of the ‘Smart Grid’ or Grid 2.0 concepts that have been getting renewed attention of late, we see all sorts of progressive ideas to better deliver a product that already travels to the Customer at the speed of light, but that is currently still often getting managed and brokered via analogue links and mechanical switches, along distribution systems that were never really meant to accept power, rather than distribute it…and that’s just where the shortcomings begin.

Electricity is already a rather tricky commodity to supply, because it really isn’t a tangible ‘product’ to begin with…It’s more like a constant “line pressure” that jiggles back and forth 60 times a second, and needs to be maintained (in real time no less) up to a strict performance standard, despite unpredictable fluctuations in demand, and the notoriously slow reaction times of inter-grid transactions, and cumbersome ramp-up rates of generation capacity on the supply side. All of which is being provisioned via same basic transmission methods (albeit a lower voltage standard) that the Grid was based upon well over a century now.

If you think the challenges on the Supply side offer promising opportunities for optimization, then you’ll really be impressed by the gains that could be made on the Consumer end! But first, if electricity remains the de-facto standard for how energy gets transmitted and used to power Life as we know, and if we really expect to revolutionize (or at least properly upgrade) the way we distribute and use this ‘power’, then perhaps we need to consider the true nature, and price volatility of this artificially stabilized commodity. From there we could discover some of the new ways to optimize workflow in a 2.0 version of our old standard…

Pop-Open “GRID2.0: Why Upgrade?” if you’re not sure what the fuss is about

So let’s establish a baseline for electrical supply to begin…Electrical energy is clean, omnipresent, and requires very little thought or even basic understanding to use effectively, with no more expertise required than inserting foolproof plugs, and flicking a switch in most cases. It’s also considered a fact of life that is at our easy and economical disposal because it’s been so relatively cheap and plentiful for so long now…At least in the Western World. As such, most of us just take it for granted, and simply consume it indiscriminately and at will. As a result, we’ve never really needed to learn how to truly manage electric power effectively enough to become savvy Consumers, and at best only grasp the basics of conservation by relying on more energy efficient appliances to do the thinking for us. Most people can prove this subtle fact to themselves by staring at the cryptic dials on their household power meters to determine how much they really know about their own energy consumption habits. So basically, because electricity has been too easy, for too long, most of the Market would have to learn how to better manage its power consumption first, before taking the next step to becoming effective (micro) Producers/Suppliers someday…In order to realize the benefits of flattened hierarchies, and the peer-to-peer connections of an idealized Grid 2.0 based electricity market. But the prospects are compelling nonetheless…

So to get to an idealized Market that is fully responsive to sensors and other feedback mechanisms to enable a level of data and automation that would make the Electricity Market the living envy of every other commodity market on the planet…We still have to absorb and convert the basic motivating factors that exist to upgrade the grid. So even though Electricity makes our entire modern world go round, it remains a surprisingly misunderstood resource, that we’ve come to easily think of as a “product” that simply flows through lines of distribution like some sort of moving fluid that can be increased or decreased to meet demand at our end. Few of us realize that it can’t be warehoused and released later to meet spikes in demand, or just turned down when there isn’t enough to go around. Rather it’s more of a “pressure” that must be constantly maintained to strict technical standards, even if that means running a wasteful surplus to cover off the shortcomings of a dumb/mechanical distribution system! Al while also responding in real time to consumption and demand patterns (and spikes) by varying output in real time right back at its various sources. …and that just where the difficulties start!

Where Trouble Starts

Buyers expect a homogenized/stable price for electricity, but this shields them from the reality of the actual market.

Consumption (therefore demand) is very difficult to forecast, and even recurring daily patterns become unpredictable by the effects of (equally unpredictable) changes in temperature, cloud cover, or even television specials and industrial usage spikes.

Demand is completely insensitive to price/cost fluctuations, and exhibits virtually no price responsiveness – So people consume indiscriminately, and without regard to supply

Suppliers face strict and binding technical restrictions on production capacity during peak demand

This creates great differences between shortage and surplus levels, and further aggravates pricing volatility at the wholesale level

Regulators impose longer-term contract pricing to try and moderate this volatility, but this becomes a dis-incentive for investing in excess capacity, and hinders general market flexibility.

Storage has been prohibitively costly, and remains an uneconomical ideal .

Any significant mismatch between supply and demand could damage the entire system, and disrupt delivery of the product for EVERYONE through cascading failures!

So historically, it’s never really been possible (let alone practical) to store electricity on a large scale (to moderate supply/demand), rather than try to match demand in real time. So various forms of generation exist either for base-load requirements, or peak demand, and any shortcomings need to be bought at a premium either from neighboring utilities, or distant brokers. This difficult situation is being made even more obvious by the emergence of smaller renewable sources that wish to participate in the wider market, yet which cannot participate in a reliable or large enough capacity to overcome their built in cost disadvantage….Yet.

The upshot here is that these highly unpredictable renewable sources are making the shortcomings of our current systems plainly obvious to everyone, not just the engineers who’ve been fighting a losing battle to “upgrade” for decades now already. The rising costs of energy are also making marginal losses and inefficiencies within the old/current Grid more significant, which also adds to the argument to upgrade in terms that evey can understand…Direct Cost savings. There are many other exciting aspects of GRID 2.0 proposals as well that we will explore the next time, but in the meantime you might be curious about why our grid wasn’t built properly to begin with, and why it has been so difficult to start future-proofing long ago before we see started more widespread blackouts, as the system was pushed further and further past its aging limits. If you’re curious about how the Past created our Present situation, and how these lessons can help shape the Future you can consider: GRID2.0: Why Upgrade?

For those of you are are interested in the enormous power for Social Change that can be unleashed by changing the way we produce, distribute and consume electrical energy, we’ve also previously looked at the social challenges of Energy Policy, and realized that many of our most pressing societal issues and opportunities that we face as dependent Consumers of electrical power are actually reflections of the same types of issues that arise from corporate and human power structures. Except that this time we can entirely redefine these age-old problems through progressive new Energy Policy directions that

Consider the The Power of Social Change

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