The not-so-smart grid

What exactly are the standards for the next-generation utility grid? In many cases, nobody knows.

By Tam Harbert, Contributing editor -- EDN, May 25, 2010

Federal stimulus money has created a pressure cooker of standards development for the smart grid, and some companies might get burned.

The American Recovery and Reinvestment Act (ARRA) of 2009 doled out $4.3 billion for the smart grid, most of it for demonstration projects and existing deployments. Public-private matching funds are expected to bring total funding to $8.6 billion. The awards, to 100 different projects in 49 states, were announced last fall, priming the pump of an already growing market. Pike Research, a Boulder, CO-based market research company specializing in clean technology, forecasts that the smart grid infrastructure market, including advanced metering and demand-response systems, will more than triple over four years, from $10 billion in 2009 to $35 billion in 2013.

At the same time, ARRA gave about $10 million to the National Institute of Standards (NIST) to help it develop standards for the smart grid. Congress gave NIST responsibility for smart grid standards in 2007, but the ARRA obviously elevated the work in its importance and created a greater sense of urgency. What it did not do, however, was make it any easier. George Arnold, the national coordinator for smart-grid interoperability at NIST, has called the effort more complicated than developing standards for the Internet, a process that has taken 20 years and is still evolving.

Forecast for North American utility spending on smart grid
(hardware, software, and services) 

2008	$7.5 billion
2009	$10.7 billion
2010	$13 billion
2011	$15 billion
2012	$16.6 billion
2013	$17.6 billion
Source:	IDC Energy Insights

Meanwhile, the clock is ticking on the smart grid projects. The ARRA requires recipients to spend the stimulus money within three years. The count down creates a quandary for utilities that have to pick technologies today and puts pressure on technology vendors to keep to a minimum the behind-the-scenes drama that usually accompanies standards-setting.

"Many would argue that the cart has gotten a little ahead of the horse here, but there's nothing like a few billion dollars dangled in front of a bunch of vendors to get everybody to cooperate and play nice," said Bob Gohn, senior analyst at Pike Research.

Top everything off with the fact that success depends on cooperation between two industries whose cultures could hardly be more different. The utility industry moves slowly, at least partly because it's so heavily regulated. Its network dates back more than 100 years and typically uses closed, proprietary technologies. Suddenly, these staid companies are expected to open up those networks and choose among new-fangled technologies without even knowing for sure what those standards are going to be.

"It's got to be frightening for them," said Ravi Raju, vice president of corporate strategy at SmartSynch Inc., which makes smart meters and other grid infrastructure products. "Utilities are being placed in a position where there's a lot of money coming in from external sources - whether that's the federal government or private investment or whatever - and [they are] going to have to make some decisions today that affect their infrastructure for the next 10 to 20 years."

NIST blesses first group of standards

NIST's strategy is to rely on existing standards whenever possible and appropriate. In January, it published a report that identified an initial set of 75 standards. The report, "Framework and Roadmap for Smart Grid Interoperability Standards, Release 1.0," described its plan for developing additional standards and ensuring interoperability.

But only 25 of the 75 standards are actually approved by NIST, the other 50 require "further review," according to the report. And this is just the first step, covering the areas of highest priority for the development of the grid, said Marcus Torchia, research manager of intelligent grid strategies at IDC Energy Insights. In the next phase, already under way, NIST and the Smart Grid Interoperability Panel (SGIP), a group of more than 450 vendors, standards organizations, utilities and related companies, will perform interoperability tests on the 25 approved standards as well as try to resolve problems or conflicts in the other 50. The report singled out 15 areas for particular attention, creating Priority Action Plans (PAPs) for each. Groups of SGIP members are working on each PAP, some of which address standards battles and all of which have deadlines this year. PAP 15, for example, focuses on harmonizing power line carrier standards for appliance communications in the home, an area that HomePlug and HomeGrid have been fighting over for some time, said Gohn. "It's like, over the next week or so, let's solve the Palestinian-Israeli problem," he quipped.

While emerging standards duke it out, even the backers of well-established standards are making concessions in order to gain NIST's blessing. This is what prompted the ZigBee Alliance, for example, to finally embrace the Internet Protocol, said Gohn. "One of the overarching goals of the NIST standards is that they would be based on IP as the network layer protocol, and ZigBee initially was not," he said. But as they change the standard, they have to be careful to make sure that it will work as an upgrade for ZigBee chips in smart meters that are already deployed, he noted. Pike Research expects about 7 million advanced smart meters, most of which use the ZigBee interface for the home, to ship in North America in 2010. By the end of 2011, the installed base will be more than 20 million.

"That's one example of the little battles that are going on behind the scenes," said Gohn. And just one of the potential problems that loom because smart grid standards are lagging behind smart grid deployments.

Some vendors, however, see opportunity in the midst of all this uncertainty. SmartSynch is marketing a box called the GridRouter, which is based on Linux and supports IP-based services. It's designed to be a sort of translator among all the different proprietary protocols currently being used in the electricity grid. The product would not only help utilities transition from proprietary technology, said Raju, but might reduce the consequences of  betting on the wrong standard. Some of SmartSynch's customers have already found themselves in a pickle because they invested in smart-meter systems that don't support two-way communications, he notes.

The GridRouter "gives them some flexibility and mitigates those risks," he said. "So they don't have to take these huge chances on investments that a year from now don't meet the newly developed, or quickly evolving, requirements of the smart grid."