Electric utilities around the world are in the midst of unprecedented changes


Bill Althouse


There is now a decentralized system on the ground that enables utilities to integrate and manage conventional generators, including locally owned, ultra-efficient fossil-fuel generators, along with high amounts of renewable energy (RE), resulting in cleaner, cheaper and more reliable electricity. The ability to leverage Distributed Energy Resources (DER), storage and efficiency along the entire electric-power system value chain will define the future of the industry.


The municipal utility in Fort Collins, Colorado, made a home for a utility research and development center, FortZed, which has attracted many innovative companies such as Spirae, Inc., developer of what I call the “Genius Grid.” Denmark’s national, municipal utility has adopted this technology and is now operating the world’s first nationwide Genius Grid.


To understand how the Genius Grid works, let’s look at how the Internet was created. First, there was Arpanet, which used a few mainframe computers linked to a central-control protocol. The centralized control began to destabilize as more computers tried to connect. Large corporations that controlled Arpanet spent a fortune trying to maintain the centralized controls and bring more computers online. Arpanet cost $1,400 an hour, was very slow, and it was a one-way system—download only—and not affordable for a home computer. Then, some very smart people realized that the destabilization problem was caused by the centralized control itself. They devised the algorithms—HTML—to eliminate the centralized control, and the Internet was born. We now have computers at home that download and upload.


Power-grid engineers at Spirae were seeing a similar destabilization in Denmark’s grid, where many wind and solar plants were connecting to the power grid that used centralized “dumb” controls. Denmark passed a Feed-In Tariff (FIT), which mandated that any renewable generator has a “right” to connect to the power grid and that a very good price be paid for electricity it delivered. (FIT is now the most successful RE policy in the world; all of the countries that have large amounts of RE accomplished this by adopting FITs.) Because of the FIT, Denmark got so much RE, so fast, the grid was having serious stability problems. Spirae engineers, like the Internet’s creators, realized that centralized power-grid controls were the problem. They then developed an algorithm that allowed a power grid to operate without the need to centralize all controls, and they created the power Internet. Now, it is possible to connect any number of different kinds of generators to the grid with power flow that can go both ways, while having the highest power quality in the world.


Our current electrical system is only 29 percent efficient, wasting 71 percent of the energy in coal as heat at the power plant and as losses in the lines. If localized generators combined heat and power, delivering the heat and electricity, efficiency would be 90 percent, tripling the amount of energy delivered per fuel unit burned and cutting carbon dioxide (CO2) by 66 percent. These localized generators also provide the variable capacity to back up intermittent sources like wind and solar, allowing the possibility of very high RE percentages. Central power plants do not have the ability to ramp up and down to back up renewables, which is why utilities claim that solar and wind have high system costs.


The biggest barrier to deployment of this technology in the United States is the mandated Institute of Electrical and Electronics Engineers (IEEE) 1547 interconnection requirement for all combined heat and power plants, solar and wind. Generators are required not to help the grid when the grid needs help. They are prevented from improving power quality, even though most generators have power-conditioning capability. If the grid is of low-power quality, it is required to go off-line and stay off until the grid is back in range.


Transmission and distribution (T&D) in the electric industry has changed very little in the last 60 years. Now, we are hearing about “smart-grid” technologies. Currently, if we need more capacity, we have to pay to build a central power plant, pay for all the fuel it burns, pay to build the transmission system to ship the power, pay to build the distribution system to spread it around and pay for ancillary services, centralized controls and to stabilize the system. We then allow the utility to tack a profit on top of all this spending. With a Genius Grid, localized generators and demand response eliminate the need for new T&D lines because the power is already where it is used, with no shipping or spreading required. Also, the interconnect protocols require the localized generators to provide stabilization, greatly reducing the need for ancillary services. This means a reduction of 75 percent in the capital costs of new-system capacity and a dramatic drop in operating costs.


In the Genius Grid of Denmark, all generators are required to support the grid. The largest operating cost of a utility is power quality, but in Denmark it is provided at low cost by simply allowing independent generators to help when the grid needs help.


In the United States, most smart grids are about controlling and monitoring customers’ use of electricity with smart meters, but the centralized control of the grid and its centralized generators are not changed. The Genius Grid is an open highway for an unlimited array of distributed-generation and demand-response technologies that can eliminate the need for large-scale nuclear and coal power plants. The Genius Grid has made centralized power and transmission systems obsolete.


On some days, when energy consumption is low and sun and wind are strong, Denmark’s electricity use is 100 percent renewable, nationwide.


The Internet’s creation also caused a drop in costs from Arpanet’s $1,400 per hour at slow speed to today’s cost of $20 per month, high speed. The Genius Grid can do the same thing for our power costs.


Next time you hear the term smart grid, ask, “Smart for whom?” The smart grid, so far, has been smart for utilities but not so smart for the economy, the environment or the consumer’s pocketbook.


In Fort Collins, any municipal utility has the authority to use Genius Grid interconnections for local generators. Any community that wants smart power to benefit the local economy, the environment and the consumer’s pocketbook, should consider creating a municipal utility and deploying a Genius Grid. Santa Fe has conducted two feasibility studies of a municipal utility. The economic benefits of Genius Grid implementation should be added to these studies. The nonprofit Carbon Economy Series (CES) is facilitating cooperation between policymakers, business leaders, environmentalists and concerned citizens on this issue. Anyone who wants Santa Fe to have cheaper, cleaner and more reliable electricity should contact the CES (iginia@carboneconomyseries.com). CES is planning an educational tour of the Fort Collins laboratory with Spirae as host to help people understand the parameters of what it would take to transfer this technology to a public utility.



Economic localization advocate Bill Althouse is interested in the local production of energy and food.


Spirae Inc.’s website shows the technology it has developed at FortZed’s Integrid Lab: http://www.spirae.com/images/uploads/case-study/RDSI_Case_Study_September_2012.pdf and the deployment in Denmark. To read Denmark’s overview of the Genius Grid, visit http://energinet.dk/SiteCollectionDocuments/Engelske%20dokumenter/Forskning/Smart%20Grid%20in%20Denmark.pdf