Marc Lamey has been Vice-President Smart Grid Sales and Business Development of Alstom Grid since April 2011. In his role, Lamey is responsible for developing Alstom Grid's leadership in Smart Grid-ready management solutions. He spoke to Anoop K Menon on the technology enablers and trends within the smart grid market and the scenario in the Middle East. 

What are some of the key success factors behind smart grid projects?

Information Technology (IT) and telecommunications are the two mandatory technology enablers for the smart grid. But they are insufficient if you don't know how to manage your electricity flow. Smart grid, in essence, is proper knowledge and management of electricity flows using information and communication technologies. One piece alone cannot deliver, so you see ecosystems of companies in this sector. Also, one solution solving everything doesn't exist; that's why some of the early smart metering projects failed because they were not being used in a 'smart' way. While smart meters are a core component of the smart grid, it is important to have a clear idea on what you will do with the system. In fact, a long term road map for smart grid implementation is critical to its success.

What are Alstom Grid's strengths in the smart grid arena? How is smart grid changing the traditional approach to T&D?

Alstom Grid is number one worldwide in all activities relevant to the smart grid. We are leaders in control room IT for T&D utilities or what we call Energy Management Systems (EMS), Distribution Management Systems (DMS) and Market Management Systems (MMS). We are very strong in digital substation solutions which includes all intelligent systems (automated solutions and digital sensors) at substation level. We are also the largest player in High Voltage Direct Current (HVDC) transmission systems. In the Gulf region, the GCC Grid which uses HVDC technology was built by Alstom Grid.

There are many important angles to the smart grid. From the region's standpoint, a significant driver would be integrating renewable energy on the transmission side whereas in Europe, the focus is tilted towards the distribution side. The transmission network should be able to cope with the fluctuating nature of renewable energy.

The second angle is demand response where the objective is to incentivise consumers to adapt their energy consumption patterns to the utility's peaks. With demand response, we are limiting consumption with peak shaving and peak shifting which is the reverse of existing practice of generating more to meet spurts in demand. Utilities benefit from improved economies of scale and reduction in capex.

Today, the biggest market for demand response is the US where we are the market leader. However, Europe and Middle East too are starting to adopt demand response. Of course, regulation is the key driver in the former while in the latter, it is mainly ambition.

The third angle is substation automation led by numerical technology which is making inroads into primary electromechanical equipment after establishing itself in the secondary equipment. The use of optical fibre inside the primary equipment reduces the use of copper wiring which has a huge capex impact. At the same time, substation automation has a huge opex impact because you are able to monitor your equipment in real time and stretch them to the maximum of their design limits at a given point in time. It plays an important role in opex through optimisation of load capacity and management of the flows.

The fourth angle is distribution automation which has moved from the classical SCADA to very sophisticated applications like outage management, workforce management and technical applications like voltage control that are of added value for end-users when the distribution network gets constrained and when renewables are injected into the network.

Why has distribution automation become a key focus within the smart grid?

This topic has become important for different reasons. In Europe, the distribution system was less equipped compared to the transmission system and the network wasn't very constrained. However, the situation turned full circle due to massive injection of renewables into the distribution network triggering voltage issues and reverse flows on the transformers. Instead of usual top down flow, you had a real dynamic movement of electricity and if you don't control that, you just spoil your equipment and get a lot of reduction of KPIs like System Average Interruption Frequency Index (SAIFI) and System Average Interruption Duration Index (SAIDI.

While the driving force was renewables in Europe, in the US, it is aging of the distribution network and increasing frequency of bad weathers. It is not possible to revamp or renew their aging distribution network in a few years given that it took 60 years to reach the current level.  There are three other points to consider: One, control the distribution networks to their maximum limits; two, restore the networks after a big weather incident like storms or hurricanes and, last, the impact of demand response. To do demand response, you need to have certain level of equipment starting with smart meters and smart appliances. These act as sensors inside the network measuring the voltage, finding out whether the customer is load shedding or not and more. In the US, renewable energy is a lesser factor than in Europe because in the former, it is more about massive generation than distributed generation.

In your opinion, what is the scope for demand response in the region?

I believe that demand response has tremendous scope in the region from both commercial and retail perspectives. The first driver is the movement towards green energy in several countries in the Middle East; the second driver is the difficulty for some countries to achieve on their peak generation capacity over generation capacity for just a given point of time in their peak. Instead of burning oil and gas that could be exported you have a trade-off between what you are going to potentially burn versus what you could economise. The third driver is the capacity of storage to make peak shifting and reduce consumption. An example is water or ice-based thermal energy storage to provide cooling in green buildings.

In fact, we are working on several energy storage technologies. We have converters for very large battery systems in the network, similar to technology used in HVDC transmission networks. We are also working on Compressed Air Energy Storage and fly-wheel based storage.

You have been actively promoting Smart Grids in the region for the past few years. How would you rate the awareness quotient today?

Awareness has certainly improved and projects on the ground back that. We have carried out a smart grid pilot project in Kuwait for the Ministry of Electricity & Water and are in discussions with Abu Dhabi for a pilot; in Qatar, we have worked with KAHRAMAA to prepare their smart grid road map. To ensure network stability for transmission, we have developed and deployed Wide Area Monitoring System (WAMS) for the GCC Grid and for Bahrain as well, where we have also implemented an Integrated Distribution Management System (IDMS).

A key challenge for the region, going forward, is developing a regulatory framework to move from a pilot to a large scale project whether it is integrating renewable energy or implementing demand response. For example, in the case of demand response, incentive schemes will need to be in place. However, even in an advanced market like Europe, you still have regulatory issues. Without proper regulation and political guarantees, massive roll outs will always be constrained.  Moreover, each country is different. In Qatar, for example, they are going for full scale implementation of asset management and condition monitoring of equipment. With construction growing, T&D networks are also growing and optimisation is the need of the hour.

Looking outside the Middle East, how would you see the evolution of smart grid markets in North America and Europe?

The North American market is driven more by economic incentives than by regulation. Alstom Grid manages over 10GW of active demand response in North America which effectively substitutes 10GW of new capacity addition. Europe, as I said earlier, regulation is the main driver. The regulatory framework is not yet fully set up but that is going to change soon as the region has a much higher percentage of renewables hooked up to the T&D network compared to the US. We have done pilots with EDF and several other large utilities in Europe. In Denmark, we handle 50% of renewable generation mix while in Ireland, it is 35%.

© Power & Water Middle East 2013