How the Smart Grid Will Work

To understand the value of the smart grid transition, you first have to grasp some of the key problems with the current system. Today's power grid, though overburdened, is actually quite reliable. It allows areas to share electrical resources in order to keep everyone's circuits flowing. Moving forward, however, the system must evolve to keep pace with modern technology and maintain sustainability.

Properly distributing power through the grid is a sort of juggling act. Power usage in a given area fluctuates depending on time of day and season of the year. If temperatures rise and more people turn on their air conditioners, then the area as a whole requires more power. But since power plants can only put out so much energy, sometimes the juggling act fails. In the past, the only way to address this problem was simply to expand the grid and build more power plants, which elevates electricity costs.

If you find yourself dropping balls while juggling, then one possible solution is to become a better juggler. The DOE attributes many major and regional blackouts to slow response times and poor visibility -- shortcomings effectively addressed through automated systems and a streamlined system of distributing power. As it is, the U.S. power grid relies on a centrally planned and controlled infrastructure. The juggler is overtaxed, and we keep throwing new balls into the mix.

These blackouts cost individuals and businesses millions. Not only would a more efficient system sidestep many of the potential outages, but it could also do wonders for the environment. The DOE estimates that if the grid were merely 5 percent more efficient, the energy savings would equal the fuel and greenhouse emissions from 53 million cars. As the United States accounts for 25 percent of the world's greenhouse emissions, this change could go a long way toward reducing the effects of climate change.

Finally, there's security to consider. The grid's centralized structure also provides a tantalizing target to anyone wanting to do something to it. Additionally, since other areas of the grid pick up slack for underperforming sections, one strategic hit could also set off a domino effect.

To address the problems discussed in the previous section, the U.S. Department of Energy plans to unroll a less centralized, producer-interactive network. Naturally, no single fix can accommodate this change. Numerous concepts, philosophies and technologies go into steering the system to a more efficient future. Here are two of the big ones.

Advanced metering infrastructure (AMI): This is one aspect of the smart grid that you can already find in many homes and businesses. The aim is to take the mystery and guesswork out of personal energy consumption. Instead of just waiting for the bill or staring dumbfounded at the spinning dials on the power meter outside, users can now use wattage readers to check how much juice their appliances and gadgets use. In the future, this concept may go even further. Imagine checking the thermostat and watching price figures tick by. How might that affect your decision to crank the heat on a chilly evening? Giving users more information about the power they use empowers them to fine-tune their own conservation to cut out unnecessary waste.

Visualization technology: Think back to the juggler analogy. This is the smart grid juggler of the future: an automated computer system capable of instantly responding to the ebb and flow of energy production and demand across the grid. The DOE cites one project in particular: Oak Ridge National Laboratory's Visualizing Energy Resources Dynamically on Earth (VERDE) system, built on the Google Earth platform. In addition to VERDE, the DOE plans to use Phasor measurement units (PMU) to keep precise tabs on electrical usage throughout the smart grid and take the guesswork out of supplying adequate power.

If all goes according to plan, these two approaches will lead to a situation where both the user and the automated distributer of the electricity have far more information -- and therefore power -- over the flow of electricity. This, in turn, allows for more responsible expenditures all around -- from power generation plants to the home entertainment center at the end of the line.

The smart grid isn't something you can expect to simply wake up to and find working in your home. And, unlike the United States' 2009 switch from analog to digital television, a government voucher and a trip to your local Wal-Mart won't be enough to make it happen, either. There are many baby steps on the road to a better, more sustainable power system. Here are just a few of them:

Smart meters and thermostats: As of July 2009, these updates on traditional power meters and thermostats had made their way into 8.3 million U.S. homes [source: Merchant]. The meters provide both the user and the electrical grid with more detailed usage information. Smart thermostats are programmable and WiFi equipped to keep track of the weather forecast. These features allow for a more fine-tuned and efficient use of home heating and cooling.

Engaged users: The human element is essential to any conservation movement and the smart grid is no exception. This entails better educating the public about the personal and overarching benefits of energy conservation in the home.

Optimized power plants: As the smart grid takes shape, the automated system will allow for a more concise juggling of resources. Having a deeper, real-time understanding of energy needs is like knowing exactly how many guests you have coming dinner. Without as much guesswork, you pare down the grocery list without fear of anyone going hungry -- or powerless. This also allows power plants that can be harmful to the environment to take a backseat to cleaner, renewable sources.

Renewable Energy: The seamless integration of renewable energy sources is an important part of smart grid integration. Fossil fuel-burning and hydroelectric power plants won't disappear, but wind farms and solar cells will provide an increasing share of the overall power generation for a given area.

State and Federal Regulations: Needless to say, law and politics plays a huge role in the operations of the existing power grid. The smart grid transition, therefore, naturally involves steady action at both levels. A number of states have already adopted renewable energy portfolio standards to promote renewable energy. Meanwhile, a number of regulations to support necessary laws and technological advances continue to advance through federal channels.

The DOE plans to forge the smart grid out of both large and small innovations. In the future, new technologies such as thermal storage, improved lithium-ion batteries and superconducting power cables will further expedite the process.

Explore the links on the next page to learn how these changes will affect your life.