Grid Reliability, Modernization, and Intelligence 2013 Annual Regulatory Studies Program © Joydeep Mitra, Ph.D. Electrical & Computer Engineering Michigan State University [email protected]  517.353.8528 Do not cite or distribute without permission

MICHIGAN STATE UNIVERSITY

Topics covered • • • • • • • • •

Grid reliability Reliability metrics NERC and Standards Grid modernization and the smart grid Smart grid benefits Environmental issues Integration of renewables Challenges and opportunities Concluding remarks

© Joydeep Mitra, IPU, 2013

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Grid reliability The North American Electric Reliability Corporation (NERC) defines two components of system reliability: • Adequacy – Having sufficient resources to provide customers with a continuous supply of electricity at the proper voltage and frequency, virtually all of the time. “Resources” refers to a combination of electricity generating and transmission facilities, which produce and deliver electricity; and “demandresponse” programs, which reduce customer demand for electricity. • Security – The ability of the bulk power system to withstand sudden, unexpected disturbances such as short circuits, or unanticipated loss of system elements due to natural or manmade causes. © Joydeep Mitra, IPU, 2013

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Some grid reliability metrics • Bulk power and distribution system reliability indices – Bulk power system reliability indices are based on average probabilities and frequencies of service interruption. In the distribution system, load point indices are used.

• Some bulk power system reliability indices – Loss of Load Probability (LOLP) • dimensionless

– Loss of Load Expectation (LOLE) • unit: hours/year

– Loss of Load Frequency (LOLF) • unit: failures/year

– Expected Unserved Energy (EUE) • unit: MWh/year © Joydeep Mitra, IPU, 2013

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Some distribution reliability indices • SAIFI: system average interruption frequency index total number of customer interruptions SAIFI = total number of customers served

• SAIDI: system average interruption duration index SAIDI =

total duration of customer interruptions total number of customers served

• CAIFI: customer average interruption frequency index total number of customer interruptions CAIFI = total number of customers interrupted

• CAIDI: customer average interruption duration index CAIDI = © Joydeep Mitra, IPU, 2013

total duration of customer interruptions total number of customer interruptions Camp 2013

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NERC Reliability Functional Model The NERC Reliability Functional Model provides the framework for the development and applicability of NERC’s Reliability Standards as follows: • The Model describes a set of Functions that are performed to ensure the reliability of the Bulk Electric System. Each Function consists of a set of related reliability Tasks. The Model assigns each Function to a functional entity, that is, the entity that performs the function. The Model also describes the interrelationships between that functional entity and other functional entities (that perform other Functions). • NERC’s Standards Development Teams develop Reliability Standards that assign each reliability requirement within a standard to a functional entity (that is defined in the Model and NERC's Glossary). This is possible because a given standard requirement will typically be related to a Task within a Function. A standard requirement will be very specific, whereas a Task in the Model will be more general in nature. • NERC's compliance processes require specific organizations to register as the entities responsible for complying with standards requirements assigned to the applicable entities. • The Model’s Functions and functional entities also provide for consistency and compatibility among different Reliability Standards. © Joydeep Mitra, IPU, 2013

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Functional Model diagram Source: NERC, “Reliability Functional Model”

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NERC standards − an introduction • Before the 2003 Blackout: – All Standards were regional – Most were not required Standards • Just recommended (optional) practices • Each region followed its own practice • NERC was largely an advisory body

Credit: I am grateful to Jim Lewis, Executive Engineer, Consumers Energy, for contributing to this and the next six slides. © Joydeep Mitra, IPU, 2013

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NERC: Council to Corporation • After the 2003 Blackout – FERC creates the Electric Reliability Organization (ERO) – NERC is appointed ERO – FERC creates Functional Model – NERC and Regions create Enforceable Standards – Regions Consolidate

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What is in the standards • Introduction – Title, number, purpose, applicability, effective date

• Requirements – What you have to do – Number varies from 3 to about 25

• Measures – What you need to do to demonstrate compliance with each Requirement – Every Requirement is covered by a Measure

• Compliance – Monitoring Authority, Period, and Process – Data Retention © Joydeep Mitra, IPU, 2013

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Example – Requirements (CIP) B. Requirements R1. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall have procedures for the recognition of and for making their operating personnel aware of sabotage events on its facilities and multi-site sabotage affecting larger portions of the Interconnection. R2. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall have procedures for the communication of information concerning sabotage events to appropriate parties in the Interconnection. R3. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall provide its operating personnel with sabotage response guidelines, including personnel to contact, for reporting disturbances due to sabotage events. R4. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall establish communications contacts, as applicable, with local Federal Bureau of Investigation (FBI) or Royal Canadian Mounted Police (RCMP) officials and develop reporting procedures as appropriate to their circumstances. © Joydeep Mitra, IPU, 2013

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Example – Measures (CIP) C. Measures M1. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall have and provide upon request a procedure (either electronic or hard copy) as defined in Requirement 1. M2. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall have and provide upon request the procedures or guidelines that will be used to confirm that it meets Requirements 2 and 3. M3. Each Reliability Coordinator, Balancing Authority, Transmission Operator, Generator Operator, and Load Serving Entity shall have and provide upon request evidence that could include, but is not limited to procedures, policies, a letter of understanding, communication records, or other equivalent evidence that will be used to confirm that it has established communications contacts with the applicable, local FBI or RCMP officials to communicate sabotage events (Requirement 4). © Joydeep Mitra, IPU, 2013

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Example – Compliance D. Compliance

1. Compliance Monitoring Process 1.1. Compliance Monitoring Responsibility Regional Reliability Organizations shall be responsible for compliance monitoring.

1.2. Compliance Monitoring and Reset Time Frame

– One or more of the following methods will be used to verify compliance: – Self-certification (Conducted annually with submission according to schedule.) – Spot Check Audits (Conducted anytime with up to 30 days notice given to prepare.) – Periodic Audit (Conducted once every three years according to schedule.) – Triggered Investigations (Notification of an investigation must be made within 60 days of an event or complaint of noncompliance. The entity will have up to 30 days to prepare for the investigation. An entity may request an extension of the preparation period and the extension will be considered by the Compliance Monitor on a case-by-case basis.) The Performance-Reset Period shall be 12 months from the last finding of noncompliance. © Joydeep Mitra, IPU, 2013

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Standards – concluding remarks Enforcement • All Approved NERC Standards are enforceable • Fines can be quite large • Repeated violations could lead to suspension of the ability to perform the function For more information: • Web site: www.nerc.com • Use Standards Tab to get the – – – –

Functional Model Complete approved Standards Glossary Standards under development

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Smart grid or smarter grid? • Today’s grid is very complex and very smart, with highly sophisticated features: – Monitoring and control for normal operation; – Protection from abnormal conditions.

• Adding advanced communication and information technologies will increase system-wide awareness and enhance performance in several areas: – Higher efficiency; – Higher resilience (reliability, security, automated recovery); – Lower consumption of fossil fuels (coal, oil, natural gas); – Lower pollution (oxides of carbon, sulfur and nitrogen; solid particulates). © Joydeep Mitra, IPU, 2013

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Title XIII (Energy Independence & Security Act 2007) • Increased use of digital information and controls technology. • Optimization of grid operations and resources, with full cyber-security. • Deployment and integration of distributed resources and generation, including renewable resources. • Incorporation of demand response, demand-side resources, and energy efficiency resources. • Deployment of “smart” technologies for metering, communications concerning grid operations and status, and distribution automation. • Integration of “smart” appliances and consumer devices. • Deployment and integration of advanced electricity storage and peakshaving technologies, including plug-in electric and hybrid electric vehicles, and thermal-storage air conditioning. • Provision to consumers of timely information and control options. • Development of standards for communication and interoperability of appliances and equipment connected to the electric grid. • The lowering of unreasonable or unnecessary barriers to adoption. © Joydeep Mitra, IPU, 2013

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The smarter grid: a cyber-physical system • The “Cyber” layer is a connected system of computers for – Data acquisition – Decision making – Supervisory control of the “physical” layer

• The “Physical” layer is the electric grid, an interconnected system of – Generation and storage – Transmission and distribution – Loads Measurement data collected by meters and synchrophasors are communicated to the “cyber” layer © Joydeep Mitra, IPU, 2013

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Scope of smart grids • The delivery infrastructure (e.g., transmission and distribution lines, transformers, switches) • The end-use systems and related distributed-energy resources (e.g., building and factory loads, distributed generation, storage, electric vehicles) • Management of the generation and delivery infrastructure at the various levels of system coordination (e.g., transmission and distribution control centers, regional reliability coordination centers, national emergency response centers) • The information networks themselves (e.g., remote measurement and control communications networks, inter- and intra-enterprise communications, public Internet) • The financial and regulatory environment that fuels investment and motivates decision makers to procure, implement, and maintain all aspects of the system (e.g., stock and bond markets, government incentives, regulated or non-regulated rate-of-return on investment). © Joydeep Mitra, IPU, 2013

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Smart grid benefits • To utilities – Higher reliability – Higher security – Higher asset utilization and deferred capital spending – Reduced operation and maintenance costs – Efficient power delivery

© Joydeep Mitra, IPU, 2013

• To customers – Consumption management and cost savings – Ability to connect DG – Convenience from advanced meters – Enhanced business consumer service – Reduced industrial consumer cost

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Potential benefits 2000 Parameter

2020

Baseline Business As Usual (BAU)

Enhanced Productivity

Improvement of Enhanced Productivity Over BAU

Electricity Consumption (billion kWh)

3,800

5,400

4,900 – 5,200

5 – 10% reduction

Delivered Electricity Intensity (kWh/$GDP)

0.41

0.33

0.27

20% reduction

Carbon Dioxide Emissions (million metric tons of C)

590

790

590 – 690

13 – 25% reduction

Worker Productivity Growth Rate (%/year)

2.5

2.0

2.5

25% increase

9,200

16,500

18,300

10% increase

100

200

25

87% reduction

Real GDP ($billion 1996) Cost of Power Disturbances to Businesses ($billion 1996) Source: EPRI, Energy Future Coalition © Joydeep Mitra, IPU, 2013

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Higher reliability and security • Better situational awareness • Ability to determine intrusion attempts • Anticipating and responding to system disturbances • Dynamic rating of transmission capacity • Automated fault location • Distribution automation • Reduced down times and customer interruption costs • Self-healing ability © Joydeep Mitra, IPU, 2013

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Customer interruption costs Industry Cellular communications Telephone ticket sales Airline reservation system Semiconductor manufacturer Credit card operation Brokerage operation

Average cost of one hour’s interruption $41,000 $72,000 $90,000 $2,000,000 $2,580,000 $6,480,000

Source: Galvin Energy Initiative, “Fact Sheet: The Electric Power System is unreliable.” © Joydeep Mitra, IPU, 2013

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Higher asset utilization • Demand response programs and real-time or tiered pricing reduce peak demand, which – Improves capacity factor – Permits more economic operation – Allows deferral of capital expenditure on generation, transmission and distribution assets

• The following smart grid benefits also result in higher asset utilization and allow investment deferral – Dynamic rating of equipment – DG integration – Higher operational efficiency © Joydeep Mitra, IPU, 2013

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Reduced operation and maintenance costs • Remote, automated connections and disconnections • Remote metering • Near real-time remote asset monitoring (e.g., overload sensing) • Condition-based maintenance • Detection of pilferage

© Joydeep Mitra, IPU, 2013

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Efficiency gains • Wide area monitoring can result in better optimization of both generation and transmission operation • Optimizing asset utilization results in efficient operation • A study by Excel Energy indicates potential reduction in distribution losses of up to 30% from optimal power factor performance and system balancing © Joydeep Mitra, IPU, 2013

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Consumer services • Communication of price and other signals • Time of use pricing – Cost savings to consumers – Peak reduction, economic operation and better asset utilization for utilities

• Improved billing and complaint management • Industries using motors in processes can benefit from improved control of motor loads and price signals © Joydeep Mitra, IPU, 2013

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Technology: smart transmission system • Technologies in transmission systems – Phasor measurement units (PMU) / synchrophasors – Flexible ac transmission systems – Dynamic rating of transmission equipment

• Monitoring and control – System state (voltages, service status) – Component loading and configuration

• Requirements and challenges – – – –

Very complex and widespread communication network Enormous data management and optimization capability Highly complex control Operator interface

© Joydeep Mitra, IPU, 2013

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Technology: smart distribution system • Technologies in distribution systems – – – –

Advanced metering infrastructure (AMI) Distribution automation Demand response / smart home / smart appliances Plug-in hybrid electric vehicles (PHEV) / vehicle to grid (V2G) interfaces

• Must enable – Automated sensing, protection and restoration – Demand management and price signal communications – Increased penetration of distributed resources and power electronic devices

• Challenges include – Complex communication and data management – Investment cost control: distribution system components are much more numerous than transmission system components © Joydeep Mitra, IPU, 2013

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Technology: smart appliances in the home • “Smart” appliances respond to price signals, resulting in several cost saving opportunities: – They can operate during off-peak, low price periods – Refrigeration, water heating and HVAC systems can benefit from longer “on times” during off-peak periods – Operation of appliances and heating / cooling systems can be staggered, resulting in peak reduction for utilities

• Consumers adopting these technologies end up using more efficient and environmentally friendly appliances © Joydeep Mitra, IPU, 2013

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Role of plug-in hybrid electric vehicles

Source: US DoE, “Regulators: What the Smart Grid Means to You and the People You Represent” © Joydeep Mitra, IPU, 2013

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The environmental story: EPRI prism

Source: EPRI: Prism/Merge Analyses 2011 © Joydeep Mitra, IPU, 2013

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Integration of renewable resources • Wind Energy – Not well correlated with load – Variability and unpredictability cause challenges in coordination with dispatchable generation – Low capacity value

• Solar Energy (Photovoltaic and Solar Thermal) – Better correlation with load but not available at night – Less variability – Thermal storage a possibility with solar thermal

• Storage helps considerably, but is expensive © Joydeep Mitra, IPU, 2013

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Variability: mitigation and cost • Options for variability mitigation – Storage – Exploitation of geospatial diversity – Control of curtailable loads

• Technology and cost – Storage is expensive – Exploitation of geospatial diversity requires significant (and costly) transmission upgrades – Need “smart grid technologies” to monitor and control © Joydeep Mitra, IPU, 2013

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Interoperability challenge “Interoperability is the capability of two or more networks, systems, devices, applications, or components to share and readily use information securely and effectively with little or no inconvenience to the user.” (GridWise Architecture Council) • Several communication technologies and protocols; several vendors • Integration with “legacy” systems • Addressed through standards: IEEE P2030; IEEE C37.118; IEC 61850; IEC 61970/61968; many others. © Joydeep Mitra, IPU, 2013

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Cybersecurity challenge Cybersecurity deals with hardening the information and communication layer against malicious (hack) attacks. • Numerous devices talking to each other; not all of them have high processing capability or robust and secure software • Use of firewalls, encryption and authentication protocols • Several standards: ISO/IEC 27002; ISO 15408; NIST 800-12, -14, -26; NERC CIP-002-1 through CIP-009-2; RFC 2196. © Joydeep Mitra, IPU, 2013

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Summary and concluding remarks • Reliability and security have emerged as important challenges in the modern grid. The NERC has been developing numerous standards, monitoring and compliance procedures to promote reliability and security. • There is a large-scale ongoing effort to modernize the grid. The bulk of the modernization effort is directed toward designing and deploying a wide-area monitoring, control and communication infrastructure. • Another large-scale ongoing effort focuses on integrating renewable energy resources. This involves several complex challenges. • The grid modernization effort is a complex and expensive process that requires thoughtful regulation, investment and implementation, as well as education of stakeholders. © Joydeep Mitra, IPU, 2013

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