MISO Delivers Billions in Benefits to Region

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The Midwest Independent System Operator Inc. (MISO) announced its annual value proposition study, which details between $2.2 billion and $2.7 billion in quantitative benefits that MISO provided for the region in 2011. The regional transmission organization provides these benefits through its ongoing grid reliability and efficiency measures.

The annual value proposition study was created in 2007 to quantify the value MISO provides to the region, including MISO market participants and their customers. The value proposition study does not calculate the value for any individual market sector or state. For 2007 through 2011, these studies revealed that the MISO region realized between $4.3 billion to $5.7 billion in cumulative savings.

"MISO's value proposition continues to affirm our commitment to deliver the greatest benefits to end users, our members and potential members through a collaborative, regionwide approach to grid planning and management," said John R. Bear, MISO president and CEO. "This study breaks down and analyzes hard data to show exactly how those savings occur."

The study identifies $2.2 billion to $2.7 billion in economic benefits delivered to the region in 2011 from:

  • Improved reliability (which totals between $320 million to $479 million),
  • Market commitment, dispatch of energy, regulation and spinning reserves (which totals between $426 million and $470 million),
  • Wind integration (which totals between $163 million and $196 million),
  • Compliance (which totals between $62 million and $93 million), and
  • Generation investment deferral (which totals between $1.4 billion and $1.7 billion) that includes footprint diversity, generator availability improvement and demand response.

The addition of compliance as a quantitative benefit was a new component in the 2011 analysis. In its role as a balancing and planning authority, MISO performs many compliance activities that otherwise would fall to its members to complete. These efforts alone save members between $62 million and $93 million annually. In addition to quantitative benefits, MISO continues to demonstrate significant qualitative benefits for its wholesale market participants including price and informational transparency, planning coordination and seams management.

MISO site: http://misoenergy.org


ERCOT: Nearly $8.7 Billion in Transmission Projects Planned in Next 5 Years

The Electric Reliability Council of Texas (ERCOT) plans nearly $8.7 billion in transmission improvements in the next five years, the state grid operator and wholesale electric market manager revealed in its annual transmission report.

The planned projects are expected to improve or add nearly 7,000 circuit miles of transmission lines and more than 17,000 megavolt amperes (MVA) of autotransformer capacity to the grid, including the Competitive Renewable Energy Zones (CREZ) transmission additions that are scheduled to be in service by 2013.

"The 2011 Electric System Constraints and Needs Report" filed in January with the public utility commission (PUC) identifies existing and potential constraints in the transmission systems that pose reliability concerns or might increase costs to the electric power market and Texas consumers.

Since 2010, ERCOT transmission providers have completed construction and improvements to some 966 miles of transmission and more than 5,000 MVA of autotransformer capacity at an estimated capital cost of $870 million. The largest project completed in 2011 was a 173-circuit mile 345-kilovolt (kV) line in South Central Texas, the Zorn/Clear Springs–Gilleland Creek–Hutto Switch.

As the transmission-planning coordinator for the region, ERCOT works with the region's transmission and distribution providers and other stakeholders to identify the need for new transmission facilities based on engineering analysis of operational results, load forecasting, generation interconnections and transmission and system studies. As part of the planning process, ERCOT seeks input from all market participants and stakeholders about options and possible solutions through the ERCOT-led regional planning group. Major projects also must be endorsed by the ERCOT board of directors.

In the ERCOT region, the cost for transmission construction and upgrades is rolled into costs that all ratepayers pay, also known as a postage-stamp transmission rate because it is the same access fee regardless of location. Transmission and distribution providers must offer access to their wires to all electric providers on a nondiscriminatory basis. The PUC regulates transmission and distribution providers and approves the rates they are allowed to charge for the delivery of power to retail customers.

ERCOT's transmission snapshot consists of 40,530 miles of high-voltage transmission, which includes 9,249 miles of 345-kV, 19,565 miles of 138-kV and 11,715 miles of 69-kV. The $8.7 billion under development resides in a five-year plan, including some $5 billion to support 18,000 MW of renewable generation. More than 8,500 circuit miles of transmission improvements have been made since 1999, and some $6.6 billion in transmission improvements have been added since 1999.


Con Edison Selects Siemens, Tibco to Provide Smart Grid Integration Solution

Siemens' smart grid division and Tibco Software Inc. will provide smart grid enterprise integration services to Consolidated Edison (Con Edison) for a smart grid demonstration project. The project is a result of Con Edison Co. of New York's receiving Department of Energy funding through the American Recovery and Reinvestment Act (ARRA).

Siemens and Tibco will provide a fully integrated and secure smart grid solution for Con Edison using standards-based software and technologies. In collaboration with Siemens and Tibco, Con Edison will strive to improve smart grid reliability and provide customers with greater visibility, flexibility and value to enhance control capabilities for existing smart grid assets, manage daily system peaks via demand response, and determine how to apply developing technologies best.

"We are proud to share our extensive integration experience with Con Edison in an effort to provide them with a cost-effective and proven integration solution," said Thierry Godart, president of Siemens' smart grid division in the United States. "Our integration offering has been refined through years of experience to provide our customers with innovative and secure smart grid solutions."

Con Edison uses Tibco's enterprise messaging technology to gain a scalable, interoperable integration framework enabling the real-time flow of information across deployed assets for enhanced decision-making capabilities to maintain a healthy power infrastructure. Siemens will add smart grid visualization capabilities, providing a lightweight, browser-based user interface.

"This project marks our dedication to providing safe, reliable and efficient energy to our customers by enhancing our systems' capabilities," said Patricia Robison, Con Edison project manager. "We look forward to Siemens' and Tibco's expertise in helping us meet our smart grid project objectives."

Siemens' and Tibco's smart grid integration and methodology expertise will enable Siemens to help Con Edison deploy the functionality and technology proposed for the smart grid demonstration project.

"New York is home to one of the most critical finance infrastructures in the world and the most pervasive big-building management systems," said Murat Sonmez, Tibco executive vice president of global field operations. "The ability to use real-time data to manage system assets, detect early warning signs and act immediately to resolve potential problems before they occur is necessary to maintain predictable power and help keep businesses running. With Tibco and Siemens, Con Edison is developing an architecture that will result in use cases that can act as a blueprint for other urban areas."

Implementation of the smart grid integration solution began in August 2011. The project is estimated to be completed in May 2013.


What Does Grid Modernization Mean for the Economy and Job Growth?

By Farah Saeed, Frost & Sullivan Principal Consultant

As the industry continues to discuss smart grid solutions best suited to address issues on power quality and availability, there is another important motive to consider. The impact on the overall economic health of cities across the U.S. is a critical factor when moving forward with grid modernization strategies During DistribuTECH 2012, experts discussed best practices performed by municipalities that are promoting their cities' prosperity by upgrading the electric power distribution system.

Today, almost every major investor owned utility (IOU) in the U.S. is modernizing, or planning to modernize, its existing power distribution or transmission system or both. This is happening to prepare for expected changes, such as the adoption of renewable power and electric vehicles. Smart grid is expected to mitigate issues related to power fluctuations that might occur due to the presence of aforementioned products. These motives also hold true for municipalities. However, many are also recognizing additional benefits such as improving overall quality of life and attracting new businesses to their locations.

The Electric Power Board (EPB) is an example of a utility that, as a result of its wise technology investments, has turned around its fortune in its city of Chattanooga, Tenn. The utility matched the smart grid grant it received from the federal stimulus plan to deploy 170,000 smart meters, through which it intends to curtail energy usage during peak power periods. A major achievement for the city and municipality has been the build-out of its fiber optic network system, which allows the city to offer high speed Internet access to its residents, as well as improve connectivity and visibility across the electric grid. This in return lets the municipality react faster to outages and other issues. The utility is already witnessing a 40 percent outage reduction as well as significantly improved power availability by deploying intelligent switches offered by the S&C Electric Co. The prospect of improved power availability has led companies such as Volkswagen to announce the building of its headquarters in Chattanooga. Furthermore, Amazon.com has chosen the city to build its new distribution center. Both projects are set to promote economic prosperity in the city.

Silicon Valley Power (SVP), a municipality based in Santa Clara, Calif., is about to deploy advanced meter infrastructure (AMI) in its community. The project is referred to as SVP Meter Connect. This communication network infrastructure deployed for AMI has multiple purposes, however, and also will be used for connecting its mobile workforce, including its police and fire departments, among others. Currently, 91 percent of the utility's revenues are generated from commercial and industrial customers. Customers include National Semiconductor, Intel, Applied Materials, NVIDIA and Yahoo. Investments for improving the electric power distribution system will help the utility detect and pinpoint outages in the distribution area within a few minutes of a fault occurring, guaranteeing that businesses can continue operations with as few interruptions as possible.

CPS Energy, a municipality based in San Antonio, Texas, has rolled out New Energy Economy initiatives aimed at creating jobs and local manufacturing in its city, along with energy planning. The city expects to generate $40 million in payroll by attracting clean energy businesses due to its own investment in grid modernization, which includes smart meters and home energy management systems deployment, as well as the adoption of solar power and substation upgrades. Clean tech companies investing in the city include Consert, Greenstar, SunEdison, Summit Power Group, and Cold Car USA, among others. The municipality has ambitions to become a model smart city for the nation.

Developments such as these show that in times of continued economic uncertainty, progressive, community-owned utilities that recognize the long term benefits of making smart grid investments exist to promote the overall economic health of their cities. Strategies such as these are contributing to a healthy and steadily growing smart grid market. Frost & Sullivan research shows that smart grid technology sales in North America grew approximately 26 percent in 2010 and are projected to grow at a compound annual growth rate (CAGR) of 11.5 percent between 2010 and 2017.


Itron Stock Soars on Q4 Numbers, SmartSynch Acquisition

The stock market likes Itron Inc (ITRI.O).

The king of North American smart meter makers on Feb. 15 announced plans to purchase its privately held cellular partner of more than 10 years, SmartSynch, for $100 million. The companies expect to close the deal in the second quarter of 2012.

The news came on the same day Liberty Lake, Wash.-based Itron posted fourth-quarter numbers that trumped expectations. Itron posted an adjusted profit of $1.19 a share on a revenue of $642.5 million. Wall Street analysts expected earnings of 99 cents a share on a revenue of $582.14 million.

"SmartSynch is a compelling strategic acquisition that strengthens our position in the industry and with our energy and water utility customers," said LeRoy Nosbaum, Itron president and CEO. "SmartSynch brings a highly complementary technology to our existing communication network offering, broadens our portfolio and enhances Itron's ability to support our customers with their smart grid projects."

Within 24 hours of the news, Itron stock gained as much as 26 percent. Itron shares closed at $40.11 on the day of the announcements on the Nasdaq. Shares hit a six-month high of $48.80 the following day.

Itron expects to gain some $50 million in annual revenue after the acquisition. SmartSynch, headquartered in Jackson, Miss., has more than 130 customers, including nine of the top 10 utilities in North America. Itron and SmartSynch's technologies are seen as complementary and can be used to provide a solution in areas where radio frequency mesh networks are not available or are cost-prohibitive. In addition, SmartSynch's technology is designed to meet the needs of full cellular smart grid network deployments, such as the 1.9 million electric residential and commercial and industrial meter end-point deployment at Consumers Energy.

"Utility customers are demanding more options and this is a combination that just makes sense," said Stephen Johnston, SmartSynch CEO. "Our companies share existing customer relationships, integrated technologies and a common culture that will enable us to pursue new opportunities. Itron's diversified portfolio, combined with our cellular technology, makes us the best team in the business going forward."

Itron's competitors in the United States include General Electric Co , Badger Meter, Cooper Industries, Emerson Electric Co., ESCO Technologies Inc. and Roper Industries Inc.


WIRES Welcomes Sunflower Electric Power Corp.

Sunflower Electric Power Corp., a generation and transmission cooperative based in Hays, Kan., has become a full member of the Working Group for Investment in Reliable and Economic Electric Systems (WIRES), continuing and expanding the representative nature of WIRES' membership, according to the organization.

Sunflower Electric Power is a consumer-owned, not-for-profit corporation and owned by six rural electric distribution cooperatives that, along with its sister company Mid-Kansas Electric Co. LLC, serve 55 central and western Kansas counties. Formed in 1957, Sunflower is a member of the Southwest Power Pool, an associate member of WIRES.

Wholesale power is delivered across a high-voltage transmission network consisting of 76 substations and some 2,300 miles of 69-kV, 115-kV and 345-kV line.

"Sunflower is a prominent cooperatively owned G&T in mid-America," said Jim Hoecker, WIRES counsel and former chairman of the Federal Energy Regulatory Commission. "Sunflower's membership in WIRES shows that all segments of the power business can join together in promoting better policies and practical approaches to improving electric infrastructure. It bears repeating that an upgraded and expanded transmission network will provide benefits to a wide variety of transmission customers and that the benefits of well-planned transmission expansions and upgrades will exceed costs, especially over the life of these critical assets."

Sunflower looks forward to working with WIRES, said Stuart Lowry, Sunflower president and CEO.

A robust transmission system, Lowry said, "will enable us to continue our cooperative mission of providing our members with reliable energy at the lowest possible cost."


EYE ON THE WORLD

Russian Utility Installs 3M ACCR to Upgrade Moscow Transmission Line

Russia's largest interregional distribution grid company has installed the 3M ACCR overhead conductor to upgrade a line serving a densely populated southern district of Moscow to avoid the need for larger towers or an expanded right-of-way.

Moscow United Electric Grid Co. ( MOESK Co.) serves a 47,000-square-kilometer (18,147-square-mile) area with a population of about 17 million. The installation is the second application of 3M ACCR by MOESK in Moscow and the eighth across the country by a Russian utility. Three more will be completed soon.

The utility chose 3M ACCR to achieve up to 1,200 amperes of current on a 3.3-kilometer (2.05-mile) 110-kV double-circuit overhead segment of its Cheremushki-Yughnaya line serving the Nagatino-Sadovniki portion of Moscow's Southern Administrative District.

The alternative solution would have been to enlarge the towers to support a 220-kV or 330-kV upgrade, causing difficult logistical problems in the densely packed community. Among other impediments, the line crosses six-lane and eight-lane highways, as well as railroad tracks.

3M ACCR is a lightweight, low-sag, high-capacity conductor that can carry twice the current or more of conventional steel-core conductors of the same diameter on existing towers, thereby helping utilities avoid a wide range of problems in environmentally sensitive areas and crowded urban settings. Its low-sag characteristic also provides a solution for clearance issues.

3M ACCR was developed with the support of the U.S. Department of Energy, which tested the conductor at its Oak Ridge National Laboratory (ORNL) in Tennessee, and with early contributions by the Defense Advanced Research Projects Agency. The ORNL tests demonstrated that the conductor retains its integrity after exposure to temperatures even higher than the rated continuous operating temperature of 210 C and the emergency operating temperature of 240 C. It has the durability and longevity of traditional steel-core conductors, even when operated continuously at high temperatures.

The conductor's strength and durability result from its core, composed of aluminum oxide (alumina) fibers embedded in high-purity aluminum using a highly specialized and proprietary process. The constituent materials can withstand high temperatures without appreciable loss in strength, even over long periods.

Also, because 3M's ACCR is based on aluminum, it has the corrosion resistance typically associated with aluminum-based conductors.


Global Industrial Shift Boosts Demand for T&D Infrastructure

The increasing demand for electricity in emerging economies as a result of the relocation of industrial activity to regions such as China, India, Eastern Europe and Latin America will increase investment in the power transmission and distribution (T&D) sector, a new report by business intelligence specialist GlobalData has found.

The report, "Transmission Towers for Electric Power," discusses how, traditionally, global T&D markets were concentrated in North America and Western Europe. This report gives detailed information on the market landscape for transmission towers within the power sector, focusing on global and key national transmission tower markets.

The report also covers drivers, restraints, revenue forecasts, average pricing, market share analysis and volume sales for the global market and eight key countries, while upcoming technology trends indicate future market developments. In recent years, however, the focus of activity has shifted to South and Southeast Asia, Eastern Europe and Latin America.

This trend has evolved for three main reasons:

1. The low-cost advantage companies can gain by shifting some of their operations to these countries;
2. The growing domestic demand in these emerging economies for increased industrial and commercial production; and
3. The rapidly growing populations of many developing countries such as India and China means that companies have a ready-made pool of consumers to target in their new countries of operation.

To meet the growing demand for power, countries will require increased investment in electricity infrastructure. Such growth in installed capacity would require additional investment for installing new T&D infrastructure, including transmission towers.

Past GlobalData studies show that the installation of new T&D infrastructure depends upon the economic growth of the country. As emerging nations demonstrate higher economic growth rates and lower labor costs, the growth of T&D markets here is faster than in developed countries, many of which have reached relative maturation.

In developed countries, new T&D opportunities are expected to come instead from upcoming technologies, and the maintenance and replacement of the aging infrastructure. This is particularly true for North American and European markets, which traditionally have been the major markets for most T&D equipment-manufacturing companies.


Memoori Research: Global Smart Grid Market to Invest $2T by 2030, peaking at $155B in 2021/22 Infrastructure

Memoori Business Intelligence Ltd., an independent market research and business intelligence provider, released the report "The Smart Grid Business 2011 to 2016," which combines market-sizing statistics with financial analysis of mergers and acquisitions, investment and alliances. The report contains information for all those managing, operating and investing in smart grid companies around the world.

By 2021/22, according to Memoori, the world pure smart grid business will need to run at $155 billion—some 50 percent larger than the current annual expenditure for all electrical transmission and distribution equipment. This will require major restructuring of the supply and demand sides if a smart grid is to be realized.

Memoori's research estimates that $2 trillion will need to be invested globally by 2030. Sales of smart grid systems in 2010 stood at just $16 billion, showing the business has a long way to go.

The report indicates that the need to reduce carbon dioxide emissions within the existing electricity production and supply grid will drive the future growth of this business. The grid must be able to incorporate renewable electricity production from a multitude of distributed sources and be capable of matching the supply of electricity with demand at the point of usage and in real time.

The report said that in five years, mergers and acquisitions have grown from $134 million in 2007 to $10.6 billion in 2011. The growth and scale indicate the supply side is gearing up to meet the requirements of new technology and forecast demand for pure smart grid products and systems. Investment in the market is also on the increase with venture capital companies committing some $1 billion a year in 2010 and 2011 to smart grid suppliers.

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