GreenMonk interviews Stefan Engelhardt about SAP’s vision for Smart Grids

One of the more interesting keynote talks at the recent SAP for Utilities conference in San Antonio TX was the one given by Stefan Engelhardt, SAP’s Head of Industry Business Unit Utilities.

In his keynote he discussed decarbonisation and SAP’s vision around Smart Grids and Smart Meters. I asked him if he’d be willing to come on camera to talk about some of these topics and he very graciously agreed.

With the vast majority of the world’s utilities using SAP’s software, they have their fingers firmly on the pulse of this sector. What was pleasantly surprising to me was the amount of interest SAP is seeing from their utility client companies in Smart Grids. As Stefan himself said in the interview:

For the next couple of years we see a clear trend towards the deployment of Smart Metering technology in the Utilities industry… and that means we have to adapt the existing business processes to this new technology

It was also fascinating to hear Stefan’s predictions around how Smart Grids will be rolled out gradually by utilities. Polling of smart meters by utilities will be ramped up bit-by-bit from maybe once a day to once every 10-15 minutes and this will have huge implications for the amount of data utilities will have to manage. Previously they may have collected 1 terabyte every 10 years. With smart meters reporting energy usage every 10-15 minutes they could be collecting 1 terabyte every month, or less!

With the roll-out of Smart Grids, utility companies will be able to publish energy prices in realtime based on supply and demand. This is important because electricity is more plentiful when renewables are contributing to the mix, so cheaper electricity should also track closely with Greener electricity!.

Utilities will now be able to offer new products like critical peak pricing for peak shaving in times of electricity shortage and even demand stimulation, to encourage people to consume electricity when supply is exceeding demand. This will encourage people to shift some of their loads to times when renewables are contributing more, thereby reducing the CO2 emissions associated with that load.

[Disclosure – SAP covered my expenses to attend this conference]


IBM’s coming on board will speed up the rollout of Smart Grids

Light House

The observant amongst you may have noticed that we have talked quite a bit about smart grids here on GreenMonk. That is because we believe fundamentally in what it is they are trying to achieve and how they are going about it.

And we are not alone in that!

SAP’s AMI Lighthouse Council is all about Smart Grids and hence SAP are holding their SAP for Utilities conference in San Antonio Texas in October where there will be a major focus on Smart Grids.

As well as SAP, not surprisingly the utilities are all over this space because Smart Grids will give them the ability to far better manage their energy supply and the demand, thereby reducing the number of outages. It seems that every day brings news of a new Smart Grid trial by some utility.

ComEd are looking at Smart Grids in Chicago, Manitoba Hydro is testing about 4,500 smart meters in Winnipeg, Xcel Energy has announced plans to make Boulder the first SmartGridCityTM, PEPCO has rolled out a Smart Grid trial in 1,000 homes in Washington DC, Austin Energy plans to have all its meters converted to Smart Meters by December 2008, etc. In fact, here is a Google Map of all the Smart Grid projects currently underway globally!

As well as the utilities, because this is a whole new area, there are literally hundreds of startups in this space from the likes of SynergyModule in Ireland to more established names like Echelon and Itron in the US.

Because of the involvement of these myriad players, IBM has also come on board to try to bring some standards to the table. According to this recent article in CNet,

The idea is to create a common set of communication protocols and data formats that utilities and smart-grid start-ups can adhere to.

With these technical blueprints, based on standards like TCP/IP, new technologies can be plugged into the grid on a large scale…. What’s happening now is a patchwork of smart-grid trials using differing products, an approach that prevents fast technology change.

This is great news for the rollout of Smart Grids globally. If we have a universally agreed set of standards that everyone adheres to then the creation and integration of smart grids and smart grid devices suddenly becomes far less complex.

It will still take some time before there are the devices in place, and the regulators and utilities sign-up to convert completely to Smart Grids but a heavy weight like IBM’s coming on board can only help move things along.

[Full disclosure: SAP have invited me to attend the SAP for Utilities conference, I am a sometime unpaid advisor to SynergyModule and IBM are a RedMonk client, though not a GreenMonk client!]

Photo Credit MumbleyJoe


Energy Demand Management trials

Nissan Pathfinder Dash
Creative Commons License photo credit: navets

Energy Demand Management is a topic we have covered a few times on this blog already because we believe it will be a vital component in helping us better manage our energy resources in the future.

It is great then when you start to see utilities running successful trials of early EDM technologies. According to Francis Logan, Minister for Energy; Resources; Industry and Enterprise in Western Australia, the local energy company Western Power has run a successful EDM trial.

What Western Power did was to test the efficacy of one form of EDM called Peak Shaving where you lower the electrical requirements at times of maximum demand to reduce the ceiling load on the grid. They did so by running a summer trial where domestic air-conditioners were remotely switched off for a few minutes on hot days, resulting in a 27 per cent reduction in peak power use, without any significant loss of comfort for the home owners.

From the government statement:

“The results show that customers reduced their peak power use by 3.5kW when their device was activated,” Mr Logan said.

“This is the equivalent of using four microwaves or two pool pumps, it is a substantial saving.”

The Minister said it was the first time such a trial had been conducted in Western Australia.

“Providing non-intrusive ways of reducing energy consumption is a key to managing peak demand,” he said.

“WA’s peak energy use is primarily driven by air-conditioners, of which WA has a very high number.

In this test a switching device was installed in their refrigerative or reverse-cycle air-conditioners to allow Western Power to remotely turn off the compressor, but not the fan, for short periods of time on hot days. Switching was done six times during the trial, on days when the temperature reached 36C and usually between 3pm and 5pm.

This is a very positive outcome to the test but did not involve the deployment of smart meters as the switching was done by the utility.

Obviously a better long term solution will include easily programmable smart meters capable of controlling devices in the home based on dynamic energy pricing information coming from the grid and instructions given by the homeowner (if energy is cheap -> heat water, chill fridge, turn on dryer; if energy is expensive -> turn off dryer, turn off immersion, turn off fridge compressor).

However, rolling out a system like this will take time and money. Jeff Lee, IBM’s Asia Pacific lead for Intelligent Networks, speaking about a smart meter trial in New South Wales, said that a national rollout of a system similar to that being trialled, would require investments in infrastructure of as much as AU$100 billion dollars.

“You can’t replace the investment in electro-mechanical devices overnight. Gradually, substations will get changed to become IT-enabled. But then you have to build the communication infrastructure to do that. We’re talking about installing sensors on every light pole and on every transformer,” said Lee.