Are Your Transformers Ready for the ‘Smart Grid’?

Executive Summary

The definition of the ‘Smart Grid’ is still something that is taking shape. Utility professionals concur on
some aspects and ideas of what the smart grid should be, but there are still grey areas that, however,
promise to become clearer soon. Some groups will tend to focus on the specific technologies that go into
creating this ‘intelligence’ in a power network; others will take a more generalized view and look at the
smart grid’s operational characteristics and capabilities.

Power system intelligence is essentially about taking sensory and analytical capabilities down to the
substation or device level, all the way at the bottom of the system hierarchy. Smart grids will produce a
steady stream of information about system conditions and operating characteristics that are valuable for
managing the commercial side of a given utility or grid operator.

More intelligent systems for monitoring combined with the substation and feeder automation in power
distribution networks can bring several improvements:

• Better reliability
• More availability
• Enhanced security
• Energy efficiency

This Whitepaper takes an open view of the smart grid. It begins by noting the need for a smart grid and
locating its capabilities and operational characteristics. The paper also takes a closer look at the smart
grid as a concept and the various energy benefits the economy can reap from its implementation.

The smart grid is essentially a highly automated system that will evolve based on adoption of fresh
standards industry-wide. With something as large as a power grid, radical change cannot occur – the
existing system will go through a series of gradual transformations. And energy transformers have a
crucial role to play in this evolving 'smart' system.

The whitepaper goes on to describe the importance of the millions of transformers that play a crucial role
in the energy distribution system in the US. It then touches upon the role Pacific Crest Transformers can
play in the emerging milieu.

Introduction

The century-old power grid is the US has often been called “the largest interconnected machine on
Earth”. Little wonder, because it consists of more than 9,200 electricity generating units, with more than
1,000,000 megawatts of generating capacity connected to more than 300,000 miles of transmission lines.
However this mammoth power infrastructure is nearly a century old and is understandably running out of
steam. The lights may still be on but relying on an often-overtaxed grid is becoming increasingly risky.

Since 1982, growth in peak demand for electricity – driven by population growth, bigger houses, bigger
TVs, more air conditioners and more computers – has exceeded transmission growth by almost 25%
every year. Yet spending on research and development – the first step toward innovation and renewal –
is among the lowest when compared to all other industries.

Even as the demand for energy has skyrocketed, there has been chronic underinvestment in getting
energy where it needs to go through transmission and distribution, further limiting grid efficiency and
reliability. While hundreds of thousands of high-voltage transmission lines course throughout the United

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States, only 668 additional miles of interstate transmission have been built since 2000. As a result,
system constraints worsen and power quality issues are estimated to cost American businesses an
average of more than $100 billion each year.

The grid’s centralized structure also leaves the US open to blackouts. In fact, the interdependencies of
various grid components can have a cascading series of failures that could bring banking,
communications, traffic, and security systems among other things to a complete standstill.

National challenges like the aging power grid, increasing energy demands, spiraling cost of generating
electricity and its cost on the environment are all pointing in one direction, and one direction only: a grid
that is more efficient in energy production and distribution.

For years technologists have been toying with the idea of a ‘Smart Grid’, an electricity distribution system
that uses digital technology to eliminate waste and improve reliability.

Advocates of the smart grid also say that it would open up new markets for large and small scale
alternative energy producers by decentralizing generation. It would allow consumers to have a much
more complex relationship with their energy supplier.

More on the Smart Grid

To put it in the simplest way possible, “the Smart Grid will deliver electricity from suppliers to
consumers using digital technology to save energy, reduce cost, and increase reliability and
transparency.”

What’s Driving the Development of the Smart Grid?

1. Efficiency and Reliability

Even the most modern power systems lose up to 8% of
the electricity leaving the power plant, thanks to Technologies that Will Drive Smart
inefficiencies in transmission and distribution. Utilities
Grid Evolution
and grid operators are also facing growing problems with
reliability of an aging grid. The United States accounts for
only 4% of the world’s population and produces 25% of • Integrated communication that
its greenhouse gases. According to research sponsored connects grid components to
by the U.S. Government, improving the efficiency of the open architecture
national electricity grid by even 5 % would be the • Software that can be upgraded
equivalent of eliminating the fuel use and carbon and enhanced for real-time
emissions of 53 million cars! information
• Control, allowing every part of
2. Renewable Energy Generation the grid to ‘talk’ and ‘listen’
Our world is running out of fossil fuel, and increasing • Sensing and measurement
environmental concerns are encouraging the technologies that support
development of renewable energy sources. Solar power, remote monitoring
wind energy and other renewable power generation, • Time-of-use pricing (pricing
however, presents several challenges – primarily determined as the power is
because of their sporadic nature. The existing power used, rather than weeks later
infrastructure is severely limited in its capability to when a meter is read) for
integrate more renewable sources, and also to companies and consumers
incorporate the new paradigm of consumer-generated
electricity, which can feed excess power back into the
grid. The smart grid is the logical step to enable these newer technologies to flourish.

Another aspect of renewable energy is transportation – we are likely to see many more electric

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 vehicles on our streets before long. The benefits of such a shift to ‘cleaner’ ways to get people and
things from A to B have been discussed at length, but power infrastructure today does not provide the
charging stations and power storage devices that can balance the demand-supply equation and
minimize the instabilities of renewable power generation.

3. Responding to Consumers
As users of increasingly expensive energy, consumers want more control over their usage. Existing
technology can meet this demand, but the grid itself is limited by how much of the newer tech can be
integrated.

A true smart grid will not be possible unless each new major device and system that is part of the grid is
able to communicate with every other system on the grid. This critical ‘interoperability’ depends on a
coordinated framework of protocols and standards that is in a very early stage of planning.

Up ahead in the smart-grid future, an intelligent system will work with consumers to save energy, produce
electricity from a range of renewable sources, anticipate its own failures, see to its own repairs, store
energy out on the grid and provide a fueling system for the new generation of electric vehicles…

How Much of the Smart Grid is Already Here?

Substation automation, SCADA systems, reactive power compensation, feeder automation – all these
‘smart’ devices have been implemented by utilities across the last few years. However, this evolving
process is constrained by available resources, technology maturity, and several business issues. Utilities
need experienced and reliable technology partners to help make the transition from using isolated
instances of smart technologies to a nationwide implementation.

According to Research Reports International (2008), the fully realized smart grid will differ from the one
we have today in the following ways:

Current grid Smart grid

None or one-way; typically not real-

Communications Two-way, real-time
time

Customer interaction Limited Extensive

Metering Electromechanical Digital

Operation and Manual equipment checks, time- Remote monitoring, predictive,

maintenance based maintenance condition-based maintenance

Generation Centralized Centralized and distributed

Power flow control Limited Comprehensive

Prone to failures and cascading Pro-active, real-time protection and

Reliability
outages islanding

Restoration Manual Self-healing

Topology Radial Network

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Transformers and the Smart Grid

The smart grid applies technologies, tools and techniques that will:

• Ensure its reliability to degrees never before possible

• Maintain its affordability
• Reinforce its global competitiveness
• Accommodate both renewable and traditional energy sources
• Reduce the carbon footprint
• Introduce advancements and efficiencies yet to be envisioned

Adoption of the Smart Grid will enhance every facet of the electric delivery system, including generation,
transmission, distribution and consumption.

A smart grid is therefore foundational for a sustainable energy future; and if there is a growing consensus
within the United States that clean energy is a platform for rebuilding the American economy, then it
follows that the realization of the smart grid is also critical to economic growth.

For the smart grid to work efficiently there will be a need for 'smart transformers' - the hub for collection
and distribution of energy. As part of the distribution network, there are millions of transformers in the
country; unfortunately a scant few of them have any intelligence or communication capabilities - or to
generalize the concept of advanced metering infrastructure (AMI) - are parts of an advanced sensor
infrastructure (ASI) network.

By giving transformers 'intelligence', even if it is only to analyze voltage discrepancies, grid efficiency
would still increase dramatically. This same energy efficiency can be applied to virtually any element of
the distribution network that is given ‘intelligence’. Something to note here is that current legacy
transformers are really in much worse shape than ‘dumb’ meters and are due for replacement in this
coming decade.

Many transformer manufacturers are recognizing this impending demand for on-line transformer
monitoring products and diagnostic services, and investing in them. These technologies will be critical for
improving grid reliability and helping utilities avoid transformer failures and resultant blackouts. They will
also reduce maintenance costs and defer capital expenditures by extending a transformer’s useful life.

Pacific Crest Transformers and the Smart Grid

Pacific Crest Transformers (PCT) has been providing energy transformer solutions to a large number of
industries since its inception in 1919. Over the last 90 years PCT has served clients across the nation and
around the world.

PCT is committed to designing and manufacturing superior quality, custom-built and specialty
transformers in the most cost-effective and responsive manner possible. The company has experience in
building Padmount, Station and Secondary Unit Sub Transformers, and today specializes in
environmentally friendly and energy-efficient liquid-filled distribution transformers. PCT was propelled
towards its energy efficiency initiative in its attempt to produce efficient, energy saving and therefore
environmentally sensitive transformers.

PCT designs custom transformers after an elaborate consultative process with clients; the transformers
are based on client specification and are designed to fit into the existing infrastructure.

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Conclusion

The drive to move towards energy-efficient appliances and put in place an energy saving distribution
system is gathering momentum, and the smart grid is the solution that makes sense. Even though initial
investments in technology will be high, the smart gird infrastructure will begin paying for itself within a
matter of years.

The smart grid will also play a positive role in reducing greenhouse gas emissions. Even though the
technology is still evolving and questions about its sustainability and implementation are many, the smart
grid is no longer an option; it is an imperative for the future.