The potential benefits of implementing smart grids across India


India is steadily increasing its dependence on renewable energy resources like wind and solar. The central grid into which these unconventional energy resources are fed will have to be highly adaptive, both in terms of supply and demand. Hence, it is critical to build smart grids in India. Also, a good electric supply is one of the key infrastructure requirements to support a country’s overall development. Smart grids ensure a reliable supply of power.

By Baishakhi Dutta

The legacy power grids in use currently have a lot of limitations. But they are now evolving to become smarter, by adopting digital technology and distributing renewable energy. This modernised grid system is called a smart grid, and is much more reliable and efficient than the conventional one.

The smart grid is capable of two-way communication since it is powered by underlying digital technologies. Smart grids can measure the utility supply as well as the needs of customers—all of which is sensed along the transmission lines. This communication helps in saving energy, reducing costs, and ensuring reliability and transparency. This also reduces the demand for and dependence on fossil fuel based energy.

The constituents that make a grid smart are its intelligent controls, communication capabilities, real-time monitoring features and self-healing capabilities, along with various other services. Such systems can easily read the power consumption of the load and also control it remotely from a control system. To make it happen, devices like smart sensors and smart meters are integrated into the grid system. The attributes of a smart grid are listed below.

  • Self-healing: It can quickly detect, analyse, respond and fix the faults in the grid.
  • Secure: It can resist any type of physical and cyber security attacks.
  • Consistent: It provides consistent power quality based on the demand.
  • Accommodating: It not only accepts energy from conventional sources, but also from renewable energy sources like wind and solar.
  • Communicative: It can communicate the needs of consumers and provide electricity based on individual preferences.
  • Quality focused: It delivers interruption-free and quality-centric power services.

    Why smart grids?

    Smart grids address many of the following shortcomings associated with the traditional grid systems.
  • The existing power grids are very old and may not be useful in the future.
  • Smart grids can meet the increasing demand for electricity.
  • They can give consumers control over their energy needs and help them lower their energy bills.
  • For consumers, smart grids can provide transparency regarding consumption figures and pricing.
  • They can reduce the production and consumption cost of energy.
  • The probability of burnouts, blackouts and surges will decrease with the use of smart grids.
  • Smart grids can help to store renewable energy and make it available when needed.
  • They will lead to a more sustainable grid, particularly when the dependence on conventional energy sources reduces.

Types of smart grid technologies
Currently, there are three types of smart grid technologies.

  • Smart metering/demand side management: Smart meters are microprocessor based devices that provide two-way communication. They help home owners and electricity suppliers to manage demand and supply in a more efficient and cost-effective manner. With the help of the information provided by such smart meters, the power companies will have the capability to set up real-time pricing systems for electricity.
  • Virtual power plants: The goal of virtual power plants (VPPs) is to allow discrete energy resources (DERs) to access the energy market, i.e., to feed the electricity grid constantly and reliably.
  • Micro grids: This is a cluster of local DERs that loads in a manner such that any operation can be done within the grid collectively or independently. The DERs in the cluster usually require a low to medium voltage to operate.
    All these technologies can be used in India in different forms, depending on the applications. Different algorithms can be used for the control of smart grids, VPPs, etc.

Challenges and solutions
The first challenge is the lack of awareness among people. So, before implementing these grids, consumers should be made aware of what a smart grid is, how it can contribute to a low carbon economy, and what benefits users can derive from it.

Consumers must also be made aware of their energy consumption patterns at homes, offices, etc. The future prospects of smart grids must be properly communicated by policy makers and regulators. Utilities should be responsible for the overall installation and full utilisation of the capabilities of smart grids, rather than limiting themselves to the implementation of smart meters.

A few other challenges that need to be addressed for the smooth execution of smart grid projects in India are listed below.

  • Policy and regulation: No defined standards and guidelines exist for the regulation of smart grid initiatives in India. The policy and regulatory frameworks that are available today are aligned towards the regulation of the existing utilities and networks. Setting up smart grids will require the prevailing regulatory frameworks to be upgraded in a manner that will encourage investment. The new framework will need to match the interests of the consumers with the interests of the utilities and suppliers to ensure that the societal goals are achieved at the lowest cost to the consumers.
  • Cost: The cost is one of the more challenging areas when implementing smart grids. Some of the older equipment from the traditional grids cannot be retrofitted with smart grid technology. These have to be replaced, which is a financial challenge for utilities and regulators. An early replacement of equipment, on the other hand, becomes financially sub-optimal. The cost of implementing smart grids is considerable, though the benefits accrue not just from meter readings but include reduction in equipment failure, better quality of supply and greater use of green energy. It takes a careful societal cost-benefit analysis, beyond merely return of investment calculations, to justify the use of a smart grid.

The way forward

It is very difficult to analyse the performance and benefits of smart grids without actually implementing them. Techno-commercial pilot projects can offer interesting potential demonstrations of the various benefits of smart grids. The overall aim of these projects should include developing a clear vision for smart grids, raising awareness through education and developing a consensus among citizens and service providers, identifying viable funding channels, and framing suitable policies and regulations that will set common standards.

Small and medium sized projects should be tested both in rural and urban areas. This will help arrive at an optimal project, which can be implemented on a larger scale.

It should be emphasised that any plan must be adaptable to the unique needs, cultural and political realities, and resource constraints of different regions, states and localities. It is crucial to not limit the early stage development of smart grids to a top down ‘one size fits all’ approach. Smart grids can satiate India’s energy needs in a green and optimal manner, if implemented in a planned way.


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