Current Grid vs. Smart Grid

The Smart Grid vs. The Current Grid

Problems with the Current Grid

Today, electric power distribution is made possible by the power distribution grid, a system of transmission mediums that allow electricity to be transferred at different voltages from the point of generation to our homes.

This system came to be as a result of industrialization and meeting the electricity needs of a growing (and westward-bound) population in the United States. In the early 1870s and 1880s, Direct Current (DC) systems were popular. Because it operated with a uniform voltage from generation to use, DC systems were integrated only in factories and small downtown urban centers which had favorable economies of scale. Sadly, this left 95% of residents in the United States without electricity.

Alternating Current (AC) was the first major development to change that. Pioneered by the French during the 1860s, it was not until 1886 in Great Barrington, MA that the first full AC power system in the world was developed. AC power had the advantage of step-up and step-down transmitters, which allowed for the manipulation of voltage and as a result the development of a grid which could reach everyone in the United States. The Westinghouse Company enjoyed an early monopoly on AC power, having gotten the rights to Nikola Tesla’s patents for polyphase alternating currents.

Generation by multiple sources became possible at sites distant from that of the final user. A windmill, for example, could generate power by spinning a turbine. That power’s voltage would be “stepped-up” to travel a long distance to its final user, and then “stepped-down” to a more appropriate 120V for a household lamp. Multiple generators could then be connected over a large area, reducing generation costs and enhancing economies of scale. The sad part is, the history essentially stops there. The last major development in our grid was around the turn of the 20th century.

The rapid industrialization of the United States meant the grid would become a crucial part of our nation’s infrastructure. We continued to develop and refine it, though it remains today largely the same as it was then: a technology developed in the late 19th century. This presents a problem today. Since we have become so path dependent on our grid, what can we do from the confines of our current infrastructure to improve its efficiency and reduce not only our wasteful spending but our carbon footprint?

Presently, the grid is facing a multitude of challenges that can be outlined in four categories. First there are infrastructural problems due to the fact that the system is outdated and unfit to deal with increasing demand. As a result, network congestions are occurring much more frequently because it does not have the ability to react to such issues in a timely fashion. Ultimately such imbalances can lead to blackouts which are extremely costly for utilities especially since they spread rapidly due to the lack of communication between the grid and its control centers. A second flaw is the need for more information and transparency for customers to make optimal decisions relative to the market, so as to reduce their consumption during the most expensive peak hours. Finally, a third problem is the inflexibility of the current grid, which can’t support the development of renewable energies or other forms of technologies that would make it more sustainable. In particular, the fact that renewable sources such as wind and solar are intermittent poses a significant problem for a grid that does not disseminate information to control centers rapidly. All of these problems are addressed by the smart grid through improved communications technology, with numerous benefits for both the supply and demand sides of the electricity market. (Li et al., 2010)

The Smart Grid

The smart grid is defined in the European Union’s SmartGrids Strategic Research Agenda 2035 as follows:

“A SmartGrid is an electricity network that can intelligently integrate the actions of all users connected to it – generators, consumers, and those that do both – in order to efficiently deliver sustainable, economic and secure electricity supplies.” (EU Report, 27)

Instead of completely replacing the current grid, the transition to a smart grid is simply a significant revamping of it with technologies such as meters, sensors and synchrophasors.  When added to the existing infrastructure, these inventions will provide massive amounts of data about consumption, voltage, the health of infrastructure and many other aspects of the electricity supply to the control centers. More importantly, it is the rate of communication that is revolutionary: the synchrophasors report data up to 30 times a second, as opposed to the rate of once every two to four seconds with present day instruments. With improved communications, the smart grid resolves many of the problems listed above, and provides benefits to consumers and suppliers. The analysis of this website uses an economic supply and demand framework to understand the incentive structure for the smart grid, looking at the benefits to producers and consumers. (Economist, 2010)

First, we present a survey of the three technologies that compose the backbone of the smart grid, and then we discuss its potential as a revolutionary general purpose technology. Then, we delve into the demand response potential of the smart grid, and we make the case for the use of open standards as the best possible option in maximizing the benefits of the grid for consumers. On the other hand, we argue that vertical integration and a monopoly structure are the most efficient supply-side structures for the optimization of smart grid benefits for suppliers. Finally, we delve into the social barriers to implementation to try to understand the forces that oppose the smart grid, as well as potential solutions to these problems.

– Clement and Kevin


“Building the smart grid.” The Economist [US] 6 June 2009: 16(US). Academic OneFile. Web. 1 May 2012. <|A201098829&docType=GALE&role=>

European Technology Platform SmartGrids (2012). SmartGirds SRA 2035: Strategic Research Agenda Update of the SmartGrids SRA 2007 for the needs by the year 2035. <>

Fangxing (Fran) Li, Wei Qiao, Hongbin Sun, Hui Wan,  Jianhui Wang, Yan Xia, Zhao Xu, and Pei Zhang (2010). “Smart Transmission Grid: Vision and Framework.” IEEE Transactions on Smart Grid, 1-10.

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