The Role of IoT
in Smart Grid Technology

Sep 10, 2019

Digiteum Team

smart grid


The Role of IoT in Smart Grid Technology

As the traditional grid system is aging and barely keeps up with the growing electricity demand, the governments around the world focus on adopting and integrating smart grid technology.

It has been in focus in the European Union as a system to “efficiently deliver sustainable, economic and secure electricity supplies” for years. In the United States, the efforts for shifting towards smart and clean energy have started a decade ago when the country established the first policy in this direction. From this point, the investment, technology research and development for the smart grid were officially supported by the U.S. government.

In this article, we’ll find out what makes smart grid so important at the national and global level, how it works and what technologies and applications are on the rise in this sector.

Definition of Smart Grid

smart grid IoT

The simplest smart grid definition would sound something like this:

It’s an electricity network that consists of a system of infrastructural, hardware and software solutions that enable two-way communication between all system parts and participants and provide efficient power generation and distribution in the supply chain.

Smart grid is often characterized as a self-sufficient distributed system. It can provide energy from different power sources, including renewables and storage. Moreover, the implementation of this system enables suppliers and consumers with unprecedented control and management capabilities.

You can find a more detailed explanation in Techopedia. Now let’s move on to see how smart grid technology works.

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How Smart Grid Works

Unlike a traditional grid with one-way communication, a smart grid is a complex network that implies multiple two-way interactions between equipment and participants in the supply chain. This structure enables various scenarios of how generated power can move and be managed. Here’s the most basic step-by-step scenario.

1. Generate

Switch to the smart grid allows using the power generated from different and often distributed sources. It includes traditional power plants, renewable solar and wind as well as plug-in electric vehicles and energy storage.

2. Distribute

smart grid IoT

Using a network of transmission lines, substations and automated distribution systems, the power is transformed to the correct voltage range if needed (in case of solar or wind) and distributed among the end-users.

3. Use

End-users get broad power management capabilities and visibility thanks to smart grid applications such as smart meters, sensor-enabled appliances, smart sockets, plugs, etc. Using these tools, consumers become active participants in managing their electricity consumption — use mobile or web apps to monitor and remotely control power usage, configure automated regimes, respond to load changes and control their spending and emission in real time.

4. Control

People, utility companies and other professionals in the energy industry expand their control and management capabilities in a smart grid. Connected homes, communities and the whole cities use electricity and create data on the consumption and loads. This data can be used by any authorized participant in the supply chain. Thanks to data analytics and visualization tools, energy consumption data is turned into insights that make the basis for future decisions.

For example, energy companies can manage grid assets and perform predictive maintenance, utility companies can build demand response programs, residents can dynamically respond to the difference in loads and cut on the consumption when energy is the most expensive.

5. Store

Not only do households practice a more prudent energy use, but also store enough power to provide a house in the off-grid scenario. Using storage, households save extra energy, choose the loads they need to back up and use this energy in the case of an outage, for example. Apart from giving management benefits, storage becomes one of the innovative smart grid technologies essential for independent residential grids that fully rely on renewables and generate much surplus.

Why Do We Need Smart Grid?

First of all, traditional grids are aging and no longer effective with respect to growing electricity demand. The image below proves it showing the basic differences and benefits of a smart grid over a traditional one. Apart from these advantages, there are three basic reasons why we need smart grid technology and applications.

smart grid IoT

To cut cost and risks

Among the biggest problems smart grid solves are wasted resources and lack of safety. Adoption of smart grid technology by households and the whole cities helps monitor and control energy use in real time and optimize it with the best interests of citizens and the environment in mind.

At the same time, improved visibility of every grid’s element — loads, equipment, transmission lines, appliances — allows management to detect any problem in time or even in advance, address it accordingly and prevent expensive and dangerous problems like outages and downtime due to untimely maintenance.

According to the Department of Energy, outages cost Americans $150 billion yearly.

To reduce emissions and carbon-heavy electricity

smart grid IoT

Not only do smart grids provide intelligence, visibility, control and communication into energy consumption process, but also enable green energy.

First of all, together with reduced wasted energy come reduced emissions. Secondly, smart grid’s topology allows including renewables into the network, which makes clean energy sources more accessible for people.

To enable independence and resilience

Today, smart grid software enables consumer-level monitoring and control of energy consumption. It makes a household resident an active participant in the grid’s lifecycle, and a decision-maker too.

Using technologies like energy storage or PV systems, a household is able to temporarily go off-grid, for example, in a case of maintenance or accidents on the line. In this case, the residents can dynamically distribute loads in the house to address their energy needs. Or they can fully rely on the energy they generate and, thus, be absolutely independent of their regional grid.

Innovative Smart Grid Technologies

The operation of smart grid relies on a broad range of technology and infrastructure solutions. Smart grid based on IoT and data technologies is prevailing and includes several important components:

  • Smart sensors and meters. These are the very basic components of a smart grid that enable to track energy consumption on the consumer’s side. Sensors in smart appliances continuously create and report status data to enable monitoring and control. Smart meters accumulate energy use data and show the full picture of energy consumption in the house, including loads and estimated cost.
  • Automated distribution. Advanced distribution systems use real-time data to dynamically respond to the changes in loads, detect blackouts and correct power distribution to enable both safety and economic savings. This is the part where smart grid using IoT introduces automation and self-management.
  • Charging stations and smart storage. In the concept of smart grid, energy storage and charging stations play an important role. Not only do these technologies allow households to safely go off-grid in cases of outages or accidents. They also reflect the growing demand for independent residential renewable systems.

Storage market is expected to reach $50 billion by 2020.

Using Internet of Things in Smart Grid

As you can see, the role of IoT in smart gird is crucial. Internet of Things is in large part the enabler of smart gird as its technological and infrastructural components are mostly IoT-based.

Connected devices, appliances, hubs

home energy monitoring

The data on energy consumption comes from sensor-enabled IoT devices, appliances and the hubs which control a smart house or any other connected space. This data is then used to analyze electricity usage, calculate cost, remotely control appliances, make decisions on load distribution, recognize devices, detect malfunctions and risks of an outage, etc.

Real-time data analytics and visualization

As mentioned above, sensor data is the core of the smart grid operation. Processing, sorting, cleaning, analysis and visualization of real-time IoT data provide visibility in the supply chain from the moment the energy is produced to the point it’s consumed by an end-user. Work with data enables automation, control, management, problem detection and prediction in a smart grid.

Advanced algorithms

Application of machine learning to better understand and use big data is already common in the Internet of Things, and smart grid is not an exception. We know for a fact that machine learning is good at working with massive datum sets, identifying trends, making predictions. Therefore, the use of advanced algorithms to analyze IoT data created in the smart grid supply chain is another way to make it more efficient.

IoT Applications in Smart Grid

Here are some successful examples of the use of IoT in smart grid, from the national level to startup solutions for households.

  • Germany has integrated IoT infrastructure and technology solutions to implement a smart grid project in Mannheim. This project enabled the broad adoption of renewable energy and allowed to coordinate energy consumption and production in the city.
  • Lumin energy management platform is a good example of IoT application in smart grid which enables cost savings, reduced emissions and easier adoption of green energy at the same time. The company offers a smart panel and data analytics tools to optimize storage, manage electricity consumption and facilitate the integration of PV systems in houses.
  • Schneider Electric offers a set of connected solutions for implementing solar power for homes. The company can equip a household with PV systems, monitoring and management tools to go fully off-grid or generate and convert solar energy to partially cover the household’s demand.
home energy monitoring

IoT Smart Grid Solution in Digiteum

At Digiteum, we know about IoT smart gird systems first-hand. We have been designing and developing software for IoT and green energy projects for years. Our experience and skills include designing and developing software and middleware for smart home energy monitoring and control, building data analytics and visualization tools, creating advanced algorithms for device identification, and more.

Are you interested in smart grid technology? Working on an IoT and energy project and looking for an experienced team of software designers and engineers? Check our portfolio, IoT development services and other capabilities and contact us to start a conversation.

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