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SMART TRANSMISSION AND DISTRIBUTION GRIDS

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					       SMART TRANSMISSION AND DISTRIBUTION GRIDS:
  AN EMERGING BUSINESS OPPORTUNITY FOR ELECTRICAL CONTRACTORS
               (1. New Business Sector, 2.Technology Transfer)


                            Dr. Matt Syal, Ph.D., CPC, LEED®AP
                              Professor, Construction Management
              Co-PI: Dr. Sinem Korkmaz, Asst. Prof., Construction Management
          Consultant: Dr. Joydeep Mitra – Dept. Of Electrical & Computer Engineering
                          School of Planning, Design and Construction
                                 213 Human Ecology Building
                             MICHIGAN STATE UNIVERSITY
                                    East Lansing, MI 48824
                            Ph.: 517-432-2951, FAX: 517-432-8108
                  Email: syalm@msu.edu, Website: www.egr.msu.edu/~syalm

Project Summary: Over the past few years it has been realized that the current electrical grid is
getting outdated for modern electricity delivery, wastes a lot of generated power, pollutes the
environment and is liable to attacks from hackers and terrorists. As a result, efforts have been
underway to enhance both the electric power systems as well as the information systems. These
efforts are divided in the following two key categories:
     1. Upgrading of existing transmission and distribution grids
     2. New “smart” transmission grid for alternative/renewable energy sources
A major part of the upgrading category is to add “smart” features or technologies to the electric
grid. The proposed upgraded grid is being termed as the “smart grid.” The Federal Government
has set aside $54 billion to modernize and update the national energy grid and infrastructure. The
new grid development efforts are primarily focused on transporting the electric energy produced
by the renewable sources such as wind and solar, to high population centers. This new smart grid
is termed as the "clean energy superhighway" and is being compared with the development of the
interstate highway system in the 1950’s. Some of the large transmission companies (e.g., ITC
Corp.) and major investors (e.g., T. Boone Pickens) have already started exploring the idea of new
transmission grid for renewable energy.

The goal of this project is to investigate the “Smart Grid Movement” and highlight business
opportunities for electrical contractors (both, line and building). The main objectives include:
  1. Investigate major initiatives by the Government, investors and the utility Industry
  2. Describe various “smart” technologies for existing grid upgrades, as well as, issues related to
      new grid development
  3. Develop checklists summarizing opportunities for Electrical Contractors (both, line and building)
  4. Propose guidelines for developing business proposals for these opportunities
The outcome of this project will be a 4-part report with chapters corresponding to each objective.
In addition, a training course, which can be taught through NECA-MEI, will be prepared. The
proposed outputs of this project are expected to benefit the industry at multiple levels including
individual electrical contractors, electrical contracting industry, and allied industry members.
Overall, it is hoped that the outputs of this research will help the electrical contractors in
developing a successful business niche in this emerging sector.
                                                  1
INTRODUCTION AND JUSTIFICATION:

The U S electric grid, a complex network of independently owned and operated power generation
plants and transmission and distribution lines, has been in existence since the late 19th century.
Today, the grid is a network of 10,000 power plants, about 150,000 miles of high voltage
transmission lines, millions of miles of distribution lines, more than 12000 substations and over
200 million customers (IEEE 2009). The electric grid (refer to Figure 1) is comprised of two main
parts: (a) the Electrical Power System that generates and transports the electrical energy, and (b)
the Information System that monitors, controls, and exchanges information between the utility
company and the customer.


                        Upgrade                                             New Development




                   Existing Power Stations
                                                                      Alternative Energy Sources


                            Upgrade
                                                                        New Development




                    Existing Transmission Grid
                                                                     New Transmission Grid
                                                   Upgrade




                                                 Distribution Grid



                                                   Upgrade




                                             Information System



                                                    Upgrade




                                Consumers – Homes, Businesses and Industry
                                                                                                   `

              Figure 1: Electric Grid with Upgrade and New Development Potential
                                 (Sources: DOE 2009, Mitra 2009)



                                                          2
Over the past few years it has been realized that the current electrical grid is getting outdated for
modern electricity delivery, wastes a lot of generated power, pollutes the environment and is liable
to attacks from hackers and terrorists. As a result, efforts have been underway to enhance both the
electric power systems as well as the information systems. These efforts are divided in the
following two key categories:

1. Upgrading of Existing Transmission and Distribution Grids:
       As indicated in Figure 1, the existing components of the electric grid are being targeted for
upgrading. The scope of this upgrading involves:
 Upgrading the existing transmission grid to improve efficiency and to enhance communication
    with the power plants and the distribution system,
 Upgrading the existing distribution grid to efficiently connect with the transmission grid and
    with the consumers, and
 Upgrading information systems (e.g., automated metering devices) to enhance communication
    between consumers and the utilities.

The main focus of this upgrading is to add “smart” features or technologies to the electric grid.
The proposed upgraded grid is being termed as the “smart grid.” A smart grid can deliver
electricity from suppliers to consumers using two-way digital technology and can lead to energy
saving, reduced cost, and increased reliability and transparency.

The Federal Government has set aside $54 billion to modernize and update the national energy
grid and infrastructure. On October 27, 2009, the largest single electric grid modernization
investment in U.S. history was announced by the Department of Energy (DOE) tapping $3.4
billion in American Reinvestment and Recovery Act and $4.7 billion in private investments to
fund 100 major smart grid projects. Examples of these projects include upgrading the distribution
grids and information systems of major utility companies such as, Duke Energy, DTE Energy, etc.

In addition to the above-noted major awards, DOE, on Nov. 29, 2009 announced funding for 32
demonstration projects that will focus on new technologies related to upgrading the electric grid.
These projects are slated to receive $620 million and are matched with $1 billion private sector
funding. Examples of these projects include energy-storage technologies, smart metering and
distribution, and transmission monitoring equipment.

These above-noted government initiatives, coupled with matching funds from prominent utilities
and investors, are poised to bring about major infusion of work opportunities for the electrical
contractors (both, line and building) nationwide.

2. New “Smart” Transmission Grid for Alternative/Renewable Energy Sources
        With the growing focus on sustainability and climate change, there has been an increasing
push towards developing alternative/renewable energy sources to meet the ever growing demand
for electricity. These renewable energy sources, led by wind and solar technologies, are prevalent
in locations where the national transmission grid does not efficiently reach because existing grid
was developed for power plants that were built near the natural resources (e.g., coal mines) used in
the generation of electricity. Moreover, the existing transmission grid is not well suited for the
renewable energy sources due to the intermittent generation patterns of wind and solar. As the
renewable energy production grows, there is an increasing need to develop a new “smart”
                                                  3
transmission grid that can transport the electric energy produced by these renewable sources to
high population centers. This new smart grid is termed as the "clean energy superhighway" and
being compared with the development of the interstate highway system in the 1950’s. The onset
of this new grid will bring tremendous business opportunities for the construction industry, as a
whole, and the electrical construction industry, in particular.

Some of the large transmission companies (e.g., ITC Corp.) and major investors (e.g., T. Boone
Pickens) have already started exploring the idea of new transmission grid for renewable energy.
One such initiative includes recent plans by the ITC Corporation to develop 3000 miles of extra
high-voltage (765kv) transmission facilities to efficiently move up to 12,000 MW of renewable
energy from the wind-rich areas to major Midwest load centers at an estimated cost of $10-12
billion. This plan is already filed with the Federal Energy Regulatory Commission in Feb. 2009
(ITC 2009).


GOAL, OBJECTIVES AND CORRESPONDING WORK PLAN
The goal of this project is to investigate the “Smart Grid Movement” and highlight business
opportunities for electrical contractors (both, line and building). The main objectives include:

 1. Investigate major initiatives by the Government, investors and the utility industry
 2. Describe various “smart” technologies for existing grid upgrades, as well as, issues related to
    new grid development
 3. Develop checklists summarizing opportunities for Electrical Contractors (both, line and
    building)
 4. Propose guidelines for developing business proposals for these opportunities

The work plan will consist of following steps corresponding to each objective:

1. Investigate Various Initiatives: All current and upcoming initiatives by the Government,
investors and the utility companies relating to both, the upgrade of existing transmission and
distribution grids and the development of new transmission grids for renewable energy, will be
compiled. These initiatives will be analyzed for their impact on the electrical contracting industry.

2. Describe “Smart” Technologies for Existing Grid Upgrades and Issues Related to New
Grid: This objective will be carried out with the help of: (a) analysis of the current and upcoming
initiatives in Objective #1, (b) literature review, (c) interviews with major utilities and
transmission companies, and (d) a survey of the ELECTRI industry task force members. In
addition, 2-3 case study projects in each of the existing grid upgrade and new grid development
categories will be selected and analyzed with the help of the industry task force.

3. Develop Checklists of Opportunities for Electrical Contractors (Both, Line and Building):
Detailed scopes of work will be developed for the technologies and issues identified in Objective
#2. These scope descriptions will be matched with the business scopes of the line and building
electrical contractors and a matrix outlining possible opportunities for these contractors will be
developed. This checklist will be finalized with input from the ELECTRI Industry task Force.
The principal investigator has experience working with electrical contractors in the development
of such checklists. His project report was recently published by the ELECTRI Int’l – “The Role
                                                  4
of Electrical Contractors on LEED Projects” (Syal et al. 2009a). This research project was very
highly received by the task force members and resulted in presentations at the ELECTRI Int’l
meetings and at the 2009 Academy of Electrical Contracting meeting.

Based on the preliminary work done by the researchers, following potential technology and new
development issues have been identified as starting points:

A. Technologies for Upgrading of Existing Transmission and Distribution Grids:

   Phasor Measurement Units (PMU)
   Wide Area Measurement Systems (WAMS)
   Advanced Controls (automated fault detection and diagnosis systems, intelligent distributed
    controls systems, storage stability monitoring and control software, etc.)
   Energy Storage Devices
   Distributed Generation
   Integrated Volt/VAR Control (IVVC)
   Intelligent Substations.
   Fault Detection, Diagnosis and Restoration
   Feeder Upgrades
   Smart Transformers
   Smart Meters / Advanced Metering Infrastructure (AMI)
   Continuous Commissioning and Automated Diagnostics
   Consumption Measuring
   New Building Automated Systems (BAS)

B: Issues Related to New “Smart” Transmission grids for Alternative/Renewable Energy Sources:

The above-noted technologies also apply to the development of new “smart” transmission grids.
In addition, following issues are specific to new grids development.
 Structural Design
 Electrical Systems Design
 Construction including material procurement, installation testing and commissioning
 Construction Management

4. Guidelines for Developing Business Proposals: Based on the opportunities identified in
earlier objectives, the researchers will develop guidelines for business proposals that electrical
contractors will need to develop to highlight their interest and expertise in these emerging areas.
Literature review, prior experiences, and analysis of the case study projects will assist the
researchers in developing these guidelines. These will be finalized with the help of ELECTRI
industry task force members.

The principal investigator has recently completed a successful project for the ELECTRI Int’l that
entailed the development of Sample Business Proposal / Capability Statement for electrical
contractors for LEED projects (Syal et al. 2009b). During the course of this project, valuable and
positive input was received from the task force members and the ELECTRI Int’l staff. The output
of this project is scheduled to be presented at the ELECTRI Int’l meeting in January 2010.
                                                  5
OUTPUT AND DISSEMINATION

The outcome of this project will be a 4-part report with chapters corresponding to each objective.
In addition, a training course with plans to teach through NECA-MEI, will be prepared. The
output of the project will be presented at various ELECTRI Int’l, NECA and related industry
meetings and conventions. The work will also be shared with various Government agencies
(DOE, EPA, State Electrical Commissions, etc.), investors, transmission companies, major utility
companies, and infrastructure and building construction organizations. In addition, articles will be
published in industry magazines and journals.

BENEFITS TO ELECTRICAL CONTRACTING INDUSTRY

It is envisioned that the proposed outputs of this project will benefit the industry at three levels:
1. Individual electrical contractor – electrical contractors (both, line and building) will be able to
    use the outputs to identify and understand upcoming opportunities associated with the “Smart
    Grid Movement.” As a result, they will be better equipped to take advantage of this emerging
    business sector.
2. Electrical contracting industry – the project outputs will help increase the awareness of the
    “Smart Grid Movement” among the electrical contracting industry. Subsequently, such
    awareness will help raise the profile of the electrical contracting industry among Government,
    utility companies, investors, and electrical generation and transmission companies.
3. Allied industry members – the identification and description of existing and emerging “smart”
    technologies will also assist the manufacturers and distributors in effectively devising their
    R&D, production, marketing and delivery strategies.

The need for upgrading the existing grids with “smart” technologies and developing new “smart”
grids is nationally recognized. Recent and planned initiatives undertaken by the Government,
prominent investors and utilities are leading the way for major business opportunities for electrical
contractors (both, line and building) in the near future. This research project aims to investigate
and describe upcoming opportunities from the electrical contractors’ perspective. It is our hope
that the outputs of this research will help the electrical contractors in developing a successful
business niche in this emerging sector.

REFERENCES
Environmental Protection Agency (EPA) ( 2009). “The Smart Grid Stakeholder Roundtable Group
Perspectives for Utilities and Other Implementing Smart Grids.” www.oe.energy.gov [December 2009]
Mitra, J. (2009). “Smart Grids,” Presentation to Grid School- IPU, Dept. of Electrical and Computer
Engineering, Michigan State University, East Lansing, MI
ITC (2009). www.thegreenpowerexpress.com [December 2009]
Picken (2009). www.pickensplan.com [December 2009]
Syal, M., Abdulrahman, K., Li, Q., and Bezdek, W. (2009a). “The Role of Electrical Contractors on LEED
Projects,” Published by ELECTRI International Report, www.electri.org [December 2009]
Syal, M. Li, Q, and Arend, M. (2009b). “Sample Business Proposal / Capability Statement,” Project Report
submitted to ELECTRI International in November 2009
U.S. Depart of Energy (DOE) (2009). “The Smart Grid: An Introduction,” www.doe.gov [December 2009]
                                                    6
BUDGET:

Duration: July 1, 2010 – August 31, 2011

Total Amount: $50,000

Personnel Costs
(incl: faculty and student salaries, benefits and tuition)     $43,610

Travel                                                           1,350

Misc.: materials, supplies, publication cost, etc.                495
                                                         _______________
Total Direct Cost:                                             $45,455
Indirect Cost @10%:                                              4,545
                                                         _______________
Total Budget:                                                  $50,000
                                                         _______________




                                                     7
Principal Investigator: Dr. Matt Syal
      Ph.D. Civil Engineering, Penn State University, 1992
      Professor of Construction Management since 1992
      Recently completed “Role of Electrical Contractor on LEED Projects” for ELECTRI Int’l
      Developed AGC’s National Program on “Impact of LEED Projects on GC’s and CM’s”
      Earned LEED Accredited Professional designation, 2006
      44 funded research and outreach projects (Total amount ~ 3.6 million)
      Publications: 70 refereed/professional papers, 36 project reports and monographs, 27 graduate
       theses / reports / dissertations
      Editorial Board member of the ASCE’s Journal of Architectural Engineering
      Publications and Presentations related to the proposed area:
           o Recent ELECTRI Publications:
                   Role of Electrical Contractors on LEED Projects - March 2009
                   Business Plan / Capability Statement for LEED Projects - December 2009
           o Presentations on “Role of Electrical Contractors on LEED Projects” to
                   Academy of Electrical Contracting meeting, Napa, CA, June 2009
                   ELECTRI Council meeting, NECA Convention, Chicago, IL, Oct. 2008
           o Presentations on “Role of Contractors on LEED Projects” to
                   AGC National Task Force on LEED Projects, Washington DC, Jan. 2008
                   AGC Annual Convention, Las Vegas, NV, March 2009
           o Presentations on Construction Management and Green/Alternative Energy Movement to:
                   Institute of Public Utilities, Annual Forum, East Lansing, MI, Jan. 2009
                   Institute of Public Utilities, Training Workshop, East Lansing, MI, Oct. 2009
           o Syal, M., Mago, S. and Moody, D. (Dec. 2007). “Impact of LEED Projects on the
                Construction Industry,” ASCE Journal of Architectural Engineering.
           o Two Ph.D. and two M.S students working in the area of green projects and construction
                management

Co-Principal Investigator: Dr. Sinem Korkmaz
      Ph.D. in Architectural Engineering, Penn State University, 2007
      Assistant Professor of Construction Management since Jan. 2008
      Recently completed a research project for ELECTRI International - “Project Delivery Methods for
       Electrical Contractors in Energy Efficient Markets”
      Earned LEED Accredited Professional designation, 2009
      Designed and teach a graduate course entitled – Integrated Approach to Sustinable Planning,
       Design and Construction
      Publications and Presentations related to the proposed area:
           o Korkmaz S. and Clement, C. (2009). “Project Delivery Methods for Electrical Contractors
               in Emerging Energy Efficient Markets”. Project Report submitted to ELECTRI
               International, September 2009
           o Clement, C. and Korkmaz, S. (2009). Project Delivery Methods for Electrical Contractors
               in Energy Efficient Markets. The Journal of the American Institute of Constructors. Under
               review.

Consultant: Dr. Joydeep Mitra
      Ph.D. in Electrical Engineering, Texas A&M University, 1997
      Associate Professor of Electrical Engineering and Power Systems since 2008
      On-going research in Electrical Power Systems and Distribution
      Instructor for training program on Smart Grid for the Institute of Public Utilities

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