Carbon-Pros Analyst Blog

Telecommunications technology is advancing so rapidly that there is considerable FUD factor (fear, uncertainty, and doubt) in the idea of locking in your communications strategy for 20 years. So the Telco says to the Utilityco: no worries, just outsource your grid communications to us!

Given the past problems with BPL and the expense of optical cable, wireless is attractive for avoiding the expense of adding relays and/or stringing new cable. Last week, we reviewed ZigBee as the emerging standard for short-range, wireless networks in the home and for aggregating data across the meters in a neighborhood. Here, we review the use of 3G cellular networks for wireless smart grid connectivity.

Third-generation (3G) cellular networks carry high-speed data as well as voice. They give your smartphone the ability to do email and surf the web. 3G is a collection of communication technologies including GSM EDGE, UMTS, HSPA, and CDMA2000 (details on Wiki). 3G supports data rates up to 14.4 megabits for downlink and 5.8 megabits for uplink. You'll never see these speeds on your smartphone, those speeds apply to stationary devices such as will be used on the grid. The two largest wireless carriers in the US use different versions of 3G. AT&T uses UMTS and Verizon Wireless uses CDMA2000. As you know from switching cell phone providers, their gear is not interoperable. Standards groups are already working on the next-generation (4G) which uses an all-IP infrastructure and achieves gigabit speeds

Smart grid deployments use the cellular network for machine-to-machine communication (M2M). This market it heating up. Verizon Wireless and Qualcomm have formed a joint venture to provide M2M wireless services to a wide range of markets including medical monitoring, consumer electronics, and utilities.

One approach is to embed tiny cell phone SIM cards into the meters. The meter uses the SIM card to communicate with software applications on the network and at the utility operations center. In some architectures, groups of meters will communicate via powerline with one meter acting as a router and using its SIM card to send data from the group to the utility backhaul network. Another approach is to use short-range wireless to aggregate a group of meters and put the cellular connection on the meter aggregator. The strength of cellular is the ability to install a connection anywhere it is needed on the grid. This could be at the meter, aggregator, substation, or anywhere in between. The architecture will vary for urban and rural environments.

3G cellular networks may be the fastest way for utilities to deploy a digital network. Major wireless carriers can connect grid assets such as meters, breakers, transformers and substations directly to the utility operations center. This minimizes up-front deployment costs and turns over network maintenance to the carrier who can do it cost-effectively. That said, the tilities are accustomed to financing infrastructure on 40-year life cycles. They know that in the long-run, it may be cheaper to build and own their own network. Cellular may prove too expensive to become the dominant solution but it will certainly be valuable for some utilities in some parts of their network. And if the wireless carriers drop their rates low enough, they could become major players.

 

SmartSynch is betting that 3G will be a cost-effective and scalable solution for many utilities. Given the conservative nature of utilities, they may be right. SmartSynch has teamed up with AT&T on smart grid deployments for both commercial and residential customers. They also work with other wireless carriers including T-Mobile and Rogers. Echelon also offers a cellular meter, partnering with T-Mobile.

Seeing smart grid as the next big thing (NBT), the telcos may not be satisfied just providing communications. Some telco giants are planning to offer utility enterprise applications that are optimized to work with their wireless communication infrastructure. These won't necessarily be installed in the utility data center. The telcos can provide “cloud computing solutions” to help automate device provisioning and manage grid assets. This moves the telcos out of the network layer and into applications and services.

Using a completely different strategy, the telcos can compete with utilities. Some telcos are offering energy management services directly to their customers. They bypass the utilities meter network (if it exists) with a combination of DSL to the home, with in-home devices connected via standard Wi-Fi network. In the wired world, Verizon plans to offer energy management to its FiOS (fiber optic) customers. While telcos can provide energy dashboards and home automation this way, the telcos won't see any direct benefits from demand response and grid optimization, two of the smart grid's killer applications. If the bypass strategy is successful, it may motivate the utility to jump into the partnership with demand response. In the long run, it makes more sense for telcos and utilities to partner in ways that reinforce their core competencies.

So far most utilities are building their own communications network for smart meter deployments. In Europe, utilities view 3G cellular networks more positively. But this market is just barely underway. The utilities will make most of their technology and supplier decisions in the next few years. 3G cellular networks are sure to be part of the communications strategy for many utilities.