Check out the article about last month’s NARUC conference. Lots of great discussion centered on why cellular for the smart grid is the new reality:
A panel of industry specialists speaking at the National Association of Regulatory Utility Commissioners’ summer meeting today said that existing cellular networks are becoming a more attractive option for utilities looking to develop communications systems for their smart grid programs. Panelists pointed to cellular network pricing continuing to trend lower and new security capabilities on the networks that are making them a viable option to developing proprietary “mesh” smart grid communications networks.
“The question that you should ask yourself is, is it in the best interest of my ratepayers to build from scratch a private network that is some cases can cost $1 billion or more dollars when existing networks are already there … and it is equally cost effective to use them,” said Campbell McCool, chief marketing officer, SmartSynch.
Although utilities have existing cellular network relationship, utilizing them for smart grid applications historically has not been cost effective, said Mr. McCool. However, now there is a “new pricing reality” with such networks. Existing networks have steadily lowered their rates charged to utilities to retrieve their data from a rate of $10 per meter per month in 2000 to a current level of 35 cents per meter per month, said Mr. McCool. “Historically, the economic realities were that for most of North American utilities, building out their smart grids working with existing cellular providers was just too expensive. That is no longer the case. It is now on par or even cheaper in real dollar amount outlays over the life of the system to work with existing cellular networks,” he said.
Mr. McCool also urged regulators to “coach” their utilities to look at the cost of smart grid communications systems over the lifetime of the system. “With cellular based systems most of the upgrades to the technologies are made on the carriers’ dime,” said Mr. McCool, which represents a “tremendous” driver of lowered costs.
Panelists pointed to a recent white paper issued by Duke Energy which concluded, after analyzing different options and considering the state of pricing, that it would work with existing networks for its smart grid.
“There is obviously no one size fits all solution, but clearly today it is a new day for cellular,” said Mr. McCool. “The pricing reality of where we are changes everything.”
Existing cellular networks also compete favorably with proprietary systems in terms of performance, said Andy Wood, director-business development with Qualcomm, Inc. Cellular networks are very competitive with regards to download speeds and capacity, said Mr. Wood. “The ability to design a network that can adapt quickly to its performance requirements is paramount. That’s why I think cellular has such an advantage,” he said.
Reliability of cellular networks, driven by innovation in the industry, is also a factor in their favor, said Mr. Wood. Chipsets contained in smart grid devices now have the ability to detect connect to multiple networks in case a network fails. “That is something very new and innovative and is going to make a difference in terms of utilities trusting these networks,” said Mr. Wood.
Panelists also extolled the virtues of the security features contained in existing cellular networks. Unlike private networks, existing cellular networks have years of experience in combating cyber threats and hackers, said Raj Vanswani, chief technology officer, Silver Spring Networks.
“The question to ask when someone comes with their propriety system is: Has this system been under constant attack every day for the last 30 years,” said Mr. Vanswani. “If the answer is yes — and no one but an IP-based solution can probably say that — then great but more likely the answer is no.”
-Matt Squire