$3.4 Billion for Smart Grid Projects? Let’s Make a Broadband Deal!

Yesterday, the Feds awarded $3.4 billion to 100 smart grid projects across the U.S. There were about 400 total proposals. Since these are 50-50 matching grants, that means total dollars being queued up by these entities for smart grids is quite substantial.

For public and private sector organizations seeking broadband ARRA grants or planning to build networks without these grants, this smart grid investment could have stimulating effect. Those who stand to really benefit are urban areas submitting broadband adoption and public computer center proposals, and urban areas that may have given up on ARRA altogether after seeing the NOFA rules.

Big picture view

The best way to describe things so you see why yesterday’s news is important is to break down a smart grid into its main components.

There is the smart meter device that’s attached to (or built into) water, gas and electric utility meters at commercial and residential buildings to collect data on energy usage. The data collected can help utility companies manage their energy resources more effectively. Utilities can also communicate with these meters, sending data, commands to turn down air conditioners, queries to find the source of water leaks, etc.

Smart meter devices generally have their data aggregated to another computing device mounted at some point in the neighborhood, maybe one aggregation point per 100 dwellings (a hypothetical number). Then all of the aggregation points have to traffic their data back to the utility or wherever else it needs to go.

Overall, the smart grid can also be tapped to manage mobile utility workforces who can communicate with office staff and smart meters, as well as access office computer networks, via wireless mesh built into the grid and handheld mobile devices. The grid is also envision as a cost effective way to move energy such as that collected on windmill farms from one point of the country to another.

A primary intersection between smart grid and broadband potentially exists through the data backhaul infrastructure of the grid. A community’s fiber network can provide the backhaul for this aggregated data. Or a utility can build its own fiber backhaul and determine how to make that fiber available for local government and other institutions for their use. These stimulus grants went to public utilities, so local government and the community can have some influence in a discussion on the matter.

The mechanics of this whole smart grid are complex, but you get the big picture view. All of the things people are talking about doing with smart grid, such as moving “green” energy from windmill farms and proactively managing energy usage, require at some point a fast data connection. That means fiber (the ideal) or possibly super-fast fixed wireless. 

How to leverage the opportunity

Community broadband projects that survive the first phase of cuts in the NOFA round 1 funding process will soon go into a due diligence phase where NTIA/RUS will ask applicants to clarify and fine-tune their proposals. If an applicant is in an area that won one of these smart grid grants, they need to get with the smart grid winner ASAP and determine how the broadband proposal can be tweaked to incorporate, or integrate with, aspects of the smart grid project.

The end goal for NOFA applicants would be to strengthen the business case or the technology strategy of the broadband proposal. For the smart grid grant winners, this collaboration can lead to a better overall infrastructure that moves their data more efficiently. You can even contact the 300 applicants that didn’t win a grant. Smart grid is pretty important in utilities’ future plans, so they should at least listen to what you have to say. 

Urban areas definitely need to jump on this opportunity with both feet. Public utilities in Philadelphia and Baltimore are just two major cities that won big grants, and these are areas that have little or no chance at getting an infrastructure grant. But if big cities have broadband adoption and/or public computer center proposals in the queue as Philly does, they possibly can work out a way to tap into aspects of the smart grids wireless network or backhaul. Because the network infrastructure would already be paid for, NOFA applicants can make a stronger case for financial sustainability of the project.

The devilish details 

When contemplating the details of making this work, the first thing I always consider is the politics. Big utility companies in big cities mean potentially big political headaches trying to integrate the efforts needed to make this whole vision work. On the other hand, no risk, no reward, no pain, no gain.

There are a number of technology and potentially complex standards issues at play that have to be worked out. Different smart grid companies use different technologies for the devices that sit on meters, and this can play havoc with getting the data to a standard backhaul pipe such as a fiber or a WiMAX network. Not all of those devices are built around IP-based technology.

While those who understand WiFi networks’ potential to improve utility meter management praise the use of wireless mesh by some smart grid companies, some of these companies use different wireless than 802.11. Looking at which smart grid projects receive funding will help determine what standards should start to shake out. Did the IP-based projects get the lion’s share of the awards?

Bottom line? It’s clear where there is the potential for an intersect, and why it behooves broadband stimulus applicants to meet with utilities winning smart grid grants. But everyone involved must be prepared for a lot of work to make the integration happen.

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