The full text of this Vital Signs Online article can be found here.
Global investment in smart grid technologies rose 7 percent in 2012 from the previous year. On top of direct investments, numerous countries around the world are making headway on smart grid regulatory policies, development plans, and frameworks to support future grid infrastructure upgrades. Smart grids consist of many different technologies serving different functions. Smart grids are commonly defined as an electricity network that uses digital information and communications technology to improve the efficiency and reliability of electricity transport. Such modernized grids are becoming more important as current grid infrastructure ages and regions begin connecting more variable generation from renewable energy sources into the electricity network.
The United States had the highest investment of all countries in 2012 despite seeing a 19 percent decrease in smart grid spending from 2011. While the U.S. federal government has funded smart grid development and supported deployment projects throughout the country, many individual utilities are contributing their own efforts to update grid infrastructure. At the beginning of 2012, U.S. smart grid development efforts had installed 37 million smart meters, covering 33 percent of American households. Continued efforts by utilities to deploy smart grid solutions will become increasingly important in the U.S. as federal funding initiatives enacted under the American Recovery and Reinvestment Act of 2009 begin to expire.
As investment in the U.S. declined, smart grid investment in China continued to grow. Wide-scale smart grid technology deployment has been included as part of a massive ongoing overhaul of China’s inefficient transmission infrastructure. The country’s investment in smart grid technology accounted for 57 percent of all smart grid investment in Asia, an already very active region for smart grid development that accounted for around 40 percent of global investment, with Japan and South Korea heavily focused on development plans and installations.
The European Union saw lower financial investment than the United States or Asia, but has established smart meter installation mandates in recent years and is funding research and development programs focused on smart grid technologies. Electricity Directive 2009/752/EC requires that by 2020 EU member states deploy smart meters in 80 percent of households where the cost-benefit analyses for installations is positive. Smart grid progress in individual countries in Europe varies at present, with high penetrations of smart meters in some and planned nationwide smart meter rollouts in others.
Energy storage technologies offer their own benefits to the modern electricity grid, but can also act as alternatives to or complements of smart grid infrastructure. The number of energy storage projects worldwide rose 19 percent in 2012. Pumped hydropower still dominates all global energy storage infrastructure, accounting for 98 percent of installed storage capacity globally. However, the location-dependent aspect of pumped hydro and the recognition of the growing need for grid-tied energy storage have put emerging technologies, such as advanced batteries, into sharper focus as well.
Smart grid networks and energy storage technologies are gaining traction in energy sector development plans with larger-scale deployments currently beginning or being planned for the near future. The next few years will see numerous nationwide smart grid deployment projects and advancements in energy storage markets. The success of these developments will surely influence the respective paths of each technology’s development.
Reese Rogers is a MAP Sustainable Energy Fellow at Worldwatch Institute.