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Introduction
The need for innovation
and progress does not come without a price. The need to
identify all the positives and possible pitfalls prior
to execution is essential in determining whether a project
may live up to expected financial and operating
results. Detailed and fact-based financial modeling
tools are typically used to evaluate the expected
performance of a given project or initiative.
Situation
An investor owned utility was
seeking an opportunity to develop 'smart grid'
capabilities through the introduction of a comprehensive
Distribution Automation initiative. Key areas of
interest included enhancements in advanced metering,
circuit automation, substation performance, work
scheduling, and back office efficiency.
Research
Electric, gas, and
water utilities have been operating for over a hundred
years, and in many respects, the methods of delivering
service to customers have remained unchanged during that
time. However, a major shift is evolving within the
industry, resulting in the need to employ new
technologies, develop new business processes, and
dramatically reshape the industry, as utilities pursue
the vision of the ‘Next Generation Utility’. To evaluate
the needs for our client, The Shpigler Group embarked on
a major fact-finding effort, working with utility
subject matter experts to identify the true, present
state operating characteristics and potential areas for
improvement. We worked with each affected group and
developed scenario analyses for each case to evaluate
the potential impact of a smart grid. We also gathered
data from external sources as a way to consider the
real-life experiences of other utilities that have
already automated portions of their operations. Based on
the research gathering phase, we designed a total
network approach that accounted for all of the desired
elements of the effort.
Analysis
Once we
determined the optimal network approach, we needed to
ascertain the nature of the business potential. Once
again, we worked with internal subject matter experts to
gather needed data about the operations of the electric
utility to determine the potential for distribution
automation applications. We considered a number of
scenarios in the analysis, including hybrid system
designs, differing rate base scenarios, and network
staging options. In the end, we formed a business plan
that was based on developing five distinct sources of
value through the use of the network.
Problem Solved
With
all of the data and analysis complete, we developed a
complete solution based on two key metrics: (1) the most
appropriate network infrastructure approach, and (2) the
characteristics of different business models.
Result
Based on the results of our analysis, the client
determined to pursue a smart grid system. A network design has
been engineered and the first stages of construction
have occurred. An internal team of distribution analysts
and engineers has been assembled to begin the process
of completing the network deployment that will allow for
the immediate capture of utility operations benefits.
Testing of the network approach has been completed,
state regulatory approval has been granted, and full
system development is now underway.
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