Communications in the Energy Cloud

The Energy Superhighway and the Future of Grid Connectivity

In the coming Energy Cloud future, traditional electric utilities will be challenged to reinvent themselves. Their traditional monopoly role as the sole regional provider of electric power will evolve into one where the grid becomes a critical, two-way network for energy services. These services may include integrated solar and wind, transactive energy markets, microgrids, energy storage, and other disruptive technologies.

In order to fulfill this new role, utilities will increasingly depend upon the Energy Superhighway. This is the robust, ubiquitous, high bandwidth, low latency communications backbone that will be necessary to support the many software- and hardware-based systems that will ultimately power the Energy Cloud. Without the Energy Superhighway, the Energy Cloud paradigm for utilities cannot become reality. But with the Energy Superhighway, utilities may find themselves positioned to not only evolve with the industry, but to actually drive industry evolution. The importance of this critical communications backbone cannot be understated. Massive economic growth, such as that which resulted from the buildout of the Interstate Highway System in the United States in the 1950s, may very well be the outcome of a concerted effort to develop the Energy Superhighway.

This Navigant Research white paper provides a far-reaching view of the connectivity needs of electric utilities—today and tomorrow. The report examines the reasons why a network-centric approach—rather than a silo-based, application-centric strategy—is imperative for power utilities today. It also explores which connectivity technologies are best positioned to be future-proof and provides several case studies of visionary utility projects designed to develop the Energy Superhighway. Each of the topics in this white paper is examined more deeply in research reports and ongoing research from Navigant Research’s Grid Networking and Communications Research Service.

Key Questions Addressed:
  • How important is a utility’s communications backbone to its future role in the energy industry?
  • How will utilities’ strategies for connectivity affect their relevance in the evolving industry?
  • Which communications technologies will be future-proof in the Energy Cloud era?
  • Why should utilities take a long-term view of their networking strategy?
  • What lessons can be learned from the U.S. Interstate Highway System?
  • Why is the communications backbone—the Energy Superhighway—so critical to long-term utility success?
Who needs this report?
  • Utilities
  • Communications and networking equipment vendors
  • Network providers
  • Public cellular providers
  • Landline telecom companies
  • Cable providers
  • Regulatory bodies
  • Investor community

Table of Contents

1. Executive Summary

1.1  Introducing the Energy Superhighway

1.2  In the Beginning…

1.3  In the Future…

2. The Energy Cloud and the Energy Superhighway

2.1  The Energy Cloud: A Framework

2.2  Smart Grid Communications v1.0

2.2.1   Substation Automation

2.2.2   Distribution Grid Automation and Optimization

2.2.3   AMI

2.2.4   Behind the Meter

2.2.5   Many Solutions = Complications and Costs

2.3  The Energy Superhighway as the Backbone for Energy Services Providers

3. A Network-Based Strategy

3.1  A Holistic, Long-Term View

3.1.1   The Interstate Highway System Analogy

3.1.2   More on the Regulatory Challenge

3.2  Early Efforts Only the Tip of the Iceberg

4. A Network of Networks

4.1  Taking the Long View

4.1.1   Near-Term Challenges

4.2  Future-Proofing the Network

4.2.1   Fiber-to-the-Premises

4.2.1.1  Case Study: EPB Chattanooga

4.2.2   Private Licensed Spectrum

4.2.2.1  Case Study: SRP

4.2.2.2  Case Study: GMP

4.2.3   5G

4.3  Public versus Private Networks

4.4  Conclusions

5. Acronym and Abbreviation List
6. Table of Contents
7. Table of Charts and Figures
8. Scope of Study, Sources and Methodology

List of Charts and Figures

  • Smart Meter Penetration Rate of All Electric Meters by Region, World Markets: 2015-2023
  • Ratio of DER Power Capacity Additions to Centralized Generation Capacity Additions, World Markets: 2015-2024
  • The Energy Cloud: Today and Tomorrow
  • Smart Grid Communications v1.0
  • The Energy Superhighway
  • The Energy Superhighway Supports Economic Development in the Energy Cloud
  • Google Fiber Current and Planned Deployment
  • FiOS Network Availability

List of Tables

  • Smart Grid Communications Network Considerations

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