GE Energy

Session 5 of a 5 Part Series on the Smart Grid

The Smart Grid Lunch and Learn

Session 5: The Smart Grid The View From Rural America e e o ua e ca
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Smart Grid Learning Series

Session 1: The Smart Grid and its Benefits Session 2: The Smart Grid The Consumer View Session 3: The Smart Grid The Distribution View Session 4: The Smart Grid The Transmission View Session 5: The Smart Grid The View from Rural America Grid

Session 5: The Smart Grid The View From Rural America

Topics:
Previous Session Review M k Di Market Drivers Increasing Costs Smart Grid Solutions A Recap The Role of Advanced Metering Infrastructure (AMI) WiMAX Bringing Broadband and the Smart Grid to Rural America Green Generation in Rural America Biomas Generation Small and Large Wind Generation A Role for PV? The Impact Green Generation on the Distribution System Impact of Policy Discussion

Smart Grid - Review

Industry challenges
Soaring energy demand Power outages financial impact Green energy takes center stage Electricity prices on the rise Aging infrastructure/workforce

Electricity prices on the rise

U.S. sees 6.5% spike in 09 electric bill l t i bills

6.5% %

Source: EIA (Energy information Administration)

Electricity Poised to change the world again

We cant solve problems by using the same kind of thinking we used when we created them.
- Albert Einstein

The Smart Grid

Growing complexity in modern grids

Grid inefficiency

Source: AEP PUC Hearing

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Aging assets
Transformer failure rate
100%

80%

60%

40%

20%

0%

1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93 97

Age in Years
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Emerging Capabilities

Wide-Area Protection & Automation Wide-Area Monitoring g & Control

Renewables Forecasting

Renewables Smoothing

Delivery Optimization

Demand Optimization

Asset Optimization

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Smart Grid The View from Rural America

Rural Electric Cooperatives An Overview

864 distribution, 66 generation & transmission cooperatives serving:
40 million people in 47 states 17.5 million businesses, homes, other establishments in 2500 of 3141 (80%) counties in U.S. 12% of U.S. population

Electric cooperatives in the United States:

Own/maintain 2.5 million miles (42%) of nations distribution line, covering 75% of U.S. landmass Deliver 10% of total kilowatt hours sold in U.S. each year G t l t f l t i it d d in U.S. h Generate almost 5% of electricity produced i U S each year

Own assets worth $100 billion Employ nearly 67,000 people Pay over $1.2 billion state/local taxes
Source: National Rural Electric Cooperative Association

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American Recovery & Reinvestment Act of 2009

10.8 10 8 7.2 12.7 5.0 4.5
Smart Grid BPA WAPA Energy Efficiency Fossil Energy

46.2 46 2

2.7

3.3 Plus $30-60B in $ additional customer spend

Broad America Bonds/ Energy Band Competes Guarantees Segment

~$100 billion energy related spend

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What is a Smart Grid?

The integration of two infrastructures securely g y
Electrical infrastructure Electrical Infrastructure

Information Infrastructure

Sources: EPRI Intelligrid

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ARRA Broadband Provisions

ARRA allocates $7.2B for broadband funding
$4.7B $4 7B to National Telecommunications & Information Administration (Commerce) $2.5B to Rural Utilities Service (Agriculture)

National Telecommunications & Information Administration funding (Grants)

Provide broadband to people residing in unserved/underserved areas, community support organizations (schools, libraries, etc.), agencies that facilitate broadband use by low-income, aged, ot e vulnerable g oups o co e, other u e ab e groups Stimulate demand for broadband, job growth, economic development

Rural Utilities Service funding (Grants/Loans)

At least 75% of area receiving funds must be in rural area without sufficient access to high speed broadband service to facilitate rural economic development Priority given to projects that will give customers choice of more than one provider and those that will provide service to highest proportion of unserved residents

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The Power of 4G for the Smart Grid

Leading, Low-Cost, Open Standards-Based Standards Based, 4G Wireless Broadband Technology
Non-line-of-sight (NLOS) service into customer premise
> Ideal for hard-to-reach locations

500+ Members $ Millions Invested in Proven Technology

Strong, thriving ecosystem
> Intel, Cisco, Microsoft, Motorola, Siemens, Comcast, Alcatel > No vendor lock-in

Highly flexible bandwidth delivers cost-effective network build-out Multiple concurrent sessions, with full security Operable in both unlicensed and p licensed spectrum

Open standards
> WiMAX Forum, IEEE, IETF

Proven telecoms-grade reliability and scalability y y

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WiMAX Deployments Worldwide

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GE WiMAX Smart Grid Solution Partners

4G wireless communications network for ALL utility requirements

Advanced Metering, Demand Response, SCADA, Distribution Automation, Voice, and Mobile Real-time Outage and Fault Detection, and Real-time Service Restoration improving reliability

Utility & Wireless Carrier collaborative business models (Shared CAPEX / Outsourced OPEX)
Utility capital for WiMAX Network deployment O&M provided by Carrier with guaranteed SLAs

WiMAX SmartMeter by GE innovative, truly open, standards-based, smart meter

GE SmartMeter becomes a valued asset providing a broadband pipe at every home GE SmartMeter is gateway to the home providing advanced utility and customer energy services WiMAX Smart Grid Network collaboration changing the game for the utility & telecom industries

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WiMAX SmartMeter by GE
truly open, standards-based Smart Meter / Broadband Router

Advanced Metering
> Full featured ANSI C12.19 Smart Meter > Automated and On-Request Reads q > Meter Events, Alarms, and Reporting > Secure Remote Disconnect / Reconnect > Outage / Restoration Detection & Reporting > Remote Configuration & Firmware Upgrade > Demand Management / Load Limiting > On-Board Secure / Dynamic SOAP Server

Standards-based Strong Security Standardsg y

> EAP-TLS Authentication; WiMAX PKMv2 > Tamper-proof Crypto EEPROM Key Store > x.509 Digital Certificate based Identity > Meter Password Management

Broadband Access Router

> IPv4 / IPv6 Router; 802.1Q VLAN Switch > IP DiffServ and 802.1P QoS / CoS Services > DHCP, NTP, Firewall, Encryption > VPN Services TLS, IPSec
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Rural Connectivity - Summary

Enables advanced metering and broadband connectivity using one unit and one network Expedited implementation through shared use of existing assets (poles, right of way) Helps to accomplish multiple ARRA objectives Investing in the future Key benefits for utilities, consumers, smart grid Utilities Utiliti are able to better manage their assets and resources bl t b tt th i t d Customers are able to better manage energy use Less energy used gy Reduced emissions Win-win!
Electricity Smart meter/ Smart modem

Two connections
Internet Plug-in vehicle Solar Smart S t appliance s

Broadband network

one smart system

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Small Utility Generation Options

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DG with small renewables

Wind
Small wind <100kW unit Economical wind installation, using existing infrastructure

Solar
Residential, commercial and utility applications

Biogas
Gas engine power range: 0.25 MW 4 0 25 MW-4 MW Fuel flexibility: variety of renewable or alternative gases

AeroDerivative GT
Peaking application: technology to augment unpredictability in renewable power generation

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Electricity Cost by State, January 2009

WA 7.65 OR 8.41 ID 7.05 NV 12.23 UT 8.00 CA 14.95 AZ 9.51 CO 9.25 MT 8.44 ND 6.55 SD 7.58 NE 6.89 KS 8.16 IA 8.88 IL 10.78 MO 7.02 AR 8.94 MS 9.64 AK 17.25 TX 12.79 12 79 LA 8.92 FL 12.43 HI 25.76 TN 9.44 AL 10.31 GA 9.40 MN 9.59 WI 12.35 MI 11.17 IN 8.62 OH 9.39 KY 8.10 NH 16.29

VT 14.37 14 37

ME 16.03 16 03

WY 7.76

NY 17.46 PA 10.83 WV 7.40 VA 10.01 NC 9.45 SC 9.80

MA 18.12 RI 17.20 CT 19.49 NJ 15.8 DE 13.25 MD 14.40 DC 12.83

NM 9.54

OK 7.67

Residential Average Price (cents per KW) 6.00 7.99 8.00 9.99 10.00 11.99 12.00 15.99 16.00 26.00

Source: Energy Information Administration

Table 5.6.A. Average Retail Price of Electricity to Ultimate Customers by End-Use Sector, by State, January 2009 and 2008 (Cents per kilowatthour) 25

Biogas

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Biomass-to-power
Landfill Gas Waste Water Animal / Industrial Treatment Plants Bio waste Biomass Gasification

Fuel / Technology Total Est. Market

Methane from anaerobic digestion $1.4 $1 4 B

Methane from anaerobic digestion $0.54B $0 54B

Methane from anaerobic digestion $1.0B $1 0B

Syngas from gasification $15.6B $15 6B

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Gas engine
Unit size:
up t 4 MW / engine to i

Key benefits
Fuel flexibility: access to alternative fuel sources Access to renewable incentives (if biogas used) Fast deployment Flexibility in plant size: installation of multiple units Portable; skid mounted solution possible Hi h efficiency High ffi i

Source: Nexterra web site

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Biogas applications
Biogas sources Enabling technologies (available) Renewable power generation with gas engine

Forest industry (wood chips) Diary farm (animal waste) Industrial (industrial waste) Municipal WWTP Industrial WWTP Landfill gas
Biomass gasifier Digester

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Biomass gasification pilot

Source: Nexterra web site

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Solar

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Solar

Key benefits Continuous reduction in PV module cost Fast deployment Modular installation; flexible size Low infrastructure requirement on installation Power generation timing, matching the demand

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Solar potential in USA

1kW solar system (per 100ft2)

Zone Z Average monthly A thl kWh production range 80-90 90-100 105-115 115-125 125-135 125 135 135-145

1 2 3 4 5 6

Source: GE data
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Solar: PV application examples

18kW, Santa Maria de Roncesvalles Pomplona, Spain

129 kW, Shafer Vineyards CA, USA

10MW, Cceres Project Spain

Commercial C i l building

Residential R id ti l / Rural

Industrial

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Preparing for the Future PV grid parity is coming incentives 10% 40% 60% without 90%
Prob Prob Prob Prob

NJ IL GA CA

Commercial Residential Commercial Residential Commercial Residential R id ti l Commercial Residential 16 18 20 22 24 26 28 30

10-25% IRRs today in AZ, CT, HI, MA, NJ, & OR with IRR s AZ CT HI MA NJ incentives
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Big Boxes Adopting PV Solar

Wal-Mart Launches Solar Power Initiative W lM tL h S l P I iti ti
". . . provide as much as 20 megawatts of electricity, for prices less than it currently pays local utilities . . . solar p yp y power companies p y the upfront costs of p pay p installations and retain ownership of the systems, and enter long-term contracts Source: Fortune, May 07, 2007 to sell electricity to their customers."
Long Beach, CA Electricity Rate: $.145/kWh Contract 0.125/kwh.. 2.5% escalation 0 125/kwh 2 5% escalation .. 20 years years 390 KW $ 4.145/watt module cost. $6.10 install cost

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Residents will realize future savings

Breakeven Cash Flow Analysis using Home Financing
$/W (installed) 8 7 6 5 4 Breakeven Retail Rate (cents/kWh)* 18.8
y p (kWh) ) System output (

Calculations
Net capital cost ($) Annual payment ($) $/W * 1000 *4kWp Federal & State tax ITC Monthly payment (assuming interest is compounded monthly) * 12 + O&M 4kWp * 8760 hours * capacity factor p p y Annual payment / system output * 100

16.6 14.3 12.1 9.8

Breakeven ( /kWh)

Assumptions
Location: Atlanta System size: 4 kWp Capacity factor: 15% Debt terms: 25 years Cost of debt: 7% O&M (annual): $40 # hours/year: 8760 Federal ITC: 30% State ITC: 35%

* Resident achieves cash savings when retail electricity rate exceeds $/kWh value for 4kW system

Residential customers who finance PV in Mortgage can get Positive Cash Flow
Source: GE internal analysis

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Utility-Scale Solution Thin Film Complete Solar System Kit Example

Racking System Thin Film PV Modules GE Inverter Cabling Monitoring & Security

GE offers a 1.5MW solar power plant kit, designed for ease of installation, optimized for performance, and delivered with excellent GE execution and reputation t ti

System Specs 1.5MW

Area Efficiency Effi i No. of Modules Steel Posts Production System Life
10-14 Acres 8.5->12+ %CE 23,000 1,500 2,100 2 100 MWh/yr >20yrs

Plug & Play Advantages

GE Reliability & Execution Grid Friendly & GE Controls G d e d y G Co t o s Simplified & Scalable Cost Competitive Commercial Discussions 4Q08

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Small wind

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Small wind
Unit size: < 100kW /unit Key statistics
2008 Global small wind market
38.7MW 19,000 units $156MM (sales) 53% growth over 2007

Key benefits Ease of scalability Federal tax credit (30%) Further state incentives on renewables Utilization of existing infrastructure (Tower & grid connection) Swift installation

Players
Total 219 companies > 74 (US) > 145 (Others)

Projection
Source: AWEA Small Wind Turbine Global Market Study 2008

1.7GW 1 7GW in USA by 2013

Source: Southwest Windpower

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Small wind: Application examples

Residential applications li ti

Utility pole integration i t ti

Retail car park

Source: Southwest Windpower

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Small wind: State incentives

Source: AWEA Small Wind Turbine Global Market Study 2008

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AeroDerivative Gas Turbines

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AeroDerivative Gas Turbines

Unit size: 20 100MW Key benefits: Proven reliability and availability Fast load response Excellent starting reliability @ max load in <10mins Short installation time Small footprint; lightweight, compact design Dual fuel capability Outstanding low emissions High efficiency for simple & combined cycle, and cogeneration applications

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AeroDerivative GT + Wind
Traditional manual dispatch when generation is needed Deregulation/dispatch drives generation investment Grid system manages wind volatility and takes all it can get Managing real-time wind volatility through a smart controller Wind Intermittency Management System (IMS) Nodal market calls upon most efficient generation, high ancillary market Benefits/penalties for not meeting wind forecast

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AeroDerivative GT + Wind
Wind needs
o M lti l start/stop cycles Multiple t t/ t l without maintenance penalty o 10 minutes or less to full power The higher the ramp rate the better p o High simple cycle efficiency o High part power efficienc po er efficiency and low emissions o Remote operation

AeroDerivative GT Capabilities p
Proven AeroDerivative design Demonstrated plus 50 MW/min ramp rate without penalty p p y possible Best in industry is @ 44% Hot day H t d performance f Demonstrated

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AeroDerivative GT + Wind
Example: 400 wind + LMS100 (One representative week of good wind operation)
500.0 500 0

400.0

300.0

200.0 MW

Actual Wind LMS power

100.0

Forecast Wind (unbiased)

0.0

-100.0

-200.0 1 13 25 37 49 61 73 85 Hour
NW Miller 2/7/2007 Energy Consulting

97

109

121

133

145

157

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System integration

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Distributed generation: System integration

Equipment Small Solar Small Wind

CONVERSIO N LOAD STORAGE

Batteries

Inverter

T& D

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Managing the Grid

Planning Building Safety Reliability

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Summary

Unique opportunity to bring 4G WiMax technology to rural America NRECA and NRTC collaboration next generation networks Small Green Generation enabled Smart Grid reliability Partial Solution to Farm W t Issues P ti l S l ti t F Waste I

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