How to Stay Amped Up in the World of Grid Connection

How to Stay Amped Up in the World of Grid Connection

The advent of electricity revolutionised the modern world, connecting communities and powering industries. Central to this interconnected network is the grid. A vital infrastructure that facilitates the flow of electricity from generation sources to consumers.

In this post, we explore grid connections, how electricity flows through the network, its challenges and opportunities.

What is a Grid Connection?

A grid connection is a system of interconnected power lines, substations, and other electrical components. Together they enable the transfer of electricity from power plants to homes, businesses, and institutions. This interconnected network serves as the backbone of modern energy distribution and facilitates a reliable supply of electricity for society.

Electricity Flow and Levels

Electricity flows through the grid at various levels, starting from large power plants that generate electricity at high voltages. This high-voltage electricity is then transmitted over long distances through high-voltage transmission lines to substations. Substations step high voltages to lower voltages and vice vers for distribution. The distribution network further subdivides the electricity into lower voltages suitable for residential, commercial, and industrial consumption. This hierarchical structure allows for efficient and seamless energy distribution across vast distances.

National grid networks step up voltage for transmission and step down voltage for usage. Source: NEED.org Electricity (2019)

The Evolution of Grid Connection in the USA

The USA power grid is considered one of the formative examples of how to transmit power across a vast geography. In the late 1800s and early 1900s, industrialisation and urbanisation caused a rapid increase in US electricity demand. This necessitated the creation of a comprehensive grid system to connect power generation sources with consumers across the country.

In 1882, Pearl Street Station in New York City was constructed. Spearheaded by Thomas Edison, this groundbreaking project was the first centralised power plant in the world. The plant initially supplied electricity to local businesses and residences. Pearl Street Station was a catalyst for establishing more power plants in other cities, each serving a limited geographical area.

Pearl Street Station sketch c. 1882 and 1890

The Niagara Falls Adams Power Plant Transformer House built in 1895 marked the beginning of long-distance power transmission. The electricity generated from the falls was transmitted over a distance of 26 miles to Buffalo, New York. This achievement laid the groundwork for the construction of high-voltage transmission lines and the expansion of the national grid system.

By the 1920s, significant progress was made in interconnecting regional power systems. Samuel Insull, a utility business magnate, played a crucial role in consolidating numerous small utilities into larger integrated holding companies. These holding companies enabled the exchange of electricity across state lines, creating a more unified and efficient grid system.

In the New Deal era of the 1930s, federal government took a proactive role in advancing the national grid system. President Franklin D. Roosevelt signed the Federal Power Act in 1935. This act granted the Federal Power Commission (now the Federal Energy Regulatory Commission) authority to regulate interstate transmission and sales. Additionally, the Rural Electrification Administration (REA) was established to bring electricity to rural areas.

A Bumpy Road to Power

However, fully interconnected national grid networks are not always the cleanest power transmission solution. Dr. Julie Cohn, who works as a Research Historian at the University of Houston, discusses the brief attempt to create a North American interconnected grid during the 1960s and early 1970s in her article ‘When the Grid Was the Grid: The History of North America’s Brief Coast-to-Coast Interconnected Machine‘ (Proceedings of the IEEE, 2019). The attempt was not as successful as utility companies and politicians hoped.

Constant challenges arose in maintaining parallel operations between the mismatched networks. Tripping of lines occurred frequently. On November 9, 1965, massive power failure occurred. More than 30 million people in 11 states and parts of Canada were affected. Thomas Weaver, former executive with the Western Area Power Administration, described the efforts as “some fancy brilliant schemes” ultimately doomed for failure.

Today the USA operates with 3 grid systems: the Western Interconnect (West of the Rocky Mountains), Eastern Interconnect (East of the Rocky Mountains) and Texas Interconnect.

The USA operates with 3 different grid systems. Source: EPA.gov (accessed August, 2023)

DNO and IDNO: Understanding Distribution Network Operators

Distribution Network Operators (DNOs) and Independent Distribution Network Operators (IDNOs) play a crucial role in managing and maintaining the distribution networks. DNOs are responsible for delivering electricity to consumers within specific geographical regions, ensuring the reliable supply of electricity. IDNOs operate outside the designated DNO territories and contribute to increasing competition and flexibility in the energy sector.

Lenders’ Confidence in National Utilities

Securing a stable grid connection is crucial for lenders to gain confidence in financing energy projects. Lenders evaluate creditworthiness of offtakers. They assess the probability of default, which directly impacts the overall credit risk associated with the project. Factors such as the offtaker’s financial health, transaction tenor, and the terms of the Power Purchase Agreement (PPA) play a pivotal role in determining the risk of potential defaults.

While a national grid connection is generally considered a less risky offtaker than private, creditworthiness of governments are still under scrutiny. In many emerging markets, government entities are the primary PPA off-takers. Unfortunately, there have been instances where government-owned utilities have faced financial challenges, leading to delayed or default payments.

Technical Aspects to Secure Grid Connection

When evaluating the secure grid connection and lenders’ confidence, several grid and country-specific technical aspects related to the impact of new generation schemes on the existing grid network need to be considered. These factors include thermal capacity, voltage rise/drop, fault levels, harmonic emissions, and voltage fluctuation. Grid operators must assess the impact of the new generation scheme on the network’s thermal limits, voltage profiles, and fault levels to ensure stable operation. Managing harmonic emissions and voltage fluctuations is critical to maintain power quality and avoid interference with other electrical devices.

Technical risks are assessed with grid impact studies, conducted during the planning and development of new generation projects. These studies assesses compatibility with existing grid infrastructure and identifies any necessary upgrades or modifications.

By considering both the financial and technical aspects and conducting comprehensive risk assessments, credit evaluations, and grid impact studies, project developers and lenders can gain confidence in the grid connection’s stability and overall viability of the energy project. The focus on evaluating offtaker creditworthiness, technical grid compatibility, and regulatory environments enables the seamless integration of new generation schemes.

Opportunities in Emerging Markets

Despite the hurdles, emerging markets present immense opportunities for grid connection projects. As these regions undergo rapid urbanisation and economic growth, the demand for reliable electricity supply surges. To address these challenges, innovative solutions, including decentralised renewable energy systems and microgrid technologies, have emerged as viable alternatives to complement traditional grid connections.

USA’s tri-grid system was built in stages. First, by constructing power plants which distributed power to areas via mini-grids and then by interconnecting these mini-grids with larger capacity transmission lines. In the paper ‘A Retrospective Analysis of Energy Access with a Focus on the Role of Mini-Grids,’ Korkovelos et al. spotlight the role of mini-grids in evolving the power system in the state of Pennsylvania. Looking at grid sketches in the paper from 1900-1930, you can see the initial isolated mini-grid systems expanding and joining to form an interconnected web. Emerging markets should follow a similar development model.

Power lines are elevated to protect them from potential damage, reduce the risk of accidental contact, facilitate maintenance and repairs, and prevent obstructions that could interfere with the transmission of electricity.

Power stakeholders in emerging markets should focus on investing in grid connection infrastructure and operation. Coordinating major load control centers, supply lines, enhancing operating techniques, and providing training for operators and dispatchers are all vital steps. By taking these steps, emerging markets can pave the way for reliable and efficient grid connections, facilitating progress and success in their power systems.

Conclusion

Grid connections form the backbone of modern electricity distribution, empowering nations with a reliable and efficient energy network. A transformational journey is underway to electrify communities in emerging markets. These markets continue their progress towards grid integration, bolstering industries, and driving sustainable development. With innovative approaches and collective efforts, the immense potential of grid connection can illuminate the path towards a brighter future.


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