Smart Grids Roadmap - Smart Grid Sherpa

Key findings• The development of smart grids is essential ifthe global community is to achieve shared goalsfor energy security, economic developmentand climate change mitigation. Smart gridsenable increased demand response andenergy efficiency, integration of variablerenewable energy resources and electric vehiclerecharging services, while reducing peakdemand and stabilising the electricity system.• The physical and institutional complexity ofelectricity systems makes it unlikely that themarket alone will implement smart grids on thescale that is needed. Governments, the privatesector, and consumer and environmentaladvocacy groups must work together to defineelectricity system needs and determine smartgrid solutions.• Rapid expansion of smart grids is hinderedby a tendency on the part of governmentsto shy away from taking ownership ofand responsibility for actively evolving ordeveloping new electricity system regulations,policy and technology. These trends have led toa diffusion of roles and responsibilities amonggovernment and industry actors, and havereduced overall expenditure on technologydevelopment and demonstration, and policydevelopment. The result has been slowprogress on a number of regional smart gridpilot projects that are needed.• The “smartening” of grids is already happening;it is not a one-time event. However, large-scale,system-wide demonstrations are urgentlyneeded to determine solutions that can bedeployed at full scale, integrating the full set ofsmart grid technologies with existing electricityinfrastructure.• Large-scale pilot projects are urgentlyneeded in all world regions to test variousbusiness models and then adapt them to thelocal circumstances. Countries and regionswill use smart grids for different purposes;emerging economies may leapfrog directly tosmart electricity infrastructure, while OECDcountries are already investing in incrementalimprovements to existing grids and small-scalepilot projects.• Current regulatory and market systems canhinder demonstration and deployment of smartgrids. Regulatory and market models – suchas those addressing system investment, pricesand customer participation – must evolveas technologies offer new options over thecourse of long-term, incremental smart griddeployment.• Regulators and consumer advocates needto engage in system demonstration anddeployment to ensure that customers benefitfrom smart grids. Building awareness andseeking consensus on the value of smartgrids must be a priority, with energy utilitiesand regulators having a key role in justifyinginvestments.• Greater international collaboration is neededto share experiences with pilot programmes,to leverage national investments in technologydevelopment, and to develop common smartgrid technology standards that optimiseand accelerate technology developmentand deployment while reducing costs for allstakeholders.• Peak demand will increase between 2010 and2050 in all regions. Smart grids deploymentcould reduce projected peak demand increasesby 13% to 24% over this frame for the fourregions analysed in this roadmap.• Smart grids can provide significant benefitsto developing countries. Capacity building,targeted analysis and roadmaps – createdcollaboratively with developed and developingcountries – are required to determine specificneeds and solutions in technology andregulation.Key findings5© OECD/IEA, 2010