Information Use in the Operations of the Smart Grid

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The smart grid is the integration of the information technology (IT) infrastructure across the electric power supply chain. It starts with smart appliances (HVAC, home appliances) connected to smart meters that provide IT-based continuous power consumption measurement and other data from customers, relayed to distributors. Distributors dynamically adjust their power requirements from the generation and transmission infrastructure. Critical is that electricity cannot be stored economically, making the electric power supply chain a no-inventory just-in-time system where IT-based coordination can have a substantial impact.******This proposed research studies the smart grid in three stages: ******The first stage is to model the development and adoption of the smart grid metering technology by customers as well as the IT infrastructure conversion required through the electric power supply chain. The operational benefits of the smart grid can only be obtained if there is a high level of technology adoption and conversion. Consequently, with a smart grid the electric power supply chain can implement real-time visibility of power generation and use information, allow all supply chain echelons to adjust operations dynamically to supply and demand, and have the monitoring capability to react to performance dips and spikes.******The second stage is to determine methods that can be used to balance load across the power grid with the enhanced information provided by the smart grid. This is called "demand response" where customers reduce or shift some of their electricity demand from peak periods in response to differential prices. We will extend this stage to examine the impact of the smart grid on longer-term electric power supply chain capacity. This is critical because additional electric power infrastructure for generation (power plants) and transmission (high voltage lines) needed to satisfy peak demand is expensive. ******The third stage is to study the operational implications of decentralized electric power generation. As renewable and local power generation become more efficient, customers can supply and consume power. A deep feature of the smart grid is the IT support for metering in both directions, dynamically reversing the orientation of the electric power supply chain. The consequences of customers providing locally generated electricity to the power grid are poorly understood, and involve tradeoffs between centralized and decentralized decisions. ******The results from this research will contribute to knowledge in information systems, in supply chain management, and in the practical setting of the smart grid. This setting represents an opportunity to improve energy efficiency with IT that can benefit all Canadians.