Benefits of the Smart Grid

Benefits of the Smart Grid — PDF document

This paper presents the benefits of the Smart Grid and describes how the Smart Grid generates these benefits. Overall benefits are also presented from the perspective of beneficiaries to illustrate how compelling the value proposition can be. These benefits will result from improvements in the following six key value areas:

- Reliability — by reducing the cost of interruptions and power quality disturbances and reducing the probability and consequences of widespread blackouts;

- Economics — by keeping downward prices on electricity prices, reducing the amount paid by consumers as compared to the “business as usual” (BAU) grid, creating new jobs, and stimulating the U.S. gross domestic product (GDP);

- Efficiency — by reducing the cost to produce, deliver, and consume electricity;

- Environmental — by reducing emissions when compared to BAU by enabling a larger penetration of renewables and improving efficiency of generation, delivery, and consumption; - Security — by reducing the probability and consequences of manmade attacks and natural disasters; and

- Safety — by reducing injuries and loss of life from grid-related events.

The transition to the smart grid is fundamentally driven by market forces. The smart grid’s ability to improve safety and efficiency, make better use of existing assets, enhance reliability and power quality, reduce dependence on imported energy, and minimize costly environmental impacts are all market forces that have substantial economic value. Recognizing these many attributes, the American Recovery and Reinvestment Act of 2009 (ARRA) was designed to provide additional stimulus, to accelerate the smart grid transition, and thereby realize the benefits sooner. Available at http://www.smartgrid.gov/sites/default/files/pdfs/understanding_benefits.pdf