Renewable energy sources like solar and wind have the potential to strongly contribute to our electricity mix in years to come. To get a better grasp on how solar and our electrical grid work together, I sat down with Gary Paul and Andy Roehr, both Vice Presidents of Capgemini’s Smart Energy Practice in North America.

The smart grid is one of the “key applications” we need in order to scale solar energy. But how do we get to a point where the grid starts to evolve and modernize? Paul and Roehr both agree that our first step is to promote decoupling.  Now, most utility’s profits are linked directly to how much electricity is sold. Capgemini’s extensive research has found that we need to break this link and instead create direct incentives for demand side management and energy efficiency that are equal to or better than incentives for energy production. As Roehr puts it, if we are able to “classify conservation as having a monetizable economic impact,” then we will be better able to align decision makers and investors in instituting policies that encourage smart grid growth. Paul adds that the basic fundamental to be put in place is

…[e]nergy policy that supports utilities to make the same kind of returns for saving energy as they do for producing and delivering energy.

This is the first step we must take in getting a smart grid off the ground.

When we got to talking about solar energy in particular, Paul and Roehr believe that increases in distributed solar power (such as rooftop PV) will mostly affect the lower-voltage distribution part of the grid. The more that comes online, the more we will be driven to have command and control capabilities in order to safely manage how the clean electricity feeds into the grid. By placing clean solar energy close to its source of consumption (the home or office building), these “microgrids” will enable us to optimize the way we deliver energy. Paul points out that they will also help us optimize the way in which we use and consume water – a component of the smart grid and energy use that is just beginning to step into the conversation.

Capgemini is one of the first groups to tackle smart grid implementation through a partnership with Hydro One in Ontario. Beginning in 2005, the groups launched an Advanced Metering Infrastructure (AMI) initiative to install smart meters in every home and small business. Paul and Roehr admit that they all learned a lot from this experience, particularly with regard to security issues and how to stay abreast of ever-evolving technologies. It’s a good thing NIST just released 77 interoperability standards, so that older devices will be able to communicate with newer ones as they penetrate the marketplace. To learn more about Capgemini’s smart grid experience with Hydro One in Ontario, check out this neat video.