Lines companies in good position for network-building

Ken Sutherland, CEO of Unison. Photo / Hawke's Bay Today

A freezer capable of turning itself on and off to take advantage of cheap power rates. A home heating system monitored and controlled remotely over the internet. A rooftop solar panel that feeds unused electricity back into the national grid.

These are some of the innovations electricity lines companies are promising consumers as they ramp up efforts to transform their traditional copper line power networks into sophisticated communications infrastructures infused with fibre-optic cabling.

The "smart grid" concept is gaining traction internationally as regulators look to encourage more sustainable electricity generation and distribution, and power companies grapple with the need to replacing ageing, inefficient network equipment.

Lines company interest in investing in smart grid technology has been fuelled by the Government's plans to spend $1.5 billion on a national fibre-optic broadband network over the next decade.

Lines companies are bidding against telcos to build the network, arguing their network building experience and growing fibre-based smart grid footprints make them ideally placed to complete the project.

Ken Sutherland, chief executive of Unison, which has a lines network in Rotorua, Taupo and Hawkes Bay, says the company has embraced the smart grid concept because it enables a new range of services to be made available to consumers, and also allows much more effective monitoring and management of the electricity network.

While Unison will not begin offering "smart meter" services to consumers until next year - allowing them to control their power consumption more effectively - the company is already benefiting from the fibre network monitoring its grid.

In February, its fibre-based "ultra-fast protection" system picked up and isolated a network fault which otherwise could have caused $1 million of damage to a transformer.

"We've had to put in place a fundamental communications platform to provide the capability to pool all that [network monitoring] information. In doing that we've created a fibre backbone to our network," says Sutherland.

"In putting that fibre backbone in, we were conscious that the effort and the cost of extending that fibre capability for a telecommunications platform was relatively sensible. It was a very good opportunity for us to leverage off."

He says the company has been spending about 25 per cent more on its fibre network build to bring it up to "carrier grade" standard.

"When you're looking at the long term view of how that communications platform can work from an electricity point of view, then it was a small step for us to take it into a carrier grade capability and provide telecommunications services on an open access network platform.

"So the smart grid initiative has leveraged us into the telecommunication network provision space."

Simon Mackenzie, chief executive of Vector, says the Auckland lines company has installed about 200,000 smart meters across the region and will eventually increase that number to 550,000.

He says they are being used by retailers Genesis and Contact Energy and will deliver benefits to both customers and retailers.

"Where customers would see benefits would be around things like they won't have incorrect estimates of their bills. They'll have accurate billing information so we certainly know that retailers can save a lot of costs on call centres and the like," Mackenzie says.

"There is a much simpler information flow to customers if they have queries.

"Each of these devices has an IP address [an internet connection via Vodafone's cellular network] so they can be interrogated very quickly. That can also allow us to identify where outages are occurring on the network so we can more quickly respond and deliver a better service."

Mackenzie says the full potential of smart grids has yet to be realised.

"At this stage we're in the phase of building out a large scale and pretty technically complex infrastructure," he says.

"Off the back of that we're starting to see the retailers and network companies say: 'Hey, there's a number of different ways that we haven't even considered that we could utilise this data or these communications channels to provide better service or solutions to customers'."