Making the business case for distribution automation is certainly getting easier these days. However, it’s not a no-brainer for all utilities. At Distribution Automation 2011 in New York City on Wednesday, Bruce Walker, Vice President of Gridwise Alliance, challenged the utilities in the audience to calculate the cost of not investing in DA.

“We stand on another precipice,” he argued.  “Let’s be clear: there are hundreds of millions of dollars available for grid improvements.”

For starters, get everyone in a room -- or at least form some working groups. Walker said he sees far too few utilities that involve stakeholders, from regulators to customers, from an early point. In San Diego, where San Diego Gas & Electric has been mandated to build a 10-year smart grid deployment plan, Lee Krevat said that bringing stakeholders to the table earlier was really valuable. At Gridwise Alliance, they’re expanding collaboration to include utilities from across the world -- as the lessons and challenges in Korea are vastly different than those faced in California or Pennsylvania. (For more on distribution automation, join Greentech Media at The Networked Grid, May 3-4 in San Francisco.)

Once you get some people on board, there are a handful of objectives that were identified by Stephen Summerville, General Manager of New Business Ventures, Arizona Public Service, and Camilo Serna, Director of Strategic Planning for Energy Productivity with Northeast Utilities. Northeast Utilities and APS are very different entities serving very different regions of the country, but their cases for employing DA largely overlap.

Optimize performance/improve system efficiency. From volt/var optimization to fault isolation, there are various business cases to be made. Summerville noted that reliability is relatively high in his territory, so upgrades that only improved reliability would not pay for themselves. In other markets, reliability improvements may pay for themselves, but the case also varies from residential to C+I customers. The average residential customer might feel service is adequate and might be reticent to foot the bill for upgrades. In the Northeast, Serna said that upgrades in efficiency were the biggest part of the business case because rates are already so high.

Enable alternative energy/distributed generation.  There is no doubt that for many utilities in states with aggressive renewable portfolio standards, the case for distribution automation makes itself. For distribution companies, they may not see any benefit to shaving peak load -- those savings go to the generation company that doesn’t have to fire up the peaker plant. But if feeders are overloaded and transformers are exploding because one neighborhood is filling up with electric vehicles, DA starts to make sense. “You can’t have RPS standards that will be executed if you don’t have concepts to integrate them into the system,” said Walker. Even for utilities that do not have a significant penetration of renewables or EVs, like Avista in Washington State, preparing for that future is part of its business case.

Improve organizational integration/advanced asset management. This concept was a little more nebulous for both utilities, but better sensing and monitoring allow for not only more efficient condition-based maintenance but also better sharing of information across different divisions within the utility. Do not underestimate the need for data management -- the key word being ‘manage.’

Outside of those three broad concepts, there was also talk about customer focus. While some large C+I customers might get jazzed up about feeder upgrades, I can assure you, your neighbor probably does not. But the improvements are allowing for new products -- APS is testing a few hundredsolarpanels on houses in Flagstaff that are connected to the utility side of the meter. So far the pilot has found that the installations pay for themselves. If customers know that distribution automation allows for such distributed generation programs, or how many HDTVs they can leave on in their house all day, there’s likely to be more support.

Even if consumer-facing advantages are not on the top of the business case, “distribution automation works. Let’s not pretend like it’s a new concept,” said Walker. He argued that the justification is there for every utility, and the time to get going is now. “Most regulators are amenable to upgrades in distribution automation,” he said.  “The level to overcome prudence is very low.”