U.S. Electric Power Utility Capital Investment in Grid Modernization:  Effects of COVID-19 Pandemic on Near-Term and Mid-Term Outlook

Interim Report By Charles Newton, Newton-Evans Research Company

This article has been developed based on findings from surveys completed by officials from 22 U.S. electric utilities comprising about 10% of served end-use customers.  To date, the mix of participating utilities includes several IOUs, along with public power utilities and electric cooperatives.

The study is being undertaken to determine the effects of the COVID-19 pandemic on utility grid modernization plans involving capital expenditures.  Newton-Evans has requested the participation of major and mid-size American electric utilities in an attempt to gauge whether or not CAPEX investments will continue to be made as planned earlier, and whether grid modernization projects will continue as scheduled or will likely be deferred for some time.

Figure 1 indicates that nearly one-half (48%) of the surveyed utilities continue to have plans to launch new smart grid projects either in 2020 or in 2021.

Figure 1.

 

Continue reading U.S. Electric Power Utility Capital Investment in Grid Modernization: Effects of COVID-19 Pandemic on Near-Term and Mid-Term Outlook

If you have insights into your utility’s plans for its near-term CAPEX planning affecting grid modernization projects, we request your help. . Newton-Evans will value your participation in our current study of the capital spending outlook for the nation’s electric utilities in light of the current pandemic.  Newton-Evans will retain your observations in confidence, and will provide you with a complimentary 40-page report of findings gathered from among electric power industry officials located throughout the United States.  The secure online survey is located here: https://www.surveymonkey.com/r/ElectricUtilCAPEXsurvey

Some reasons to participate include:

• Help industry manufacturers, T&D consultants and systems integration firms prepare to meet the nation’s electric utility demand for equipment and systems during late 2020 and 2021.
• Provide fellow utility planners to better understand specific grid modernization activities that IOUs, public power utilities and cooperatives are preparing to undertake.
• Keep up with industry trends by having your own copy of the highly regarded Newton-Evans’ CAPEX report to share with management in mid-May.

A special “thank you” gift is is also available for participants at the end of the 12-question (largely multiple choice) survey.  To date, we have well-thought-out responses in hand from major IOUs, public utilities and electric co-ops.  Looking forward to your survey participation, we thank you kindly for sharing your insights.  We are closing off survey data collection work on Friday, May 15, 2020.

 

November 8, 2019.  Ellicott City, Maryland.  With nearly 100 officials from 30 countries participating in the 2019 Newton-Evans study of trends in protection and control practices, there were some wide variations noted in the use of networking technologies across the world.

Among 55 North American utility respondents, the most prevalent networking technologies in use during 2019 included SONET/SDH (40%), T1/E1 (33%) and a mix of T1/E1, SONET and packet-based (33%). This seems to imply that SONET is the leading technology among the sample. However, the two networking technologies to watch out for in the next 4 years are IP/MPLS and SDN; 18% plan to use IP/MPLS and 15% plan to use SDN by 2022.

The most prevalent networking technologies used in 2019 among the 42 international utility survey participants included SONET/SDH (31%), Industrial Carrier Ethernet (29%) and IP/MPLS (26%). Based on the survey sample, the leading technologies planned for development by 2020 include MPLS-TP (29%) and SD-WAN (24%).

The Worldwide Study of the Protective Relay Marketplace in Electric Utilities: 2019-2022 measures current market sizes and contains projections on a world region basis for the next few years. More than 35 topics are covered in the utility survey portion of this study with participation from nearly 100 utility P&C officials from countries around the world.  The complete four-volume study of protection and control practices and trends is available from Newton-Evans Research Company.  Details are available at https://www.newton-evans.com/product/the-worldwide-study-of-the-protective-relay-marketplace-in-electric-utilities-2019-2022/ .

As of early April, much of the 2013 T&D research work already completed or now underway for clients has once again centered on fundamentals required for a more resilient power grid— that is, on “infrastructure building blocks” rather than on pure automation or IT.

While many observers continue to overlook the critical role of “widgets” — basic T&D grid components – – – that have themselves benefited from technical advances over the past decade, our research programs have included a number of studies of these components.  During the first quarter of 2013, we have come to understand that more reliable and greener components available in the newest generation of core grid products are indeed making headway in the North American Grid and throughout the world.

Currently, Newton-Evans staff is fully engaged in client studies researching the emerging roles being played by such basic grid components as power fuses, capacitor bank switches, and even the various improvements in transformer oils being used in the millions of power and distribution transformer installations in North America.  We are about to begin a private study of high voltage circuit breaker trends.

We have not overlooked “smart grid” developments, of course, being the earliest industry marketing research firm to study T&D control systems . . . beginning in 1981.  We have recently released the four volume 2013-2015 edition of the World Market Outlook for EMS, SCADA, DMS and OMS Systems.  For another private client we have already completed a detailed year-by-year history and eight year outlook for distribution automation in North America.

Another first quarter client study provided a major power utility client with the ability to measure the opinions, attitudes and experiences of other electric utility operations officials regarding the pros and cons of alternative data communications infrastructure choices for operational data acquisition. These report findings enabled our client to make an educated decision about how to proceed with its own communications infrastructure upgrades.

The findings presented in the project report were based on a survey sent out to large electric utilities around the world. Utility officials involved in communications network planning or oversight from more than 15 countries responded to the survey. While not all participating utilities operated control systems that are configured with multiple control centers, survey participation and informative feedback was welcomed from everyone.

Illustrative diagrams were included throughout the survey to guide respondents into thinking about four specific network communications scenarios being considered by the client utility. After being presented with the diagrams and descriptions, survey respondents were asked a series of questions including, “What scenario do you think will offer the best opportunity to accomplish the following:”

• transition easily to an IP data infrastructure with better cost control and reduced latency
• transition easily to a better data acquisition infrastructure using synchrophasors (PMUs)
• easily update data points over the network & synchronize the updates with other systems

In early June, one of our clients will be hosting an exclusive afternoon reception and discussions of advanced cyber security and related compliance topics, with speakers from NIST and ENERNEX among others.  Newton-Evans will soon be sending out invitations to selected utility officials from the mid-Atlantic area.  Qualified senior utility officials, who may be interested in learning more about defense-in-depth file transfer techniques between various operational systems and multiple enterprise systems, can contact us for an invitation to attend this small group event which will be held in suburban D.C.  The seating for this event is limited; there is no cost for attendees (other than transportation).

This event promises to be another great way to learn more about the implications of the new 2013 cyber security executive order for critical infrastructure, as well as receiving updates to NERC compliance topics, and how advanced cyber technology developments will transfer from one usage sector to the electric power industry to secure file transfers between operational control systems and IT systems.

During the summer months, Newton-Evans will be “going global” once again with its fifth edition of the CAPEX/OPEX outlook among the world’s electric power utility community.  Concurrently, we expect to be underway with a major update to our historical compilations of distribution automation developments and trends.

Newton-Evans’ CEO, Chuck Newton, has been selected by Energy Central to serve as the Operations Track Chair for this autumn’s KNOWLEDGE 2013 Conference, scheduled for November 4-6, 2013 at the exclusive Broadmoor Hotel and Resort in Colorado.  We are looking for a few additional senior level Operations/Smart Grid people to serve as program committee members.  The KNOWLEDGE Conference is known for its attractiveness to C-Level executives and other senior managers who are afforded the opportunity to have open discussions and dialogue with peers on IT and CIS topics in a relaxed setting.  We hope to make the Operations track a vital new component of this exclusive conference.

Finally, during the first quarter, Newton-Evans contributed articles to the following publications:

Intelligent Utility (March 13, 2013 edition) “Current, Planned Global Deployment of Analytics Capabilities”

Utility Horizons Quarterly (April, 2013 edition) “Usage Patterns and Trends in Electric Utility Automation”

Transmission & Distributions WORLD (May 2013 edition) “Special Supplement Communications: “Assessment and Outlook for Telecommunications Networks and Protocols in the World’s Electric Power Utilities”

In addition, our latest global control systems studies received coverage on a number of financial news sites around the world as well as in the following industry publications:

Transmission and Distribution World – Online – Feb 20, 2013
“Global Spending for Power Delivery Control Systems for 2012-2015 Likely to Exceed $5.5 Billion” http://tdworld.com/smart_utility/newton-evans-delivery-study-0213/#ixzz2LT9GejmD

Renew Grid – February 19, 2013
“North American Utilities Lagging On Standards And Best Practices”
http://www.renew-grid.com/e107_plugins/content/content.php?content.9586#.USUiB1f_qsk

Smart Grid News – February 15, 2013
“Study reveals U.S. utilities falling behind in adoption of essential best practices”
http://www.smartgridnews.com/artman/publish/Technologies_Standards/Study-reveals-U-S-utilities-falling-behind-in-adoption-of-essential-best-practices-5517.html/?fpt#.USUhWlf_qsk

PowerGrid International, January, 2013
“Newton-Evans:  EMS, SCADA, DMS, OMS Likely to See Much Growth Through 2015″
Print Magazine article (page 20)

 

Standards Compliance for Many Systems Components Important Internationally while Surprisingly High Level of Interest in NERC CIP Compliance Reported From Outside of North America

 

February 12, 2013.  Ellicott City, Maryland.  The Newton-Evans Research Company has released its 2013 edition of a four volume study of EMS, SCADA, DMS and OMS usage patterns in the world’s electric power utilities.  This release marks the tenth such research program in this series completed since 1984.

Newton-Evans staff conducted surveys and interviews with more than 150 utilities in 37 countries.  These included many of the TOP 100 utilities in the world.  Among the observations gleaned from interviews and surveys with these utilities, along with views from control systems integrators and power delivery consultants are these:

Rationale for Increased Spending on Control Systems:  A number of factors were cited by participants as the basis to support the increased levels of systems augmentation, upgrades and replacements over the next 36 months including the need for new applications to improve operator visualization and situational awareness; adding redundancy to communications pathing; improving cyber defenses; complying with new regulatory mandates; and in some instances, a desire to combine two or more systems onto common platforms.

Differences in International and North American perspectives and approaches to Standards for control systems:  The role of international standards is more important to utilities outside of North America than to domestic utilities.  While IEC standards compliance dominates systems procurements and communications approaches internationally, in North America the roles of IEEE, ANSI, NEMA and de facto standards play a much more important role. Forty percent of international respondents indicated having a requirement for OPC (Open Platform Communications) compared with only 27% of North American replies.  Similarly SOA (Service Oriented Architecture) was viewed as being much more important internationally than was reported by North American respondents. Two-thirds of international utilities and 19% of North American utilities reported interest in using CIM standards for model maintenance related to distribution circuit design transfers from GIS (Geographical Information Systems) to DMS.

Similar Levels of Concern with Cyber Security: Eighty percent of North American utility officials and 82% of international utilities cited a need for cyber security features to be designed as an integral part of their control systems, not provided as an “add-on.”   Interestingly, many international utilities are modeling their cyber security mandates for power delivery control systems on North America’s NERC CIPs.  Across the world, several utilities also called for control systems integrators to do more to make NERC (and other) compliance and regulatory reporting easier and more automated.

Third Party Control Center Services:  Consulting services are being used and more likely to be relied upon to assist with expanding NERC CIP compliance issues, for the conduct of vulnerability assessments and for consulting on smart grid topics.  In addition, several comments were directed toward the increased reliance on third party services to assist utilities as they cope with workforce retirements in their operational control centers.

Role of Operational Analytics:  Noticeable differences in current and planned usage of operational analytics were found for asset analytics, DMS analytics (load and voltage balancing et al) and customer analytics.  Each of these are now being used (or soon will be) more widely internationally than in North American utilities.  OMS analytics (e.g., fault location) are of similar levels of usage and plans among both groups.

The four volume study includes separate reports on (1) North America with details by type of utility, (2) International community with detailed findings by world region; (3) Profiles of leading systems integrators and (4) World regional market outlook for each type of power delivery control systems through 2015.  The complete set of reports is available for $7,500.00, and individual reports are also available for online ordering.

Further information on this new series entitled The World Market Study of SCADA, Energy Management Systems, Distribution Management Systems and Outage Management Systems in Electric Utilities:  2013-2015 is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042. Phone: 410-465-7316 or visit us at www.newton-evans.com  to order this series or any of more than 100 related reports. Chuck Newton can be reached at cnewton@newton-evans.com.

EMS, SCADA, DMS and OMS Systems to be Significantly Upgraded or Replaced to Meet New Regulations and to Provide Improved Situational Awareness and Visualization Tools for Systems Operators

Role of Operational Analytics for Outage Management Growing Rapidly in Attempts to Improve Reliability and Minimize Outage Duration and Frequency

January 25, 2013.  Ellicott City, Maryland.  The Newton-Evans Research Company has released highlights of findings from its newly published study of EMS, SCADA, DMS and OMS usage patterns in North American electric power utilities, one of four component reports of the company’s 2013 global market assessment series on power delivery operational control systems.

Among the observations gleaned from interviews and surveys with more than 110 participants from a wide range of participating U.S. and Canadian electric utilities, are the following:

• Plans call for upgrades or retrofits to EMS (energy management systems) and SCADA (supervisory control and data acquisition) systems among a large percentage of these utilities.  Related industry expenditures will likely increase by more than 25% over the next 24 months.
• Plans for procurements of new DMS (distribution management systems) and OMS (Outage management systems) are significant, with more than one quarter planning to purchase a new or replacement DMS and nearly one-in-five planning OMS procurements.
• Eighty percent of utility officials cited a need for cyber security features to be designed as an integral part of their control systems, not provided as an “add-on.”  Most officials also called for control systems integrators to do more to make NERC compliance and regulatory reporting easier and more automated.
• Third party services are being used and relied upon to assist with NERC CIP compliance issues, for the conduct of vulnerability assessments and for consulting on smart grid topics.
• DNP 3 continues to be the most prevalent operational data communications protocol throughout North American electric power utilities.  Plans call for continuing the use of DNP 3 for the foreseeable future, among the majority of these utilities.   Increased use of IEC 61850 for intra-substation communications has been reported in newly constructed transmission substations.

The North American report is one of four volumes of study completed for the company’s fourteenth bi-annual series of EMS, SCADA and DMS studies published by Newton-Evans Research since 1984.

Further information on this new series entitled The World Market Study of SCADA, Energy Management Systems and Distribution Management Systems in Electric Utilities:  2013-2015 is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042. Phone: 410-465-7316 or visit us at www.newton-evans.com  or to order any of more than 100 related reports.  For readers interested in purchasing this new series please call or email the company for special introductory pricing. Chuck Newton can be reached at cnewton@newton-evans.com.