Download Innovative ICT Empower a Better Connected Smartgrid

Innovative ICT Empower a
Better Connected Smartgrid
White Paper
Marcus Torchia
August 2014
Sponsored by: Huawei
Innovative ICT Empower a Better Connected Smartgrid
IDC ENERGY
INSIGHTS OPINION
IN THIS
WHITE PAPER
The business challenges that the power utility industry faces today are dynamic and regionally diverse.
Utility services are evolving in response to realities in both emerging and mature economies. Informed
and increasingly resource aware customer bases have a growing interest in energy conservation and
resource diversity. At the same time, utilities are under pressure to reduce costs, streamline operations
and meet more stringent regulations for national infrastructure security and environmental goals. By
strengthening the information and communications technologies (ICT) in the grid, the power of a smart
grid shapes the future capabilities of utility infrastructure and services.
The next stage in innovation and growth in ICT for utilities users in high impact technologies of big
data and analytics, cloud, mobility and the Internet of Things. These technologies enable smart grid
investments in strategic programs that span reliability, security, energy efficiency, and retail services.
Projects include distribution automation, smart metering, demand response, electric vehicle charging,
small-scale renewable generation, and dynamic pricing to name a few. And these projects are leading to
a convergence of information and operational business processes (IT/OT convergence). It is imperative
that the ICT infrastructure remain flexible under these changes.
Huawei Technologies Co.,Ltd develops enterprise ICT infrastructure and applies them to industry
including power utilities. The company’s technologies in this paper are aligned to the transmission,
distribution and IT business challenges faced today. Huawei brings to the industry strength in product
performance for ICT infrastructure including carrier scale performance in communication networks,
network and data security, data storage, and hardened equipment for any operating environment. The
two Huawei customers, Hubei Electric Company and Zhuhai Electric Power, highlight examples of smart
grid projects with different business driver and solution needs.
The ICT infrastructure of the future power utility needs to be able to transport and direct accurate,
reliable, and secure data to and from the field, the customer premise, the control center and outside
points to optimize operational systems and support market functions. Both mission critical and nonmission critical applications also have to be supported. Infrastructure that runs analytics, cloud
computing, mobile and even social media, needs to be scalable and secure for communicating and
storing data. We recommend that utilities ensure that its governance structure allows and promotes
its IT and the lines of business to work together closely to identify major business objectives and begin
discussions on enabling technologies. Make this connection at all levels of the organization to ensure
the success of technology deployment and at the highest level (i.e. executive sponsorship) at the earliest
stages.
In the IDC Energy Insights White Paper sponsored by Huawei Technologies Co.,Ltd we lay out the electric
global power industry business drivers for information and communication technology (ICT). We discuss
the innovative ICT technologies IDC includes in its Third Platform model along with the trends we see in
utility use. We then discuss the major trends in the transmission distribution and IT businesses and an
overview of solutions Huawei brings with reference customers to provide examples.
Innovative ICT Empower a Better Connected Smartgrid
SITUATION OVERVIEW
TABLE OF
CONTENTS
The business challenges that the power utility industry sees today are dynamic and regionally diverse.
The utility service model is evolving to more effectively integrate new distributed resources while better
serving customer bases that have a growing interest in energy consumption and service provider quality.
The impact on the utility industry creates opportunities to transform operating processes while evolving
the prevailing business models with new value centers.
At the same time, utilities are under pressure to reduce costs, streamline operations and meet more
stringent state and national regulations in security and environmental goals. By strengthening the
information and communications technologies (ICT) in the grid, the power of a smart grid shapes the
future capabilities of utility infrastructure and services. Today, and in the future, the power utility industry
is driven by business imperatives that are enduring for the next decade and longer.
Industry drivers for Power Utilities
01
05
Situation Overview
Industry drivers for Power Utilities
Innovative Trends in the Utility Industry
driven by The Third Platform
Infrastructure Vantage Point
Future outlook
Huawei in Utilities
A Converged Network to Interconnect
Transmission
Sensing and Control on the Rise in
Distribution
Managing the Data, Securing the IT
Enterprise
10
Case Studies of Huawei
customers
Zhuhai Electric Power
Hubei Electricity Company
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Challenges and
Considerations
Globally, power utilities operate in diverse market conditions with varying levels of government
regulation, economic growth, and infrastructure maturity. With global perspective in mind, what are
the shared industry drivers leading to utility technology investments? The following provides a summary
perspective.
•
Increasing asset utilization: In markets with mature utility businesses, the need for more efficient
operations is a key business driver for future technology investment. Generation capacity, for
example, is driving higher utilization rate by running plants longer and harder, increasing operating
levels from 70-75% (common in Asia region and developing countries) to 80% peak maximum
output (common in NA, Europe, and industrialized countries).
•
Optimizing grid operations: Smart grid enables power delivery efficiencies that are sorely needed
to reduce levels of standby generation and improve peaking period constraints. Equipment sensing
and control have been available for decades, however, as a manual decision process, results are
limited and only the most critical equipment. Grid optimization relies on automation through an
expanding grid's edge of smart devices and robust networks and made possible through analytics
using realtime and near real time grid data. Optimization technologies are essential to manage the
inherent intermittency of distributed energy resources, which are proliferating globally.
•
Improving reliability: Reliability improvement goals partly drive investments in grid infrastructure
for more stable generation to faster recovering distribution equipment. The case for smart grid
investments to improve reliability is backed by the desire to create a satisfied customer, both
commercial and residential. In some regions, like parts of coastal Europe, recent investments for
reliability are driven by historically powerful storms. In other areas, like developing countries with
growing tourism economies, reliable service improves the customer experience.
Essential Guidance
for Utilities
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Innovative ICT Empower a Better Connected Smartgrid
•
•
Managing demand: Utilities have a keen interest to manage the demand side to economically and
efficiently maintain grid balance and operating parameters during peak times. While consumer
influence on the utility business is multifaceted, utilities are involving consumers with more options
to curtail and shape usage patterns at the home with networked smart meters and intelligent
in-home controls. At the same time, consumers are increasingly purchasing distributed energy
resources (DER) such as solar arrays and electric vehicles.
Energy saving and reduce green house emissions: State and country green house gas (GHG)
emission regulations continue to place higher but attainable goals. A proportionate share is falling
on the utilities to seek solutions to support emission targets and increasingly a mix of solutions are
used to offset generation including consumer demand management, capacity demand response
and distribution optimization.
To meet the imperatives that these industry drivers catalyze, the utility relies on using a mix of business
systems and control systems to support the fundamental utility processes in operations, customer
service & marketing, finance and (wholesale) market operations. Building upon that infrastructure with
innovative technologies, these systems must be able to adapt to new business realities. Let's take a look
at the innovative technology developments trending in the power utilities industry.
Innovative Trends in the Utility Industry driven by The Third Platform
IDC has predicted and illuminated the IT industry's shift to a "3rd Platform" for the next stage in
innovation and growth, which is founded on four technology pillars of cloud, mobile, big data &
analytics, and social technologies. The 3rd Platform will disrupt industry including power utilities. Utility
CIOs will evaluate how to leverage at least one pillar of the 3rd platform better in the coming year. The
areas having greatest potential are big data and analytics, cloud and mobile.
Analytics
In the next 12 to 18 months, utilities will address analytics as it is a well aligned market for analytics.
Transmission operators already use powerful analytics to manage the electric grid called state estimators.
Utilities have a need to make use of data to provide a return on smart grid investments. And they
are looking to analytics to aid in business objectives such as outage mitigation and restoration, theft
and fraud detection, predictive maintenance, among others. In Europe and Australia, retail energy
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providers are looking at analytics to forecast demand and segment customers for new service offerings.
Operational data will be extended, but implementation will be dependent on the development a twoway power and data flow in especially with increasing distributed generation penetration.
Formation in the Cloud
Utilities are already adopting cloud computing. For example, the IDC Vertical Communications and
IT Survey, 2013 found that 23.7% of utility respondents use a private cloud and 18% are using public
cloud. Today, private cloud is preferred over public cloud due to greater security control and assurance
measures taken by utilities. Both public and private clouds are used to reduce hardware and software
costs, reduce outside maintenance costs, and decrease pressure on internal IT resources. The utility
industry is willing to use cloud computing for SaaS（Software as a Service）applications, and, within the
next 18 to 36 months, will start to accept cloud for storage of data. Smaller municipal and government
utilities are expected to move to the cloud sooner.
Services Must Be Secure
One of the biggest barriers to adoption of public cloud is security. That said, cloud adoption will
continue to increase in utilities based on the lower costs of services and speed of deployment. A concern
about security and critical infrastructure protection means that service providers have to prove that the
services they offer are secure and will meet service level requirements (SLAs). For example, customized
utility security SLAs and cloud services made by vendors that offer public responsibility and financial
indemnification for security breaches.
Going Mobile
The use of mobile devices in the field will progress with advances in mobile technology e.g. mobile
broadband networks, high resolution screens, mobile work force management software. Region
dependent, utilities use ruggedized devices in the field. The migration to tablets and smart phone
use continues the transition. One of the most prevalent use of mobility in the field is for recording
inspections and work order completions. The new generation of workers will come to expect their
mobile device to be a means for data collection and GPS tracking, but also to provide critical operations
data to perform the job day to day. Field workers will depend on the mobile phone to support mobile
applications that make their job easier.
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Innovative ICT Empower a Better Connected Smartgrid
Infrastructure Vantage Point
FUTURE
OUTLOOK
Smart grid investments in strategic programs span reliability, security, energy efficiency, and new
revenue initiatives. All are reliant on a robust ICT infrastructure. Projects from around the globe include
distribution automation, smart metering, demand response, electric vehicle charging, small-scale
renewable generation, and dynamic pricing to name a few. The projects are leading to a convergence
of information and operational business processes (IT/OT convergence) and along with it the technology
infrastructure that supports them. It is imperative that the infrastructure remain flexible under change.
Developing a smart grid requires the utility IT & networking teams, and the engineering and operations
groups, collaborate on architecting a communication network infrastructure for the new generation
of assets and devices. The architecture needs to be able to transport and direct accurate, reliable,
and secure data to and from the field, the customer premise, the control center and outside points to
optimize operational systems and support market functions. Both mission critical and non-mission critical
applications also have to be supported. Infrastructure that runs analytics, cloud computing, mobile and
even social media, needs to be scalable and secure for communicating and storing data.
Smart Grid Poster Child
While the Internet of Things (IoT) is proliferating globally, IoT is catching up to the utility industry.
Decades long in use, IoT roots were long growing in the utility industry's use of automation in generation
and transmission networks. Maintaining decades old infrastructure is not uncommon for mature power
utilities but presents an increasingly challenging environment to assure reliability, security and robust
performance. Putting the figures in perspective, according to IDC Energy Insights Worldwide Utility Smart
Grid Spending Forecast 2012 – 2017, total expenditures on ICT spending will exceed $42 billion annually
by 2017.
Network Convergence Enables IT/OT Convergence
A clear path in a smart grid's development follows the effort to automate greater portions of the
power grid from generation through to the consumer premise. The challenges utilities face with respect
to ICT for smart grid are identifiable and include: installing and upgrading communication networks,
managing heterogeneous devices, ensuring system reliability and security, and maintaining the network
infrastructure. A significant challenge, providing the largest benefit when solved, is tight coordination of
the communication network with the power network (grid).
The centralized command and control architectures of power grid design is yielding to distributed
intelligence at the edge of an expanding network of smart devices. Smart devices include line sensors,
smart meters, synchrophasors, transformers, fault interrupters, power control modules, routers, EV
charging stations, renewable generation units, remote terminal units (RTUs), in home controllers and
many more.
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Huawei in Utilities
Huawei Technologies Co. Ltd. is a networking and telecommunications equipment and services company
with headquarters in Shenzhen, China. Huawei is the largest telecommunications equipment provider
in the world with products and services in more than 170 countries and R&D centers throughout
China, Europe, Middle East and North America. The company serves 90% of the world's 50 largest
telecoms operators and more than 160 power utility companies, spanning all five continents. Today,
Huawei's contribution to the power utility industry is established and continues to expand. The
comprehensive approach allows it to meet the varying power utilities needs at global, regional or local
level. The company's innovative solutions deliver value across the key utility businesses of transmission,
transformation, distribution, generation, consumption and IT.
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Innovative ICT Empower a Better Connected Smartgrid
A Converged Network to Interconnect Transmission
Transmission grids require a high degree of coordination with transmission system operators and
interconnections to generation sources that maintain a balanced, synchronized and stable grid. Today,
wide area network (WAN) performance is more demanding than ever. Two interrelated factors are
driving this dynamic. First, utility scale renewable generation such as wind farms and massive solar arrays
are increasingly being developed and tied into the transmission grid. Often, renewable generation sites
are remotely located, for example, off shore or in mountainous terrain in the case of wind, or in desert
land in the case of solar. The intermittent nature of renewable generation will cause voltage drops and
spikes as wind speed and cloud cover affect generation rates often within minutes. Second, wide area
situation awareness (referred to as WASA) gives visibility into adjacent transmission grids that may cause
cascading outages in neighboring utilities. WASA, using highly coordinated synchrophasor technology,
gives a utility or transmission operator an ability to identify a small problem in asynchronous phasing
before it causes a system wide collapse.
The requirements of both renewable generation and WASA demand sub-second responses times that
only a wide area, low latency communication network can provide. As a result, the utility communication
network imperative will harmonize legacy WANs such as TDM based networks with IP networks. The
requirements call for communication network solutions that can build a utility's migration path over a
multi-year period between the generation plants, substations and interconnections among utility entities.
Huawei Transmission and Transformation Communication Solution combines proven TDM network
technology with the low maintenance, flexible and growing all-IP networking in a single solution. This
approach allows for the generational transition to IP networking easing upfront capital costs and risk
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of disruption. With maximum throughput of 8 Tbps per single fiber, data, voice and video can easily
be supported today and in the future. Transmission grid investments in synchrophasors for wide-area
situational awareness can easily be supported even over ultra long distances between high voltage
substation nodes. Additionally, Huawei offers its microwave series products for point to point and point
to multipoint transport and backhaul applications as complement or substitute for fiber where fiber is
cost prohibitive to lay and maintain.
Sensing and Control on the Rise in Distribution
Power equipment and sensing devices with advanced networking connectivity and computing capabilities
is transforming the centralized command and control distribution grid architecture. Today's distribution
communication networking operates well for simple and fast responding SCADA requirements between
substations and the control center. However, the smart grid requires connectivity and advanced analytics
beyond the distribution substation into the field and to the premise. In the field, utilities are investing in
no less than three major efforts.
First, switchgear automation (part of distribution automation) is deployed to maintain reliable electric
service that routes power around faulted sections due to weather related storm damage, and notably
aged equipment that is end of life. Today, switchgear automation is found in 15% or less of distribution
utilities substations and feeders, on average, in Europe and North America, and even less in APAC,
Middle East and LATAM, according to recent research conducted by IDC Energy Insights.
Second, the need to make efficient power delivery for energy conservation and cost savings is leading
to investments in circuit optimization. By correcting suboptimal performance in circuits, the utility can
reduce generation levels and extend equipment life using analytics e.g. Volt/var optimization.
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Innovative ICT Empower a Better Connected Smartgrid
requirements are satisfied through a hybrid xPON and LTE network that brings together the speed of
fiber and the flexibility and low deployment cost of wireless. This approach allows five 9's reliability, sub
100ms latency in network and SCADA operations. Implemented on IPv6 protocol, QoS capabilities can
prioritize and route traffic based on application latency, equipment fault thresholds, or other data traffic
segmentation needs. With rugged equipment and support for utility specific protocols like GOOSE,
substations can be outfitted easily. Additionally, Huawei AMI Solution is a PLC based network built on
OFDM technology and IPv6 protocol, which allows for robust bi-directional data, unrestricted network
configuration, and quality of service (QoS) layering. Huawei's OFDM PLC network supports broadband
speeds at 10 Mbps and features corrective data transmission for network noise inherent to PLC. The
solution supports both PRIME and G3 PLC standards.
Managing the Data, Securing the IT Enterprise
Third, orchestrating demand side management such as Demand Response and customer resources
(e.g. solar, electric vehicles) with grid operations, requires rapid adjustments to grid equipment based
on advanced and cognitive analytics based on real time data. Success will require the utility be able to
plugin any number of disparate devices into a unified field network in the distribution grid.
As legacy SCADA connected devices are brought forward and integrate into the greater, increasingly IP
based, networks found in distribution, the (industrial) Internet of Things (IoT) promises to fuel the big
data and analytics engines with millions and billions of sensing, communicating and control devices.
These device will report and act on an endless array of conditions and measurements. The distribution
grid is a foundation for the IoT as the network's edge expands to the premise meter and connects to
home and building local area networks. In developing a robust distribution grid, reducing complexity
and cost while enabling ease of integration is a foremost objective, while incrementing the network
to support distributed intelligence. To achieve this, utilities will need to consider standards based
broadband wireless networks to ensure devices can reach the performance to enable key initiatives. Such
as distribution automation.
Utilities are faced with the often difficult choice of options in pursuit of enabling networked distribution
devices. In the future, today's passive consumer will become a more active participant in energy
management. While mass adoption is still years away, consumers may become "prosumers" and act
as energy suppliers tying their generation capacity back into the distribution grid. This major trend
effectively forces changes to the central control architecture by creating more distributed intelligence in
the electric grid.
Huawei Distribution Automation Solution is purpose built to meet the burgeoning needs of Distribution
Automation applications such as Volt/var optimization and virtual power plant. The sub-second latency
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Responsible for enterprise infrastructure in the back office, IT is convincingly the valued critical partner
leading security and data management in the business operational systems. Several long arching
trends are bolstering the collaborative efforts that asks IT to play a prominent role in smart grid. First,
smart device proliferation is creating an onslaught of IP addressable devices attached to mission critical
networks. The new cast of devices increases security risks and the surface area for attacks beyond
the closed-network SCADA devices and engineering domain of operations. Second, cyber security is
a new frontier for malicious aggression and utility control systems are the battlefield. Enterprise wide
security must build around a holistic strategy for utility systems safeguarding. At the same time, physical
security of the assets and equipment in the field requires bolstering especially high value, mission
critical substations and feeders. In the U.S. as one example, IDC Energy Insights revealed that 65%
of IT departments hold some or all of utility security budget in a 2012 survey. Unsurprisingly, IT has
deep experience in network security, end point security, identity and access management, maintaining
surveillance and deploying vulnerability services. Third, data is growing exponentially with the utility
operational systems as a result of smart meters, distribution line sensors, smart transformers and dozens
of others devices types. Additionally, consumer facing technologies in and social media is producing
volumes of data mining and analyzing with advanced analytics.
Data center strategies are under consideration and not just for disaster recovery or redundancy. In region,
data centers on premise can be labor intensive. With the data explosion, data center management
services is a quick way to reduce costs to an outsourced arrangement. In other examples, data centers
as a service continue to gain traction for both enterprise and operational data.
By combining the strengths of both traditional data center and cloud computing technologies, Huawei
cloud data centers support this vision of future-proofing, not just with traditional physical equipment,
but with new virtual equipment that relies upon the cloud computing. These cloud data centers provide
a range of elastic services, such as Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and
Software as a Service (SaaS). In addition, they can deliver end-to-end security solutions, as well as unified
Operation & Maintenance (O&M) management platforms. Huawei also offers modular data centers,
which lets customers choose the equipment, features, and services they want pre-installed in the data
centers. The result: quicker, more elastic capacity expansion and a superb customer experience.
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Innovative ICT Empower a Better Connected Smartgrid
CASE STUDIES OF
HUAWEI CUSTOMERS
Zhuhai Electric Power
Zhuhai Electric Power (officially listed as China Southern Power Grid) is a state-owned energy utility that
provides power generation, transmission and distribution services to China's five southern Provinces of
Guangdong, Guangxi, Guizhou, Hainan and Yunnan. The service area covers 1 million square kilometers
and serves 230 million residents. The utility operated 230 GW of generation capacity on 188,000+
kilometers of transmission lines (2014 figure). Strategically, the utility invests for a grid infrastructure
designed and constructed for a large mix of renewable generation and energy efficient assets.
Zhuhai Electric's property portfolio includes generation plants and high voltage transmission network.
These assets are interconnected through its carrier-grade communication network infrastructure and has
achieved high levels of automation in generation and transmission already. By 2011, the utility was then
planning a significant investment in its distribution network to deliver more power, more efficiently using
distribution automation applications and equipment.
In the distribution network, the utility recognized that smart grid operations would depend on
networked, intelligent end points. A smart grid implies vast amounts of operating and measurement
data, a range of application performance requirements and variability in supply/demand curves.
For Zhuhai Electric, the distribution utility is investing in distribution grid equipment, and information
& communication technologies centers on improved system reliability and customer service. Lowering
operations and maintenance costs follow as a priority. As a result, the utility is set out a strategic
investment path to automate 100% of its distribution substations. The plan required a significant capital
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investment of infrastructure build out. For example, distribution substations must connect through a
robust, high performing and reliable communication network otherwise automation is not possible.
Business Problem
Zhuhai Electric had been using optical fiber rings over medium and low signal carrier. As the utility
undertook the expansion of its automated substations, and began planning distribution automation (DA)
on feeders and low voltage line transformers, several limitations were identified with the fiber network.
•
The fiber optic network experiences system downtime events that are typically difficult to identify
and repair. Network visibility capabilities are limited making effective management a challenge to
perform for IT.
•
New road development, building construction, natural disasters and theft are major causes for
outages. Repair of optical circuits that get severed or suffer equipment failure are expensive to repair
as underground communication circuits present challenges.
•
The utility owned fiber optic network infrastructure is costly to operate and maintain despite its high
performance.
•
The fiber optic network is a fixed line, which is not well suited for ease of device deployment,
changing network requirements or rapid recoverability.
The utility determined it needed to explore other communication network technology options to connect
distribution terminals (devices) "in the last 100 meters". The imperative was to reduce capital and O&M
costs, and increase reliability over the fiber optic network. These requirements would become more
important as Zhuhai Electric's device deployments reached into the tens of thousands of sensors and
controllers in the medium and low voltage grid.
The Approach
Planning and technology selection began in 2011 for a wireless broadband solution. Analysis led
to a decision between WiMAX and TD-LTE, which the utility decided to pilot TD-LTE considering
several factors including technical performance, technology adoption, industry standards, and vendor
reputation. Huawei was selected for network hardware and management software, which is a private
network based on Huawei eLTE solution built using TD-LTE standards based wireless broadband system.
The phase1 project included: 1 CN(Core Network), 10 BTS(Base Transceiver Station), 65 CPE(Customer
Premises Equipment). Huawei responsibilities includes network design, system integration network
construction and training services. The utility indentified several benefits including:
•
Maintenance workload has been sharply reduced as power on the line can be verified remotely.
•
Equipment installation is rapid, easy to deploy and simple to install. Management overhead time has
been greatly reduced.
•
Each terminal is IP addressable and real-time condition available at all time, which is not available in
the optical network
•
Future wireless applications will expand to mobile office and mobile operations for field workers.
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Innovative ICT Empower a Better Connected Smartgrid
CHALLENGES
AND
CONSIDERATIONS
Hubei Electricity Company
Hubei Electricity Company (Hubei Electric) was founded in 1993 and is located in Central China's eastern
region. The Hubei province is home to the massive Three Gorges Dam and the largest hydroelectric
plant that is capable of producing an eye popping 22.5 GW of installed capacity. China's investment in
smart grid includes ultra high voltage (UHV) transmission lines. The UHV transmission lines are designed
to overcome the voltage drop that results from electricity travelling long distances, for example,
hydroelectric generation that feeds neighboring provinces.
In China, hydroelectric power utilization is estimated around 30%, which shows a tremendous amount
of capacity that is unused. (Equivalent utilization rates are between 80-90% in European and North
American countries). To operate the UHV lines, Hubei Electric needs to connect the generation plants
with the transmission substations and interconnect substations from other utilities with high capacity
communication network.
Business Problem
In consideration of Huawei product portfolio, utility IT and business unit decision makers encounter a
number of challenges in developing a smart grid ICT infrastructure. The following business challenges
and consideration can be interrelated and share dependencies:
•
Useful life of existing assets. Existing communications infrastructure (and service provider contracts)
weigh into the decision to leverage or replace a previous investment. Legacy communication
network infrastructure such as SONET/SDH or frame relay needs to be rationalized against a new
capital investment.
•
Buy versus build. Utilities prefer ownership of its ICT infrastructure. In the case of communication
networks, utilities prefer ownership of 5:1 over commercial carrier services. Yet, the competitive
costs for public service providers continue to shift lower (i.e. cloud providers, data centers) and the
impact of a faster replacement cycle for digital (and more intelligent) technologies increases, the
business case for buy versus build is becoming less apparent. Utilities need to calculate how the
state of technology will be maintained both in the medium and long term to determine actual costs
and opportunity costs. The risks of communication network infrastructure becoming insufficient for
future applications should be considered to mitigate a technology abandonment risk.
•
Business case. A significant challenge for utilities is assigning the investment costs of a
communication network with multiple projects, applications, and business processes that it
will support. For example, with smart metering projects, the business case often includes the
distribution-area field communication network investment. A general assumption is that investment
leverage can be realized when additional applications like home energy management or distribution
automation run over the same network. However, a common problem is the smart metering
business case can disproportionately shoulder the cost share relative to the benefits conveyed. Or
in other cases, the investment is based on assumptions for future requirements that may never
materialize.
•
Governance. Communication networks for the smart grid require discussions and planning between
operational technology (OT) business units (e.g., transmission, distribution, customer operations, and
information technology) and/or network group (IT). Because the programs, business processes, and
applications will share data and resources, utilities are taking the opportunity to redress governance
issues that may realign internal management responsibilities to best leverage the investment.
For years, Hubei Electric operated an SDH network over its fiber infrastructure. The transport network
limitations prevented the utility from supporting all aspects of its operations including reliable networking
for its transmission and distribution businesses. The SDH was prone to transport disruptions from
weather as well as construction development in the cities throughout the province.
The Approach
To the meet the higher requirements demanded of long distances and high capacity in its transport
network, Hubei Electric deployed Huawei OptiX OSN 8800 and 6800 products. The carrier grade
equipment allows Hubei Electric to process multiple signals including OTN, SONET/SDH, Ethernet and
packets. The hybrid network approach gives the utility the ability to maintain its installed equipment
while upgrading to its next generation optical network (TDM + IP).
Hubei Electric realized several advantages with this approach:
•
•
•
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The OTN network allows legacy TDM equipment continued use, reducing high capital costs at once, and
allows a transition pace as the utility needs.
The ITU-T compliant equipment allows multiple transport paths (five for Hubei), increasing reliability and
overall communication performance levels.
Provided capability for transmission market participation matched to realtime consumption data.
Additionally, allowed the utility to improve capacity for its enterprise networking needs between facilities
and city offices.
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Innovative ICT Empower a Better Connected Smartgrid
ESSENTIAL
GUIDANCE
FOR UTILITIES
Ensure that you have a governance structure that allows IT and the lines of business to work together
closely to identify major business objectives and begin discussions on enabling technologies. Make this
connection at all levels of the organization to ensure the success of technology deployment and at the
highest level (i.e. executive sponsorship) at the earliest stages.
Collect a maximum amount of information as possible about best practices at peer utilities, especially
in developing a communication network strategy. Seek peer utilities that are of similar size and business
mix, for example, the needs and justification for investment of a wires only company will be different
than a vertically integrated, generation or retail only. Some of the most advanced communication
network infrastructures can be found in Australia, China, and North America utilities.
Identify the sources of data available today and establish a realistic roadmap for applying analytics.
Data streams made available in the future will hinge on deployment of not only smart-enabled power
equipment and sensors but also of underlying communications infrastructure that extends from legacy
equipment as well as new data networks that supply real time data.
About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory
services, and events for the information technology, telecommunications and consumer technology
markets. IDC helps IT professionals, business executives, and the investment community make fact-based
decisions on technology purchases and business strategy. More than 1,100 IDC analysts provide global,
regional, and local expertise on technology and industry opportunities and trends in over 110 countries
worldwide. For 50 years, IDC has provided strategic insights to help our clients achieve their key business
objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events
company.
About HUAWEI
Huawei is a leading global ICT solutions provider. Through our dedication to customer-centric innovation
and strong partnerships, we have established end-to-end advantages in telecom networks, devices and
cloud computing. We are committed to creating maximum value for telecom operators, enterprises
and consumers by providing competitive solutions and services. Our products and solutions have been
deployed in over 170 countries and regions, serving more than one third of the world's population.
For more information, please visit http://enterprise.huawei.com.
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