Clean Energy 101: The Changing Electricity Grid

This is part I in a series of basic grid explainers. See part II, “How Rising Demand Is Driving a Grid Tech Revolution.”

Electricity powers nearly every aspect of modern life, from brewing morning coffee to running factories and hospitals. But as electricity demand grows, grid equipment ages, and extreme weather becomes more common, every part of the grid — its processes, infrastructure, and how we manage it — need to evolve to ensure that electricity is still available and affordable when people need it.

Thankfully, the United States and other regions with mature grids have the technology and know-how to transform a system first built in the 19th century into one better suited to 21st-century energy needs.

How the basic grid works

The electricity system is all around us, all the time. From outlets in our homes to wires overhead, its physical parts are so familiar we barely notice them.

Yet those familiar components are part of a continent-spanning network that links power plants, transmission lines, substations, and customers into a single system. Some have called it the world’s largest machine.

In a traditional, centralized system like those of the United States, Europe, and much of the developed world, every electron goes on a meandering journey before it gets to the outlets of our homes and businesses. It starts with generation:

This basic architecture has been the default worldwide since 1882, when Thomas Edison wired up the first buildings to a nearby generator at Lower Manhattan’s Pearl Street Station. In the United States, new plants, transmission lines, and related infrastructure spread rapidly, with investment peaking after World War II. But starting in the 1970s, electricity demand in the United States leveled off, with little need for new power plants, and scant investment in the grid.

This stability made it easy to plan the electricity supply to match users’ demand. Because of the substantial costs involved in planning, building, connecting, maintaining, and fueling big power plants, a centralized system made sense. It was most cost-effective to build one big generator and distribute electricity outward, rather than to build multiple smaller power plants that all needed maintenance and fuel.

As long as supply and demand were consistent, fuel was plentiful, and the electricity delivery system was operable, this centralized system has been dependable. However, in recent years, surging demand, volatile fuel prices, and extreme weather have threatened the integrity of US transmission and distribution infrastructure.

A more flexible electricity system that can adapt to changing variables is needed to support electricity reliability moving forward.

Making the grid less centralized

Cheaper, more flexible alternatives to this centralized grid model are emerging in the United States and beyond. As costs fall for solar panels, electricity storage technologies, and other clean technologies, distributed energy resources (DERs) are becoming more accessible.

DERs represent an evolutionary shift from the grid’s original design, when power was mostly centralized in one big power plant supplying many users, to a new era in which smaller sources of power are distributed among many users. Some of them may not even be connected to the power line network.

For example, today, folks can pop a solar panel on their roof or in their backyard, whether they’re in Cairo, Ill. or Cairo, Egypt, and start generating low-cost power in mere minutes. Plus, with affordable battery storage widely available, they can access clean electricity even when the sun doesn’t shine.

Businesses have also seen the benefits of incorporating DERs. They can help prevent product loss during outages, stabilize electricity costs during periods of volatility, and be leveraged as a resource to sell electricity back to the grid.

Adding DERs to the grid creates more flexibility and resilience across the whole system — just as in an investment portfolio, diversification is key for stability — so getting new DERs connected quickly and including them in grid planning and management has benefits for all.

To learn more about how this shift from centralized to distributed will take shape, continue on in Part II.