ROADMAPS Israel’s case for smart grid deployment Briefly put: The Israeli Smart Energy Association (ISEA) has recently released the first comprehensive study and recommendations for a Road Map for Smart Grid Deployment in Israel. The report provides an outlook on the technologies, trends, regulations, marketing aspects and the uniquely developed Cost Benefit Analysis (CBA) model. The Israeli Smart Energy Association (ISEA) took upon itself to prepare a comprehensive document analysing all aspects of Smart Grid deployment: Global trends, technology, engineering, regulation, legal aspects, marketing aspects, economic viability, and the role of the local industry in deployment. The report analysed the Smart Grid in an objective manner from the point of view of the national economy. Israel is an “interesting case”. On the one hand the Israel Electric Company (IEC) has installed advanced control and supervision systems in the transmission and distribution segments. On the other hand Israel is lagging behind in all elements related to end user premises. 1. The grid itself, including sensors, connectivity, communication, security, privacy, real time, data sharing, interfaces, visualisation and operation. 2. End customers and small scale generation facilities. It was noted that the integration of all these components presents numerous challenges including: Implementation, Integration, Cost, Standardisation, an Open platform, Acceptance (operators and customers). Each of these was then analysed in detail. offers a paradigm shift for a new model of consumer communications – a model that moves from providing information only, to providing education and then to engagement. In this new paradigm energy customers have a significant role to play in the new service delivery ecosystem. If customers do not engage with the new tools and reduce energy use, the business case for smart grid is dissolved. To overcome this potential obstacle Israel has to implement the best practices that have helped utilities around the globe gather success: Understand stakeholder engagement internally: Use customer advocacy groups and strategic collaboration initiatives. Educate in phases: Breaking down the elements of information and planning communications in phases as the deployment phases evolve. It is clear that the smart grid is a fact. The question is not IF but WHEN and HOW. The first trial is currently under way, and is scheduled to be completed during the first quarter of 2014. The report analysed the experience gained to date in more than 10 countries in order to understand the key success factors and shortcomings in the different ways of deploying the smart grid concept. The main insights for the Israeli market were determined as: The end user as a stakeholder: In a smart grid environment, customers play a critical role in energy reduction, as they become more proactive in energy management. This calls for engagement between the utility and customers. Given the current situation in Israel where the end user is mainly passive in their energy management, it was recognised that the smart grid Understand the customer: Market research plays a critical role in communications program design. Test the messaging: Testing on different customer segments will result in a more targeted and effective communications plan. People are different. Segments are different. Regions are different. Monitor: Track response, prepare to alter the plan and foresee contingencies. The importance of a trial: Most countries performed technical and marketing trials before deploying the system. Determine an adequate incentive to implement the smart grid technology: Common to all countries is the gap between the time the smart grid will show the real benefit and the period of investment. This phenomenon is called a “CAPEX time-shift problem”. The key factor for success is introducing the right pricing that will motivate the end user to cooperate and save electricity. The report also included a detailed analysis of the various technologies currently available and their applicability to the Israeli market, addressing two main segments of the Smart Grid: 46 Figure 1: Net Present Value (NPV) 2015 - 2030 given discount rate of 7% METERING INTERNATIONAL ISSUE - 1 | 2014