:Chattanooga; :Nov 30, 2009; :Front Page; :1

Smart grid grant catapults city into lead position

Stimulus funding of $111.6 million will allow EPB to speed up roll out of its interactive power system.

By Dave Flessner dflessner@timesfreepress.com

Online: Read previous stories. Comment. For its size, Chattanooga’s electricity provider is getting the strongest jolt from the federal government of any American utility to build a more automated and interactive power system, EPB executives said.

    The $111.6 million awarded to EPB from the federal stimulus plan last month is more than three times as much per capita as the next biggest utility’s per capita grant.

    The U.S. Department of Energy collectively awarded 100 utilities and cities $3.4 billion for smart grids. EPB was the 12th-highest grant overall, but its grant equaled $656 per customer. That’s compared with $216 per customer to Sacramento, Calif., said EPB chief engineer David Wade.

    EPB President Harold DePriest said he hopes the grant begins arriving right away to help speed installation of smart meters with fiber-optic connections to every Chattanooga home and business. The meters help control energy usage and efficiency.

    “This came along at a very fortunate time for us,” Mr. DePriest told EPB directors. “The government asked us to do what we were already planning to do.”

    EPB must match the federal dollars with its own investments but already had sketched out a 10-year plan to build a fiber-optic network
for electric and telecommunications services when the grant was announced in the spring.

    The federal money will allow EPB to build its system in three years instead of 10 and create what officials believe will be the most automated and efficient electric system of any major U.S. city by 2012.

    EPB officials say system benefits include:

    Smart meters in homes will allow more programmable thermostats and controls to be installed to connect with water heaters, furnaces and appliances. Such tools can help direct energy use to the cheapest and best times for the consumer and the utility.

    The utility should be able to cut electricity interruptions and outages by 40 percent or more through early and better detection of problems. Based on U.S. Department of Energy estimates, that could be worth up to $100 million every year.

    Studies by a UTC economist suggest new businesses that come here because of reliable power and fast telecommunications could generate up to 4,700 more jobs for the region.

    “Reliable power is very important for 21st century businesses, and this should help us draw more of them to Chattanooga,” EPB Chairman Joe Ferguson said. “This will have big ramifications for our community.”


    Power users’ benefits are somewhat restricted here because TVA doesn’t yet price its power differently at different times of the day.

    TVA still is negotiating with distributors about ways to revise its pricing system. Most other U.S. electric utilities have some sort of price differentiation based upon their costs to generate or buy power.

    The smart meter technology, developed by Tantalus Systems Corp., will be able to communicate more than 80 billion data points of information per year from each customer. In cooperation with Medium, a local Web design and communications company, EPB is designing a computer program to display relevant data to consumers so they can make choices about when and where they want power.

    Medium, Tantalus, Bell Laboratories and Alltel Lucent all are contributing to the project by halving their normal fees, an extra value of $4 million.

    Jim Ingraham, vice president of strategic studies for EPB, said the company will conduct a smart-meter pilot study on 5,000 homes to see how power demand and supply better can be matched through the day to get a more efficient system.

    “If I can remotely control your hot water heater to tell it to come on at 3 a.m., when there is little demand on the system, that is a heck of a lot cheaper than having it come on at 6 or 7 o’clock in the morning on peak,” he said.

    “Our goal is to find the least obtrusive way of aggregating load on the retail side without interrupting people’s comfort or quality of life.”


    $111.6 million:

Federal stimulus grant awarded to EPB for fiber-optic “smart grid”

    $656: Per capita value to EPB, more than three times as high as the next grant recipient

    1,082: Number of “smart meters” currently installed by EPB

Where the money’s going

    $34.4 million: Laying and connecting fiberoptic connections to 171,000 locations

    $31.6 million:

Network electronics for switching and controlling system

    $26.4 million:

Distribution activities

    $12.5 million: Smart meters installed at each customer’s home or business

    $2.5 million:

Supervisory control and data acquisition upgrade

    $1.08 million: Meter data management

Return on investment

    $850 million of additional economic activity in the community

    4,700 jobs directly or indirectly related to fiberoptic investment

    $50 million estimated value of cutting electricity outages by more than 40 percent

Source: Study by University of Tennessee economist Bento Lobo