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Social Innovation

What is a smart grid?

Here we bring new energy technology back to basics and tell the story of how a smart grid works through a simple analogy

Just what is a ‘smart grid’?

And what are the benefits of a smart meter?

So many new technologies these days are called ‘smart’ but what does it actually mean? To answer these questions, we found that it helps to think of energy as food.

You set up a recurring food order with your local shop and they deliver the same order to you every week. However, over the years, your needs change; your children move out and you start growing your own food. This means that the shop is now delivering way too much food which you don’t eat. Not only does it go to waste but it’s costing you extra money that you don’t need to spend.

The way to solve this problem is to buy a phone and call the shop to let them know the amount of food you actually need. You save money and the shop can sell the extra food to someone else. Everyone wins.

The shop decides to connect to other shops in the region using a phone, meaning they can work together on the amount of food they are selling and where best to sell it. If a shop in one village knows there is a wedding at the weekend and they’ll need to stock up on additional supplies, it can call up another shop in the area and ask if it would be possible to buy some of their food to feed the extra guests.

After a while, the shop then begins to buy local food from the nearby farm and is able to sell that to you as well. You’re happy to support your local community, and it doesn’t cost you any more than before. A network has been created between you, the shop and the nearby farm. It benefits everyone because everyone is receiving the exact amount of food they need and the food that was previously wasted is being sold to other people.

Replace food with electricity and this is how a smart grid works. Your phone represents a smart meter, communicating your energy needs directly to your energy utility supplier, which is the shop. Smart meters allow the energy supplier to communicate with all of its customers, and based on that data, it can work out where best to transfer electricity in order to minimise waste. It can even sell leftover electricity to others who need it.

The farm represents the energy source, be it renewable, nuclear or gas. This smart energy system means that when there is a bumper crop because of an excellent summer of sunshine or a windy autumn, this extra energy can be saved and distributed to people who need it.

Installing a smart meter in your home gives you the right amount of energy you want, when you need it and at the best price. And, sticking with the food analogy, there is no risk of you going hungry.