5 Reasons Why Developing Countries Need Smart Grids, Too

While much of the attention in the smart grid industry has been focused on the U.S. market — gotta take advantage of that close to $4 billion in smart grid stimulus funds — developing countries like India, China and Brazil are also looking to make their power grids smarter. For these countries, some of which are experiencing rapid economic growth (translates to more homes and buildings getting connected to the grid) there are some similar, and some very different, reasons to make the grid smarter compared to the developed world.

China is predicted to be one of the hottest smart grid markets in the coming years given its energy needs are expected to double in 10 years, and the country’s dominant power distribution company, State Grid Corp., has a goal of building out a smart grid by 2020. India might not have the same momentum, or government funds in the pipeline as China, but Indian utilities are still looking at pilot projects and the Bangalore Electricity Supply Company (BESCOM) is working on a smart grid pilot project. According to research from the Bangalore-based nonprofit Center for Study of Science, Technology and Policy (CSTEP), these are five reasons why developing countries need, and want, smart grids.

Stopping Power Theft: Not such a problem in developed countries, but in India with little oversight of the grid and higher poverty rates, power theft is quite common. Rahul Tongia writes in his white paper for CSTEP that just basic grid accounting — knowing where the power is flowing when — will be a “strong driver” to cut down theft. (Theft of diesel to power off-grid cell phone stations in rural areas of developing countries is quite common, too, see GigaOM Pro’s How Mobile Networks Can Cut Carbon, subscription required).

Higher Quality/Reliability of Power, Fewer Blackouts: If homes in developing countries are connected to the grid, often times the connection is poor, and users can only access electricity during certain times of the day. Grid load balancing and distribution automation services,can help keep power flowing more continuously and alert utilities to blackouts (see New Opportunities In the Smart Grid, GigaOM Pro). Utilities in the U.S. are also making grids smarter to be able to react much more quickly to blackouts.

Leapfrog to Smart Grid: In many developing countries, power grids have not been fully built out — in Tanzania 80 percent of the population lives within 5 kilometers of a transmission line but only 10 percent has access to electricity. But smart grid technology can “represent an opportunity for developing countries to leapfrog in the growth of their power sector to more manageable, reliable, and scalable designs,” writes Tongia. Basically skip the older systems, and start with the newer IT-based ones. Many have speculated that developing countries could do the same thing with renewable power.

Growth Justifies the Cost: Some developing nations like China, which will double its energy needs in a decade, are growing at such a rapid pace that the addition of smart grid technologies can be justified to utilities by the growth of power consumers. The hardest part for utilities in the U.S. is making the economics of smart grids work, but in China the addition of many new customers can help with the return on investment.

Renewable Power Needs Smart Grid: If developing countries are more successful in adding distributed clean power than developed countries, utilities will need a smart grid to manage problems caused by intermittency (the sun and wind only happen during certain times of the day) and distributed power. Tongia writes that distributed clean power will “fundamentally change the design of the grid, beyond any policy or regulatory changes distributed end-user generation entails.”

Related research on GigaOM Pro, subscription required: New Opportunities in the Smart Grid

Image courtesy of gever tulley’s photostream Flickr Creative Commons.


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