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Figure 1.22 SG role in the electricity power sector.

      Indirect benefits of the SG include the reduction of the overall expenses by reducing both long‐term capital expense and operating expense. As demand increases, utilities must provide the required power to meet the peak loads which results in extremely high‐cost infrastructure. Smart management of energy supply and demand will help reduce the need to build more power plants in addition avoiding oversize of transmission and distribution infrastructures which, in turn, decreases the long‐term capital cost. In addition, SG adaptation enables the utility to reduce power outages, decrease the risk of premature failure and, in turn, increase resiliency of the overall grid. Furthermore, new economic growth and job creation are important indirect benefits of the SG.

1.12 Smart Grid Challenges

      The power system is migrating from the conventional grid to the SG which faces many obstacles and challenges. With all‐new energy resources, smart devices, and entities, the complexity of the system will significantly increase. Optimal design, operation and handling of such systems will become more challenging, even with the availability of new technologies and tools. Chapter 18 identifies the most important challenges facing the development of the SG. Here we briefly touch upon specific points as the main challenges facing the transformation to the SG energy paradigm.

      1.12.1 Accessibility and Acceptability

      Customers' acceptability, privacy, costs, cybersecurity, and regulatory considerations possess a substantial influence on the advancement of SGs. Undeniably, customers play a vital part in SG expansion: they are needed to transform their part as customers from passive to active, having full knowledge of their consumption, and capable of managing it depending on the availability of energy which is considered a challenge [76]. The SG technology should be accessed, accepted, and adopted by various grid operators and end‐users. Success of this transformation depends on all levels of acceptance, without exception.

      1.12.2 Accountability

Accountability is essential to enhance the security of the SG including privacy, integrity, and confidentiality. Accountability refers to a system that is recordable and traceable, consequently, including various parties responsible for those communication principles for its actions. Accountability logic is considered as an essential process to examine the accountability of a secure system [77]. All grid players hold responsibility for its success and utilization, but also include various levels of accountability. This should be identified and made clear to all grid players.

      1.12.3 Controllability

      SG technologies contain a large number of different controllable elements, systems, and subsystems which require coordination and proper management. As an example, DERs are connected to the grid directly or through a power electronic interface. The voltage source inverter (VSI) is connected to the grid as an interface to support the suitable modification of the grid voltage and frequency [61]. The entire grid is becoming more power electronics dominated with very low inertia. Controllability of such a system becomes a major challenge for stable and efficient operators.

      1.12.4 Interoperability

      The IEEE definition for interoperability is “the ability of two or more systems or components to exchange information and to use the information that has been exchanged” [78]. The SG is an interoperable system that should be capable of exchanging meaningful, actionable information, addressing safe, secure, efficient, and reliable operations of power systems. The systems will distribute a pre‐defined purpose of the exchanged information, and this information can expect suitable types of responses. The reliability, fidelity, and security of information exchanges among SG subsystems and components should achieve required performance levels [79]. The GWAC (Grid Wise Architecture Council) [80] has looked at, interoperability between components of the same system, or between different systems and suggests several implications to be derived;

      In the context of the SG, interoperability includes seamless, end‐to‐end connectivity of hardware and software from end‐use devices to the power source, improving the coordination of energy flows with real‐time information and analysis. Interoperability is an essential part of the success of SGs. According to the National Institute of Standards and Technology (NIST) [81] “Once appropriate levels of interoperability are achieved, policymakers, investors, engineers, and other stakeholders can turn their attention to solving a broad set of challenges: improving the efficiency of power delivery, transitioning to cleaner energy sources, and enabling new markets that surround electricity delivery.” The NIST‐coordinated interoperability effort is organized to include a wide set of stakeholders among the industry, and it is examining the purpose of standards across a wide range of SG interoperability areas [79].

      1.12.5 Interchangeability

      Interchangeability defines the process of two or more components interchanged by joint replacement without affecting system performance [82]. Interchangeability needs devices to aid in the present functional behavior on their communication interfaces

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