In several of our operating companies, we are integrating a host of advanced grid technologies into the existing electric network that can improve service quality and reliability, lower energy consumption, and offer additional customer benefits. The new technologies, which are mostly being integrated through our gridSMART® initiatives, can help us improve our efficiency, identify and respond to outages more quickly, and better monitor and control the operation of the distribution system.
The gridSMART® initiative provides the advanced grid infrastructure needed to realize the many potential benefits of the smart grid. These technologies make the grid more efficient and empower our customers to use energy more efficiently. AEP is deploying smart grid technologies in several states, where we have regulatory support. gridSMART® also provides customers with new and innovative programs and pricing options that allow them to monitor and control their own energy use, saving resources and money.
Applying technology on our distribution system through monitoring and controlling voltage reduces the amount of energy that must be produced and delivered to customers on demand. Known as Volt VAR Optimization (VVO), this proven technology has energy efficiency benefits as well. Typically, customers receive electricity at a voltage between 114 and 126 volts. Studies and our recent experience show that optimizing voltage – delivering voltages that more closely match the voltage level customers’ equipment was designed for - allows customers to receive the electricity they need while reducing their demand from the grid and lowering their consumption. This contributes to energy efficiency at the customer’s location and makes for more efficient use of the distribution system.
We started deployment of VVO at AEP Ohio as part of the gridSMART® Demonstration Project and we have since expanded it to Indiana Michigan Power, Kentucky Power and Public Service Company of Oklahoma. Early results indicate reductions in energy consumption by customers averaging three percent are achievable with this technology in operation.
We have asked for additional regulatory approval to use this technology to meet energy efficiency targets. I&M Indiana has 50 proposed and plans to seek regulatory approval for additional circuits. I&M Michigan has three proposed VVO circuits. AEP Ohio is working with the Public Utilities Commission of Ohio to include 60 circuits of VVO in its gridSMART® Phase II plan, and Appalachian Power Company is planning to deploy three circuits in West Virginia to demonstrate the energy efficiency benefits. Our Distribution planning team is evaluating all of the circuits in each of our operating companies to determine costs and benefits.