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Superconductors Play Vital Role in the Smart Grid

This article is based in part on research from Markets for S mart Grid Cable s and Insulators: 2010.

Superconductors and their Role in the Smart Grid

High-temperature superconductor (HTS) cables can carry an order of

1  magnitude greater power than traditional cabling and conduct
electricity at near zero resistance. Smart Grid Analysis believes there is
consid erable potentia l for this new type of cabling to be deployed in
the power grid to increase grid capacity, integrate renewable energy,
and enhance reliability and security, all key requirements of the Smart
Grid vision.

Despite this potentia l, the future of superconductors in the grid is

uncertain and will depend on several factors, most importantly the
continuation of subsid ies and technical improvements in the
superconductors themselv es.

More Capacity Through Superconducting

The huge increase in carrying capacity that superconductors can

provid e to the power companies is well illustrated by a project in New
Orleans, where HTS cable is being used to address power supply
constraints affecting the Metairie area—a densely built residentia l
neighborhood. As la rger homes rapid ly replace old er, smaller ones in
this neighborhood, power demand is increasing and stretching existing
distrib ution capacity to its limit.

The conventional solution here would be for the utility to bring in a 230
kV line and build a complete new substation, involv ing significant
investment and time. Instead, 13.8 kilov olt superconducting cable will
connect two existing substation sites in greater New Orleans creating a
“virtual substation.” This is the kind of situation that many power
companies will face in the next decade and we therefore believe that
it will create a major opportunity for superconducting cable in the
future.

Smart Grid Analysis believes that this opportunity is enhanced by the

fact that in many areas where new facilities might have to be built,
there is little room to do so. In the Resilient Electric Grid (REG) program,
also known as Project Hydra, the high power density of
superconductors allows them to fit in available underground real
estate in the dense urban area of Manhattan.

Greater Reliability through Superconductor Interconnection

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The high capacity of superconducting cables also suggests that they

can usefully serve as “trunking” for interconnecting substations and
formerly separate grids. We believe that demand for this enhanced
architecture is likely to emerge from the power companies for at least
two reasons: (1) it makes the grid more resilient and facilitates load
sharing, because power can be transferred between regions and
locations when outages occur; and (2) it allows large amounts of
intermittent power generated by renewable energy sources
(especia lly wind) to be transferred between regions. Power
generated by wind turbines can now be used in urban areas.
2 
With regard to (1), we note that ConEd expects Project Hydra to
improve reliability by allowing the utility to re-route load from one part
of the grid to another in an emergency. This obviously speaks to
important needs in a world in which major outages in large cities
throughout the world have been on the increase and threats to the
grid from terrorists and hackers have become a significant concern of
gov ernment.

Superconductors can also address the reliability and security issue

through superconductor-based fault current limiters (FCLs). When FCLs
sense a fault current, they prevent a la rge increase in the electrical
flow, choking off a potentia lly damaging electrical spike (thereby
preventing cascading failures) while allowing normal current to pass
through unimpeded. Several companies have already built and
deliv ered superconducting FCLs; they are used in Project Hydra, for
example.

Connecting Renewables

The examples giv en above—rela ting to the need for more capacity,
reliability and security—are all clearly based on familiar issues that
power companies face already and will face increasingly in the future.
As such, the size of the opportunity for superconductors depends on
relativ ely easy-to-calculate benefits and costs. However, when it
comes to opportunity (2)—using superconductors to effectiv ely make
use of intermittent power generation—there are far more unknowns.

Nonetheless, integrating renewables into the grid is one of the prime

objectiv es of the Smart Grid and how it can be done is well illustrated
by the Tres Amigas project, where superconducting cables link the
three major grids in the U.S. and enable gigawatts of renewable
energy to be transmitted over large distances. The Tres Amigas
project is taking place in Clovis, New Mexico, a location that has easy
access to the three grids. It is probable that more than four power
companies will be involv ed in this project by the time it goes
operational at the end of 2014.

Smart Grid Analysis | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-270-7017
 www.smartgridanal ysis.com

To understand the commercia l importance of this kind of project,

consid er the cancella tion of T. Boone Pickens’ massiv e wind farm
pla nned for the Texas panhandle. Lack of sufficient transmission
capacity was cited as one of the factors that contributed to the
cancella tion. Could a renewable energy hub such as that proposed
at Tres Amigas be the answer to this type of problem facing wind
power?

The truth is no one really knows. For one thing, the jury is still out on just
how the Smart Grid needs to be architected to make the most
3  effectiv e use of renewables. (We note that the telecommunications
industry has been changing its mind on exactly this kind of issue for
more than a century now!)

And perhaps even more importantly, no one really knows what the
real costs and benefits of this type of Smart Grid architecture would
be. The dream is of wind power being generated in vast quantities in
Texas and Kansas and sola r thermal power being generated in en
masse in Nevada and then shipped cost effectiv ely to the East Coast
(or beyond). The nightmare is that wind power (in particula r) will never
make much economic sense without Smart Grid facilities that
everyone—the power companies, the wind generation industry and
gov ernment—is reluctant to pay for.

Costs, Policy and Technology

Indeed, the cost issue facing superconducting cables in the Smart

Grid is—for the time being—bigger than just the problems associa ted
with renewables. The superconducting cable firms with which we
have talked have stressed that government subsidies are essentia l to
the immediate revenue prospects for their type of cabling. This
creates uncertainties; for how long will government subsid ies for
superconducting grid projects continue?

Again this is a big unknown. The likelihood is, however, that where
national security is perceiv ed to be at stake, government will continue
to cough up the funds. We note here that the U.S. Department of
Homeland Security has funded Project Hydra. Secondly, government
subsid ies for renewable energy seem to be well established in many
important markets and this policy priority would seem likely to continue
to fund superconducting “renewable energy hubs” such as the Tres
Amigas project. However, taxpayers’ patience, unlike the power of
the wind and sun, is not inexhaustib le when it comes to renewables
and we note that the generous subsid y programs for renewables in
Germany are now under political pressure.

Government subsid ies for superconductor projects that address

everyday issues faced by the power companies, such as higher
capacity demand and network reliability, are even less likely to surviv e

Smart Grid Analysis | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-270-7017
 www.smartgridanal ysis.com

in the long run. They can be sold as job programs for just so long
before looking more like corporate welfare.

This means that in a year or two or three, power companies will have
to come up with ways to make real business cases for the deployment
of superconducting technology in their Smart Grid s. And this will
require considerable improvement in the cost of superconducting
cable.

Superconductor cables are much more expensiv e than conventional

4  cabling materials—orders of magnitude. Smart Grid Analysis believes
that there are at least three ways that this can change: lower-cost
manufacturing methods and materia ls pla tforms for mass production
of superconducting wires; improved cable making; and improvements
in field repair, maintenance and remote diagnostics for
superconducting cables and wires.

Superconducting wires are already in their second generation of

materials and several companies are working on improved cabling as
well. Finally, the impact of significant productiv ity gains in field repair
and maintenance for superconducting cables should not be
underemphasized. It was precisely these gains that helped to
spearhead the deployment of fiber optics in the telecom network;
and in many ways this is a very simila r situation to what we face with
superconductors in the telecom network.

We are hopeful in all these areas. As a result, we expect the market

for superconductor products used in the power grid to grow to more
than $175 million by 2017.

For additional information on this and other reports from Smart Grid
Analysis, please visit us on the web at www.smartgridanalysis.com

Smart Grid Analysis | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-270-7017