McAuliffe, Koreans to Cooperate on Smart Grid

Korea, the land of the smart grid

Hmmm, I wonder what the story behind the story is on this: Governor Terry McAuliffe announced yesterday the signing of a Memorandum of Understanding between the Korea Electric Power Corporation (KEPCO) and the Virginia Economic Development Partnership (VEDP) for “comprehensive cooperation” on the Smart Grid and new energy projects. States the press release:

This MOU allows KEPCO, the largest electric utility company in South Korea, and Virginia to collaborate and promote information sharing, develop strategies, facilitate understanding, identify challenges and stakeholders. The agreement will encourage non-governmental organizations, research institutions, businesses and government institutions at all levels to participate in cooperative activities to support the energy sector. Recognizing their common interests in the industry, both parties will promote mutually-beneficial cooperation on the Smart Grid, technologies and approaches, and other areas of mutual interest.

By way of explanation, McAuliffe said: “Working with an international company like KEPCO to share and promote best energy practices will help us develop a strong partnership and will open the door to future investments in Virginia.”

Bacon’s bottom line: It is good for McAuliffe and Virginia to think about the future of the electric grid. The so-called “smart grid” — using information technology to promote energy conservation and renewables — is advancing by leaps and bounds. KEPCO has spent nearly $250 billion developing and testing its own smart grid technology, so Virginia undoubtedly has much to learn — and possibly technology to adopt.

I can’t help but wonder, though, if this is the economic development equivalent of vaporware. Will McAuliffe, who has only one year remaining in office, have time to build institutional relationships that can accomplish anything meaningful? Or does he think that KEPCO actually might invest in Virginia?

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7 responses to “McAuliffe, Koreans to Cooperate on Smart Grid”

  1. I’ll vote for “vaporware.”

    Few in the industry even agree on what the “Smart Grid” means. It’s a suggestive but meaningless phrase. Are we talking about the grid itself: how it responds daily and adjusts long term to changing loads and changing sources of generation? Are we talking about how retail customers (especially residential customers) use electricity, i.e., adjust electricity consumption by energy savings, by the use of batteries and other self-supply options, and by the timing of significant uses in response to price and demand signals from the grid? Are we talking about commercial/industrial customers interface with the grid, i.e., participate in curtailable load/load management programs and self-generation to lower peak demands? Are we talking about how independent generators build new generation in response to changing consumption patterns and wholesale market price signals? Are we talking about Big Data’s influence on utility and grid system operator planning for the ‘grid of the future’? I can go on; the flexible use, misuse and abuse of the term “smart grid” is endless.

    Now, once you’ve peeled away that layer of press-release vapor-speak, what’s underneath? A large Korean technology company wants to “cooperate” with a U.S. State government or agencies thereof in order to “encourage non-governmental organizations, research institutions, businesses and government institutions at all levels to participate in cooperative activities to support the energy sector.” Research, business and government institutions? NGOs? This sounds like something to do with developing commercial energy conservation and load management technology, with maybe a little on-site renewables generation thrown in, aimed primarily at the institutional customer with multiple buildings, a large campus under one owner, and a sophisticated energy manager on the premises. Hey, we need Korean involvement to accomplish this? The Koreans have insights or technology that we don’t have, probably gave to them in the first place? I bet there are some U.S. load-management-technology companies just delighted to have this State-sponsored competition. And Dominion must be just delighted to have all this utility, energy-related activity right in its own backyard that it has no involvement in.

    And yes, Kepco might conceivably “invest in Virginia” but at what net benefit to the State, after deducting the cost in terms of data mining and government favoritism for what is, in fact, a private company engaged in a business in direct competition with U.S. businesses doing and selling exactly the same things to help consumers take advantage of the “Smart Grid.” Again, whatever that means to you. Or to Kepco.

    1. Reed Fawell 3rd Avatar
      Reed Fawell 3rd

      Most likely this is Virginia’s Governor hard at work setting up networks, business models, lucrative business connections and worldwide activities that will be in place to jump start his future fortunes made as a retired Governor then in private businesses doing private/public partnerships,” Big Crony Business Deals, after he steps down as Governor of Virginia. All legal of course.

  2. Tom Christoffel Avatar
    Tom Christoffel

    Virginia could do much worse. South Korea has 85.7% share of its population as Internet users in 2016. It tried the Japanese connection with Canon in the 1980s, Saturday School and all that, but did not seem to bring the expected results. Institutional connections should grow where there is true value. As efficiency is becoming the new growth, relationships with another highly efficient conservative culture can’t hurt.

  3. LarrytheG Avatar

    I’m sorta with Acbar on this – but just point out that McAuliffe’s self-serving PR releases don’t sound much different than the ones Dominion with BR’s “help” puts out these days!

    oh vey!

    bite my tongue!

    And what’s the difference between McAuliffe/Korean crony capitalism ED and Dominions… ???

    Oh the horror! McAuliffe is inviting a Korean company to come in and do what Dominion has steadfastly refused to do on the demand side?

    “vaporware” or vapor lock?

    1. “And what’s the difference between McAuliffe/Korean crony capitalism ED and Dominions… ???”

      I was tracking with you until you brought Erectile Dysfunction into your argument.

      1. LarrytheG Avatar

        oh… you don’t think Dominion is ALSO an accomplished purveyor of crony capitalism?

      2. [Still chuckling over ED]

        You point out, “McAuliffe is inviting a Korean company to come in and do what Dominion has steadfastly refused to do on the demand side?” That really is the key question here, and it’s a question, not a diagnosis. IF Kepco is going to bring to Virginia its wealth of knowledge of how institutional customers can take better advantage of energy efficiencies and load management and self generation in order to cut their fuel costs and lower their environmental impact too, then hooray, bring ’em on, because Dominion has been slow to ramp up that sort of “customer service” and there’s potentially a large market for it in Virginia. But IF Kepco is going to bring a token presence to Virginia in exchange for gaining all sorts of commercially-valuable experience and data about how the PJM wholesale markets and Dominion’s multiple generation and retail businesses work together just so Kepco can expand its business presence in the rest of the US and other parts of the world, we can remain skeptical of this “cooperative venture.” What’s really going on is probably a little of both; let’s hope the Governor isn’t just being naive.

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