SMART Grids: A Technology for Society

A short Introduction

Scientific Essay, 2014

10 Pages, Grade: 1.33



The following paper presents the ‘Smart-Grid VDAR’ technology presented at CeBIT, Hannover. The idea and structure of the technology is subsequently introduced followed by a social analysis of the technology. Some of the relevant groups identified were: consumers, producers, environmentalists and the government. High installation costs and health concerns were addressed as the main problems concerned with the use of technology. Finally, the aim of European Union to adopt a smart grid within the next decade is highlighted which is an indication of an overall positive outlook towards the technology.

Keywords: Smart-Grids, European Union, SCOT Analysis, Energy Market


The governments of most countries started liberalizing their energy markets in the early 90’s. This deregulated energy market gave customers the choice of selecting electricity providers according to their needs and prices. However, a fierce competition emerged amongst the providers to generate, transmit and distribute power.1 Ignoring the characteristics and the scale of deregulation in different countries, two common patterns have been observed: 1) It is difficult to store energy and deliver on demand. 2) Demand is price insensitive. This means that the power demand remains the same or continues to go up even if the electricity prices increase largely.2

The two occurrences caused unreliability of power when providers and distributors were faced with a sudden increase in demand which ultimately meant high prices for customers.3 To cope, many utility industries installed sensors and factories to analyse real-time energy consumption which enabled them to predict power demands up-to a certain point. As sensors became cheaper and wireless communication more widespread, the companies began avoiding power failures and overheating of power-lines through quickly rerouting electricity.4 This is considered a ‘smart-grid’ whereby intelligent power supply networks permit efficient and reliable use of energy.

The following paper reports on the ‘VDAR technology’ which is an extension of basic ‘smartgrids’ on a national and international level. The information regarding the technology was encountered on a field trip to CeBIT, Hannover.5 This paper analyses the technology by answering the following questions: -

1) What are Smart-Grids in VDAR IT Project?
2) What is the social construction of Smart-Grids?
3) What is the future of Smart-Grids?

A thorough literature review is the basis of this report where papers written by presenters of the technology in Hannover, Germany remain the main focus.

What are Smart-Grids in VDAR IT Project?

The current power market is mainly an economic system which reflects the power flow in terms of trade for the day ahead and real time auctions. The VDAR IT Project proposes a ‘smart-grid’ ready power market which integrates the physical reality of the power market into the economic reality of the market model. This new grid is envisaged to contain a virtual grid based on bidirectional communication processes including novel components such as storage and distributed energy resources6. (see Figure 1)

illustration not visible in this excerpt

The physical grid, the virtual grid and the economic market are interconnected by a decoupled control loop. In this ‘smart-power-grid’, consumption control is not about energy saving but about efficiently balancing supply and demand, ideally in real time, to prevent extreme load situations both in the market and the grid. For example, in Germany, this technology could be incorporated in a top-down approach in various states and region and equally to cities, offices and home. A sudden demand leading to high local load and extreme prices can be compensated by borrowing and transferring power from other regions. Thus, in future smart cities, where anyone can be both a consumer and a producer, everyone can potentially contribute to the alleviation of price insensitive high demand across the network.

What is the Social Construction of Smart-Grids?

The Social Construction of Technology states that it is the human needs and actions which shape technologies and not vice-versa.7 The SCOT (Social Construction of Technology) theory has 3 core principles namely: ‘ Interpretative Flexibility ’, which consists of how people perceive a technology, ‘ Relevant social groups ’, people associated with the technology and finally, ‘ Problems and Conflicts ’ , which can arise. Smart-Grids are analysed on all three basis and it is hypothesized that the technology would have wide ranging influences on many social groups. The structure of the current power market is a good place to identify said social groups. (see Figure 2)


1 Cf. (Arentsen & Kfinneke, 1996)

2 Cf. (Ding et al., 2013)

3 Cf. (Wang et al., 2011)

4 Cf. (Scientific American, 2011)

5 CeBIT is the world's largest and most international computer expo. The trade fair is held each year on the Hannover fairground, the world's largest fairground, in Hanover, Lower Saxony, Germany, and is considered a barometer of the state of the art in information technology. It is organized by Deutsche Messe AG. The passes to the fair were generously provided by Volkswagen AG.

6 Cf. (TECO, Karlsruhe Institute of Technology, 2012)

7 Cf. (Bijker et al., 1993)

Excerpt out of 10 pages


SMART Grids: A Technology for Society
A short Introduction
Jacobs University Bremen gGmbH
USC: Society and Technology
Catalog Number
ISBN (eBook)
ISBN (Book)
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732 KB
smart, grid, smart grid, europe, netherlands, germany, united kingdom, ceBIT, wind power, solar power, electricity, vdar, technology, analysis, report, future, outlook, benefits
Quote paper
Suryansh Pant (Author), 2014, SMART Grids: A Technology for Society, Munich, GRIN Verlag,


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