System modeling for the large-scale diffusion of multiple electricity technologies in an urban distribution network

The popular concept of a “Smart Grid” involves an integration of novel information and communications technologies across an evolving electricity system spanning generation, transmission, distribution and customer networks. For example, distributed generation, energy efficiency, and demand-side management will enable and affect many changes in the electric grid. Drivers for an advanced grid include stresses on the existing system, the attractiveness of new capabilities enabled by technology, and the influence of economic, environmental and security concerns. The rate and form with which these technologies will diffuse are open questions. While there already exists a large body of research which considers the technical potential and local impact of specific “smart” changes to the grid, holistic studies are also needed to assess some of the complex and interrelated effects of adoption across this vast technology set. As part of a larger initiative, a system dynamics model was developed emphasizing the electrical distribution system in an urban context. The model allows for simulation of a wide range of scenarios in order to analyze the diffusion and impact of compound technological changes on the electrical distribution system. For the purposes of this paper we evaluated subsidization policies for select novel technologies and services. This allowed for the identification of a subset of subsidization targets that in our simulation were more effective than others at accelerating the development of a smart distribution system. Our results are discussed within the context of the assumptions and limitations of the model, which suggest directions for future research.