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Shaping the grid of the future

In a special edition of Factor This!, live from DISTRIBUTECH and POWERGEN International in Dallas last May, hear from Jim Walsh, who leads GE's grid software business, about the enabling forces behind the energy transition.

How to manage and monetize distributed energy resources is one of the most rapidly changing pieces of the energy transition.

Every few weeks it seems a new software startup has raised tens (sometimes, hundreds) of millions of dollars in pursuit of those challenges. Meanwhile, utilities are watching the electricity distribution model that has stood up for a hundred years get turned on its head.

In a special edition of Factor This!, live from DISTRIBUTECH and POWERGEN International in Dallas last May, hear from Jim Walsh, who leads GE’s grid software business, about the enabling forces behind the energy transition.

Make sure to subscribe to Factor This! wherever you get your podcasts.

Factor This!  is produced by Renewable Energy World and Clarion Energy. Connect with John Engel, the host of Factor This!, on LinkedIn and Twitter.

Video interview Factor This! full episode listEpisode transcript

Jim Walsh, GE General Manager of Grid Software  00:09

This was the sort of transformation that a leader like me looks for, for their entire life. Transformation is a global imperative.

Host: John Engel  00:20

Distributed energy resources and how to manage and monetize them is one of the most rapidly changing pieces of the energy transition. Every few weeks, it seems a new software startup has raised tens, even hundreds of millions of dollars in pursuit of those challenges. Meanwhile, utilities are watching the electricity distribution model that has stood up for over 100 years get turned on its head.  I’m John Engel and this is a special edition of Factor This! — live from DISTRIBUTECH and POWERGEN International in Dallas last May. Next week, we’ll be back to our regular format, diving into solar’s most important stories with leaders who actually move the needle. But for now, let’s take a look at the other side of the equation with someone who knows it best. Here’s my conversation with Jim Walsh, who leads GE’s grid software business, live from DISTRIBUTECH and POWERGEN International. Jim Walsh, thank you so much for joining us on Factor This! here at DISTRIBUTECH 2022 in Dallas. You are the general manager of grid software at GE. And and I really wanted to talk to you as we’re trying to grab some of the major themes that we’re hearing from DTECH for a lot of reasons but software, DERMS, how to manage distributed energy, that seems to be the lion’s share of conversations that I’m having. And I’m hearing that seems to be most of the attendees and and suppliers that we’re visiting with. What have you taken away from the current landscape of DTECH knowing the transition that that the transmission and distribution, you know, industry has gone through? Well, you mentioned the resiliency component of this, and I did see a report I think it was a week or two ago from NERC, as they’re looking forward to summer reliability concerns, and how our grid going to hold up to, to record heat, to the immediate impacts of climate change that we’re already seeing. And there’s concern about, you know, the solar tripping of inverters on the distribution grid, these are all things that that DERMS providers like GE are taking into account, how are you adapting that offering to not only reflect the changing dynamic of generation, but also the near-term and very real impacts of climate that we’re seeing?

Jim Walsh, GE General Manager of Grid Software  01:58

Yeah, well, listen first thanks for having me, John. I think you hit the nail on the head. It really is an overwhelming tidal wave of really people trying to solve for what we refer to as energy transition. So this notion of moving from kind of a one way power flow, where you’ve got power plants off in the in the hinterlands, pumping power in one way through the transmission and distribution grid, to a whole new paradigm, where you’ve got intermittent generation that’s happening at various points along the grid, including the distribution grid, and I think operators are really focused on how do we maintain the level of resiliency that we need? How do we how do we ensure affordability? And oh, by the way, how do we meet the commitments that we’ve made as it relates to decarbonisation and sustainability? So it’s really a trilemma that people are trying hard to solve. And that really is the overarching theme of the show. Yeah, boy, you, you did a really nice job of encapsulating a whole bunch of dynamics and Listen, I think, I think the world is really waking up to the criticality of the grid. And I’ll get to an answer your question here, but but I think it’s important to frame up the problem statement a little bit, you know, for a long time, the discussion around decarbonisation was really around how do we get more solar panels into the into the world? How do we get more wind turbines, and all of those are noble and all of those are obviously very important as it relates to decarbonisation. What people now are faced with though, is we can generate all the green electrons we want to but if we can’t reliably get them from the point of generation to the point of consumption, decarbonisation grinds to a halt. In comes, the grid is a really central figure in this play. And as you know, the grid was not contemplated with with the sort of dynamics that you described, did a great job of describing. It wasn’t contemplated with those things in mind. And so, obviously, there’s there’s not the ability or the desire to go out and replace the physical infrastructure of the grid. Instead, we’ve got to transform the grid. And a big way to do that is through software. And so our mission is really how do we help great operators maintain a level of sustainability? Reliability, affordability, and do so by changing their existing infrastructure through software? And so how do we give them better visibility than they’ve ever had before, relative to the assets that are on the grid? How do we take all of these different new generation components and be able to incorporate them into a load and be able to distribute that effectively? How do we help them have better vitality in terms of balancing the grid? Better real time control? So it’s a complicated algorithm. It’s a complicated equation. But we’re excited about it, because frankly, that’s what we do for a living. How does approaching that problem statement that you mentioned differ for, say an IOU, a large utility, then smaller community utility — a muni, or a co op — is there a different complexity? Or is it is this adjustable with with scale and and the services remain the same, whether you’re big or small?  Well, I think… certainly complexity, with with the bigger guys is going to be more acute. You know, you’ve got more variability on the grid, you’ve got a bigger area that you’ve got to manage, you’ve got more constituencies that you’ve got to solve for. But the fundamental problem of keeping the grid imbalance as you introduce intermittent generation sources, is going to be something that has to be dealt with at at big scale. And at small scale, we find ourselves now working with a lot of large IOUs, in particular, because the problems most acute with them, but I think a lot of the learnings that that that we’re capturing will ultimately be incorporated, because ultimately, where you have to get from a grid standpoint is one big, interconnected network. And so regardless of who’s administrating it, I think the notion of orchestration is going to be paramount for all of them.

Host: John Engel  07:18

You know, solar has reached a state of maturity, you know, here in 2022, and is on grids all over the country, but dealing with solar, dealing with intermittency, it’s still something a lot of utilities struggle with in in knowing what they need to balance to manage that resource. And I think it gets even more difficult given the saturation that we’ve seen in the in the DERMS market. As I said, half the floor here seems to be a DERMS provider in one way or the other. I’m getting funding announcements, seemingly every week of 100 million, 200 million of all of these DERMS acquisitions or funding rounds, GE has been in the mix there, with key acquisitions over the last year, how does a utility make that decision then in deciding what’s best for them, given so many entrants into that space?

Jim Walsh, GE General Manager of Grid Software  08:13

I think what we’ve seen in the industry for maybe the last five years have been a lot of kind of pilot scale projects, you know. The utilities have seen this freight train coming from a long ways away and to their credit, they have done some experimentation. Now, especially as as renewables penetrate at much, much larger scale, as you mentioned, in particular, certain geographies are forced to say we’ve got to be out of pilot mode. And so what we think differentiates our approach is we we not only have got DERMS capabilities, but we integrate them into our operational systems, a system that we call ADMS, which is a way to think about it as kind of the flight control system, the air traffic control system for the distribution grid. So we’re we’re watching electrons, we’re helping utilities keep things in balance. There are these new class of electrons called DERMS, that are coming onto the grid. And so we need to be able to seamlessly incorporate those into the air traffic control system in real time and real time, in real time. And so that’s really what our our focus is. And I think that’s where a lot of the investment that we see in the industry is about it’s about building more robust capabilities around managing DERMS, but also incorporating them into the more foundational parts of the system that ultimately operate the grid.

Host: John Engel  09:42

So then what are you and your teams working on now as you think about the evolution of DERMS and just overall management of distributed energy to evolve that offering and how do you see that the industry progressing? If you if you had to forecast five to 10 years, which I know you do behind the scenes anyway, what do you what do you see as the biggest opportunity?

Jim Walsh, GE General Manager of Grid Software  10:03

Yeah, with different levels of fidelity? Yeah, sure. But especially in this industry that’s changing so quickly. But look, our fundamental view is that the grid will become, needs to become, autonomous. And the reason it needs to become autonomous because the level of complexity is more and more endpoints are added onto the grid and an endpoint could be a solar panel, it could be a wind turbine, it could be a battery, as an example. The point is the number of devices that will have to be part of this orchestration, mosaic are growing exponentially. Our view is that there’s no way in the long term that to optimize the grid, you’re going to be able to keep going back for human intervention every time a change needs to be made. So a big part of our focus right now is how do we do a better job of laying up the grid for the grid operator? How do we make sure that, that they’ve got visibility in near real time, to all of these assets as they’re being added on to the grid, because that is one of the challenges that utilities have. Somebody puts a solar panel on their roof, there may or may not be standard work for the utility as it relates to how to go register that. And if there’s not, oftentimes there are a number of generating assets on the grid that you as a grid operator don’t have visibility to. And so solving that fundamental problem is a really big step, I think in terms of getting into this new paradigm of orchestration. So we’re working on that. We’re working on on we, as you correctly pointed out, we have been in the acquisition game, we bought up the Opus One, a company we’re really excited about. We’re integrating that tightly into our our advanced distribution management system.

Host: John Engel  11:53

Is that still underway?

Jim Walsh, GE General Manager of Grid Software  11:54

It still it is, in fact, we’re demonstrating it here at at DISTRIBUTECH. So we have done the technical work required in a relatively short period of time to get that done. But there are also customers who are interested in a standalone DERMS capability, be it for creating markets as an example on the distribution wholesale side of the house.

Host: John Engel  12:20

So under FERC order 2222, they don’t have much choice over the next few years. So that’s another but that’s another element that the regulatory framework as we go forward is changing, such that a lot of major decisions have to be made in order to maintain that resiliency and, you know, resource availability. Is that a concern that you hear from either existing customers or people you’re just talking to in the space, when they say, you know, these timelines, they may look long to do some on the outside, but five years for a full overhaul of how we handle the ers is, is not a lot.

Jim Walsh, GE General Manager of Grid Software  13:01

I think that’s right, I you know, you’ve got some competing dynamics here, though. And at the very top of everybody’s list, is I think the debate over the criticality of decarbonisation seems to have sort of withered away. And the only way you’re going to decarbonize the planet, is by virtue of driving some of these changes that that we’ve been talking about over the past little while. So if you take that as sort of a given, everything else becomes how do we optimize our way there? And so I think everybody… what, when you’re in an industry that fundamentally hasn’t changed a lot in the last 100 years, and now is in really upheaval. I mean, the way you describe it, the technology is changing; customer expectations are changing; regulations are changing. In fact, even the way people make money is is ultimately changing. You put all that stuff in a blender, and yeah, there’s there for sure, is just some monies. But again, for a company like us, who really has been in and around the space for a long time, and it’s got an amazing breadth of capabilities. We see this as a great opportunity to lead.

Host: John Engel  14:17

You mentioned you use the word mosaic earlier when you were talking about the platform, but I also think there is a mosaic of challenges that face just energy at large. You know, net metering overhaul is happening, the proliferation of DERs is happening. We have trade disputes that are really impacting renewable energies. And all of these things, none of them exist in a vacuum, they all interact with each other. They have the supply chain constraints. We have we have to adjust to a changing and modernizing grid… What is then the roadblock or what’s the biggest challenge for your teams as you’re trying to provide what is the best overall package for for utility, there has to be something that’s also, you know, holding the back for you guys.

Jim Walsh, GE General Manager of Grid Software  15:03

Yeah, listen, I think the… Believe it or not one of the biggest challenges is data. And, and, and not access to data anymore access to data is is relatively ubiquitous, it’s easy. But what we find is that as our utility customers have grown up over time, they have built multiple data models to represent the same physical world. And so when you think about a paradigm like orchestration, where something happens here, on the left hand side, and and you automatically have to trigger something on the right hand side, that kind of orchestration. If you’ve got multiple data models that you’re trying to reconcile between, that becomes really difficult. And so I think what we are preaching to our customers is, let us help you get your data in order, let us get one has to be the first step. Yeah, that has to be the first step. Let us get one accurate, dynamic representative of your physical world digitally, and then boy, there’s an awful lot that we can do to accelerate from that point. But if you don’t get that foundation, right, it’s, you’re going to be building and hedges, right? On every optimization algorithm that you have. And that doesn’t lead to orchestration.

Host: John Engel  16:19

You’re not new to this space, you’re not new to GE, what excites you most about where you’re at right now, in your role? On the grid software side?

Jim Walsh, GE General Manager of Grid Software  16:31

Listen, this was the sort of transformation that that a leader like me, looks for for their entire life. I’ve been blessed to run some really interesting businesses and learned a lot of lessons along the way. But boy, I’ve never been in a space where transformation is a global imperative. And you’re working with a bunch of customers who really need you. And and that’s fun, and the CO innovation that’s happening along the way. It’s just as a sort of mission that that’s really easy to get excited about. You know, I know that the that our business as we deliver capabilities and solutions… Gosh, for my children, my grandchildren, there’s going to be an impact and how many businesses can you say that about?

Host: John Engel  17:28

That was Jim Walsh, GE’s general manager of grid software. That’s it for this special edition of Factor This! — live from DISTRIBUTECH and POWERGEN. I’m John Engel. Get involved in next year’s events by answering the call for content from energy industry experts. We have more information at RenewableEnergyWorld.com. Factor This! is a production of Renewable Energy World and Clarion Energy. Follow us on LinkedIn and Twitter and let us know what you think of the show by leaving a review wherever you get your podcasts. We’ll see you next time.

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