Electric Utilities VAR/VVO wins with 5G and IoT - PART 2

By Ken Caird, Chief technology Officer, Energy & Utilities at VNCTech Group 

In my previous blog in this series, I discussed the impact of 5G on Conservation Voltage Reduction (CVR) and what financial impact it can have for utilities. Please feel free to check my previous article on how Electric Utilities CVR wins with 5G and IoT by going to my VNCTech Group Energy & Utilities page scrolling under "Publications".


CVR was about reducing load on distribution feeders and peak power reduction. In this article I discuss Voltage and Volt Amp Reactive (VAR) Optimization (VVO). I’d like to present three use cases where traditional VVO supplemented with 5G, low cost sensors, and IoT technology will deliver significant cost savings to electric utilities. 


Use case #1

VVO is a program designed to reduce losses or in other words increase efficiency on a distribution feeder. These types of losses are referred to as technical losses, whereas theft of power is termed a non-technical loss. Technical losses can be as high as 5 to 7 % of total load of a feeder. If you translate that into fuel costs you can see, depending on size of utility, it can save millions of dollars annually if we can substantially reduce these losses.


The demand or load capacity of a distribution feeder is usually limited by voltage drop along the feeder rather than the thermal capacity of the feeder conductor. Again, as I discussed in Part I, the service entrance voltage of all customer premises must be kept within certain limits set by international standards. In North America, the applicable standard is ANSI C84.1 which specifies a +/- 5% voltage variation. If we use 120 volts as a reference, the voltage at the customer premise can vary from 126V to 114V.


The voltage drop along a feeder is cause by two factors:

  • The resistance (R) of the conductor

  • The reactance (X) of the network

Resistive losses are heat (the element of your stove is a resistor) and reactive losses are charging capacitors and magnetizing inductors (e.g. the core of a transformer or winding of a motor).


Neither of these losses are metered at the customer premise so are thus a financial loss to the utility. Again, losses of 5-7% can costs utilities millions of dollars annually.

So, going back to our high school physics days we know that:


Total Losses = RLine x I2resistive + XLine x I2reactive


Since line resistance is fixed, the only way of reducing I2R losses is to reduce the current. We can reduce current by reducing voltage since I = V/R. Voltage reduction can be used to reduce system losses. However, again, we must be compliant to ANSI C84.1 standard. Currently there is little voltage measurement if any along the feeder that can be telemetered back to the VVO application. Typically, “rules of thumb” or “engineering estimates” are used, which are usually very conservative, to set line voltage using Load Tap Changers (LTC’s) or voltage regulators. This conservative approach leaves a lot of money on the table.


Use case #1

5G and low cost IoT voltage sensors (below $100/sensor) located at the customer premises will give the VVO application real time access to customer voltage information. This may be a smart meter or any IoT device in the home or a specifically designed voltage sensor. By implementing IoT and specific software applications, VVO will be provided the exact customer voltage and can fine tune its control of LTC’s and voltage regulators to reduce losses to an absolute minimum in real time using the existing 5G communication infrastructure that has the bandwidth and capacity to handle hundreds of thousands of devices in real time.

Use case #2

We know the biggest technical loss on a distribution feeder is VAR losses caused by electric motors. Electric motors are ubiquitous and can be found in factories, air conditioners, refrigerators, furnaces, etc. Motors are inductive thus they absorb VAR’s. Utilities compensate for the motor VAR losses by placing capacitors at strategic points along a feeder. Capacitors inject VARs and thus compensate for the VAR’s used by the motors. Again, engineering estimates are used in placement of these capacitors and when to turn capacitors on and off. Again, there is little real time measurement if any of VAR’s or Power Factor conditions along a feeder.


Use Case #3

Once again, 5G and low-cost VAR/Voltage sensors play a key role in optimizing the reduction of VAR losses. With the right applications and IoT configuration layered with 5G, VAR will be provided the detailed information along a feeder delivering two core benefits:

  1. It helps engineers optimally place capacitor banks along the feeder where the capacitor banks will have the greatest impact in VAR reduction and power factor correction.

  2. It allows the VVO application to optimize when it turns capacitor banks on and off to maximize VAR reduction.


Control of capacitor banks introduces an ancillary problem, when VVO turns on a capacitor bank to reduce VAR losses it increase the feeder voltage, due to reducing voltage drop cause by Ireactive * XLine . This is called “competing objective functions”. Thus, the VVO application must now determine which will reap the better rewards, turning on the capacitor and increasing the voltage or leaving the capacitor off and keeping voltage low.

This can be optimized with the right applications, 5G, and deployment of thousands of low cost IoT sensors providing precise voltage and VAR measurement along the feeder.

In summary, feeder losses cost utilities hundreds of thousand if not millions of dollars a year. Current VVO programs are only part of the solution. The right software applications, 5G, and IoT sensors can greatly enhance the performance of VVO applications saving utilities hundreds of thousands or millions of dollars.


Transitioning to such a new technology as 5G and IoT sensors will require transformational and a new type of leadership. Technical requirements will have to be clarified, R&D programs will have to be implemented, design for manufacturability on a large scale will be imperative, cost targets identified, roll out plans and schedules created, and lastly a “go to market” strategy agreed upon.


Presently, there is a great opportunity for smaller tech companies to obtain incredible market share if they make the right decisions and invest in this new type of technology leadership. I believe the utility associated tech companies, who embrace dynamic technology leadership to plan and execute the nearby future, will be laying the foundation towards becoming the largest and most successful Company in the industry.

Chief Technology Officer

Energy & Utilities

VNCTech Group



Dallas, Texas, USA

VNC Technologies Company

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