Smart grid skepticism

2009-10-20

in Economics, Geek stuff, Politics, The environment

The Economist argues that the popularity of so-called ‘smart’ electrical grids is cause for suspicion. The fact that builders of renewable energy plants and operators of dirty coal plants are both on side suggests that the grids will not, in and of themselves, produce a push towards reduced greenhouse gas emissions. Indeed, if they reduce the amount of extra capacity required and cut energy prices through greater efficiency they might encourage increased usage and thus increased emissions.

The point is well taken, as is the argument that legislation is required to ensure that new technologies actually lead to climate change mitigation. Without government-created incentives like carbon pricing, we cannot assume that technological advancement and voluntary action will lead to reduced emissions.

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. October 20, 2009 at 10:04 pm
. October 28, 2009 at 10:16 am

Smart grids
Wiser wires

Oct 8th 2009
From The Economist print edition
Information technology can make electricity grids less wasteful and much greener. Businesses have lots of ideas and governments are keen, but obstacles remain

Smart grids are neither a surprising nor a new idea. It is well known that systems transmitting and distributing electricity are exceedingly wasteful and vulnerable. Huge amounts of power are lost to technical problems or theft: up to 10% in America and Europe; more than 50% in some big cities in developing countries. Outages cost the American economy $150 billion a year.

For applications that run on smart grids, it is still early days. EnerNOC gives a hint of things to come. The speciality of this American firm, whose share price has more than quadrupled in the past 12 months despite the crisis, is demand response. It promises utilities to supply them if they need additional power and is paid as if it were keeping physical plants ready. In fact it has agreements with many firms, which it pays for the privilege of being allowed to shut down their non-essential gear if need be, thus freeing up capacity. As of June 2,400 customers, from steel plants to grocery stores, had signed up. They represent 3,150MW, the output of about 30 peak-power plants. But EnerNOC also wants to use the equipment it has installed and the data it collects to offer something called “continuous commissioning”: making sure that big buildings, for instance, do not start to waste energy.

Nor does it help the business case for such an investment, that smart grids by definition reduce demand—and thereby revenues and ultimately profits. Only a few states, such as California, have decoupled both, making utilities no longer concerned about selling less power. The risk, says Adam Grosser of Foundation Capital, is that many utilities will go only halfway, and will not build a complete smart grid that reaches into the home.

. November 4, 2009 at 6:08 pm

How Privacy (Or Lack of It) Could Sabotage the Grid

By Jules Polonetsky and Christopher Wolf

In October, President Obama announced $3.4 billion in federal grants to help build our nation’s Smart Grid. The President said that the technology that will make up the Smart Grid will make the nation’s power transmission system more efficient, encourage renewable energy sources and give consumers better control over their electricity usage and costs.

The potential benefits are clear. Far less obvious to many is that the smart power grid is also a smart information grid, a system that Cisco’s CEO has predicted will be bigger than the Internet. But while Internet privacy issues are limited to the Web activities of users, the Smart Grid will involve the collection of information about what goes on at people’s homes. As Commerce Secretary Gary Locke stated this September, “The major benefit provided by the Smart Grid… is also its Achilles’ heel from a privacy viewpoint.”

This fall, the National Institute of Standards and Technology (NIST) identified several potential data privacy concerns involving Smart Grid technology. They include the threat of identity theft, the possibility of personal behavioral patterns being recorded and real-time surveillance.

Clearly, a significant amount of new and intimate consumer data will be available through Smart Grid technology. There are numerous potential users of the data, including utility companies, smart appliance manufacturers, and third parties that may want the data for further consumer interactions. Moreover, data that can be collected through smart meters and integrated home networks and appliances has significant value. For example, Smart Grid systems may incorporate advanced broadband and data flow metering functionality, which can collect information about how much electricity an individual uses, which rooms he or she uses most, when, and how often. Armed with this data, utility companies will be able to manage load requirements better and create a more efficient electricity distribution system. In addition, device manufacturers will be able to understand better how their devices are used, allowing them to serve their customers better. These Smart Grid features, however, raise questions about which entities will have access to individual user data and whether individual devices may be identified or tracked.

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