Smart Grid – Challenges and Opportunities

Smart Grid, with all of its features and potential to redefine the electricity market, can easily become disconnected from the wants and needs of the customers it is designed to serve. The challenge is clear yet not easy:

  • Electric utilities must position themselves to listen to what their customers want and are willing to pay for, yet
  • Recognize that their customers are not always able to articulate or even be aware of their needs or the possibilities.

This dichotomy places the electric utilities in the unfamiliar role of listening, yet driving the customer to see the value of technologies and solutions that they would not otherwise view as necessary or even desired.

Key Challenges in Driving Customer Support for Smart Grid

Electricity is generally viewed as a commodity, one largely taken for granted by customers until they experience a service outage. The

 real price of electricity has been virtually unchanged over the past half century, and the only significant technological change during the time period was the development of nuclear technology, a solution that has been met with mixed reviews. The new challenges confronting the industry are numerous:

  • There are a number of technologies to be adopted ranging from developing a more comprehensive energy supply profile (e.g. renewable sources) to the type of communication architecture to use in enhancing automation. This will require the establishment of pilot efforts and visible demonstration of numerous “failures” and some rather significant successes.
  • The implementation of technologies must be rapid to ensure proper integration and operability of the system.
  • Interoperability, open architecture, and cyber security are newer variables that must be effectively integrated into overall smart grid strategies.

    Electric Grid

  • Customer education is essential as the more passive approach of merely turning on a light switch will not suffice for customers to realize the real benefits of these technologies. Failure to make this connection will most assuredly lead to customer disatisfaction as rates increase but the perception of value received remains constant.
  • Consistent with the previous point, electric utilities will need to be more explicit in managing customer expectation, including both the hype and challenges inherent to their evolving technological vision.

Ultimately, the industry needs to promote the value and importance of energy efficiency, and demonstrate how these new technologies support this vision.

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