SmartGrid and Renewable Energy: The Unresolved Questions

As the electricity industry forges ahead in defining and ultimately implementing SmartGrid and transitioning to a supply portfolio that includes renewable energy sources, there are a number of unanswered questions and obvious objections that must be confronted to ensure the full benefits of improved reliability, increased energy efficiency, and reduced CO2 emissions.  These questions include:

• Will the anticipated increase in electricity costs tied to SmartGrid and renewables have an adverse affect on the economy? And, if so, will these increase invoke a backlash of resistance to the underlying initiatives?
• Does SmartGrid ultimately lead to external (or even worse mandated) control of major uses of electricity (e.g. home appliances, and heating and air conditioning systems)?

Combined with recent indications that concern over global warming (and in general, addressing energy problems) has waned, these questions represent implied barriers to ultimate success. But for the initiation of legislative mandates and supporting regulation, electric utilities would be significantly challenged to make a strong business case for moving forward with SmartGrid related investments.

Potential Solution – Improved Communication

Recognizing this reality, there are a number of initiatives that electric utilities would be advised to consider:

• Develop public outreach programs to more clearly define the capabilities and intended uses of smart meters. They should proactively counter the notion that a smart meter represents a means to track one’s movements inside their own home.
• Shift the discussion from the potential for outside control (and the inherent benefits of such control) to the cost savings a typical homeowner can realize. Electric utilities tend to present benefits specifically from their perspective and do not take into account the holistic benefits to be captured by “active” participants in reducing peak load demand and improving overall efficiency.