3 smart-grid trends to watch in 2012

Security, automation and integration will be the trinity of tasks faced by utilities, technology platform providers during the next 12 months.

The Year in Review, the Year Ahead

I had plenty of opportunities to think about the smart grid in northern New Jersey this year. First, a hurricane cut my power for almost four days. Then a freak Halloween snow storm took half of my town off the grid for more than a week. My own power during that time period switched on and off several times during that timeframe, as the utility crews worked feverishly to repair thousands of downed lines all over the state.

When I think back to all the green tech stories I've been faced with during 2011, smart grid developments were actually few and far between -- at least publicly speaking. That doesn't mean there isn't meaningful work going on; it just means that the attention shifted somewhat during 2011, and that a lot of the progress was happening behind-the-scenes. So what does that mean for 2012?

Here are 3 trends that I will be watching far more closely over the next 12 months. (Yes, I am aware this just became an open invitation for companies involved in these areas to seek an audience/interview!)

  1. Security: The alarmists have been warning us about smart grid security for months, but late in 2011, more people began paying attention. The reason? An apparent breach in Illinois of supervisory control and data acquisition (SCADA) systems at a utility company. Although the incident turned out to be more benign than originally suspected, it pointed up a very real gap in security investments related to SCADA and other technologies being linked into smart grid applications. If the smart grid has any hope of becoming reality, a lot more attention must be paid to this issue.
  2. Automation: To return to the anecdote with which I began this post, the chain reactions that happen when parts of the electric grid are compromised have become far more dramatic and far more than an inconvenience. While a lot of coverage of smart-grid technologies focuses on the consumer-facing meter technologies and services, the stuff that happens to self-heal and isolate problems on the grid will have far-reaching consequences. Automation of distribution and demand is the core promise of the smart grid. The challenge is that this is complex stuff that requires significant investment in information technology.
  3. Micro-grid and renewable energy integration: In 2011, I heard about many examples of companies switching to fuel cells, solar or other renewable energy technologies to pick up part of their energy consumption needs. Many of those projects account for a minimal proportion of total consumption, though, which means that increasingly many different sources will be powering businesses around the United States. The extent to which these systems can be integrated back into the grid will make them useful not just for the companies deploying them but for the electric utilities serving those businesses.

What of the consumer end of the smart-grid equation? I remain pessimistic until utility companies and smart-grid platform players get their house in order with respect to the three things I mention above.

It isn't that they don't care, it is just that the level of distraction from other concerns, such as the high U.S. unemployment rate, Congressional gridlock, payroll taxes and more fundamental economic concerns will continue to make it difficult for the smart meter message to get through the noise. Even though most of us are all supportive of the energy efficiency promised by smart meter technologies, conceptually, the behavior changes that true savings require will take much longer to occur.


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