What’s Holding up the Smart Grid?

With oil prices on the rise and green energy on the US presidential agenda, smart grid implementation should be moving fast. But according to the Microsoft Worldwide Utility Industry Survey 2011, it's not. While 70 percent of respondents believe the smart grid will address tomorrow's energy challenges, utilities are still seeking clear implementation guidelines.

The upside, according to the survey, is that utilities are more willing to spend on the smart grid planning process than in previous years. Utilities need architectural and implementation guidance to be certain that future smart grid technology advances will fit with their existing technology investments.

“We're seeing a normal phenomenon occur in terms of the evolution of thinking about these projects,” said Jon C. Arnold, managing director for Microsoft's Worldwide Power & Utilities Industry, and a member of Smart Grid Advisory Committee to the National Institute of Standards and Technology, in a press release. “Utilities are finding out what they don't know, and they are, naturally, exerting some caution before making big investments, even though the willingness to spend is there.”

According to the press release:

In similar ratios to the 2010 survey, utilities professionals and executives (72 percent) perceive distribution management as the most important solution needed for successful smart grid implementations. Many (60 percent) see their budgets for distribution and energy management technologies increasing this year.

More than 50 percent of respondents see their customer information systems changing dramatically as a result of the smart grid, with many utilities looking at replacements or working to find ways to adapt their systems to interval billing, electric vehicles, and other demand-side management and new energy programs. Bills will become more complex, according to 56 percent of respondents, and significant business operation restructuring must occur to achieve the vision of a fully integrated smart grid.

The smart grid is a welcome challenge for the electronics supply chain, which has been looking to get in on it for a number of years. As well as IT investments, utilities companies will have to upgrade hardware, and opportunities for the electronics supply chain include components such as sensors, controllers, and other “intelligent” electronics. Communications networks linking the grid to utilities companies and end-users are another plus.

But before any hardware ships, both standards and infrastructure issues need to be addressed. The National Institute of Standards and Technology's smart grid advisory committee is working on that. (See Smart Grid Seeks Sourcing Partners and Smart Appliances Are Coming, But Where’s the Smart Grid? .)

16 comments on “What’s Holding up the Smart Grid?

  1. Jay_Bond
    March 10, 2011

    You raise a valid question. The president has stated many times that greener smarter technology is going to be at the front of the pack for priorities. The president has also gotten some major players in the business world involved in this large task. So with all this brain power and funding available, why hasn't more progress been made? Maybe the utilities companies are trying to find the win-win situation. How can they contribute to and comply with these new regulations, while still being profitable?

  2. AnalyzeThis
    March 10, 2011

    Barbara, I agree that one would think that smart grid implementation would be moving faster than it currently is, but as you mention there are still some very crucial issues that have yet to be addressed.

    You mention the standards and infrastructure issues, and related to that, the whole security issue: there have been hysterical reports in the mainstream media already paranoid about hackers taking over the energy grid and… I don't know… using it to electrocute children or something, but despite the sensationalism security and reliability is a valid concern.

    The other difficulty is the lack of consumer interest. One could very validly argue that the reason broadband has penetrated the US market as much as it has is because consumers in massive numbers essentially demanded it. There isn't even close to anything like that kind of demand for smart grid. If anything, there's probably a lot of consumer trepidation because they don't like the sounds of more complicated billing practices and things like that.

    Anyhow, long-term, I think smart grid tech makes a ton of sense and after all we can only survive for so long on our current current systems. But there will be many challenges ahead and I do believe that progress will remain frustratingly slow for the remainder of the decade.

  3. Wale Bakare
    March 10, 2011

    Am very sure stakeholders in evolution of smart grid technology are working round the clock.

    Managing smart grid infrastructure is a herculean task, so also well consolidated regulations must be sort for and achieved with respect to parties involving in the project. I think government is responsible for this.


  4. Mr. Roques
    March 10, 2011

    Maybe there's an effort by the utility companies to stall the growth until they can really figure it out and find a win-win situation (or at least a situation where they win).

    From my experience, I see a closer approach from electric companies going into the telecom business, than the other way around.

  5. tioluwa
    March 11, 2011

    The caution of the Utilities is understandable as business people. However, they can't hold back for much longer. I believe there will be some gamble in it, if a very flexble system cannot be designed on time, which will be able to integrate all the technologies coming up in the area of SMART GRID and SMART METERING. I don't think that perfect moment will come, it will be developed over time.

  6. t.alex
    March 11, 2011

    Probably for mega insfrastructure projects, standardization is one of the key factors. Given the various technology and protocols for smart grid nowadays, it is challenging to bring all of them together.

  7. mfbertozzi
    March 12, 2011

    @t.alex: in my eyes, you are right, decision makers are freezing investments and still waiting for standardization holding concerns on bad choise to approve, especially in the current financial crisis timeframe, but…standards come after projects delivered…OSI model had got similar origin…


  8. Hardcore
    March 14, 2011

    We just keep laying down on the tracks and letting the 'stupidity' train ride over us.

    Once again this technology will be utilised by big corporations to sell us more and to increase our consumption.

    How is any  publicly owned company going to leverage a technology that saves the customer money and in effects cuts thier profit margins, more importantly how are they going to sell that to their shareholders?

    Keeping aside any issues related to 'security', do people who read this material really believe the hype that is being passed off as helping mankind get to grips with energy wastage?

    The more likely outcome of this will be appliances that continually monitor your environment, your personal behavior and your purchasing/energy requirements , then leverage this information so that it can be packaged up and sold off to the highest bidders.

    Link that with Geo-location of your mobile phones and build a cross-referenced network to track you 24 hours a day.

    I live in China and they are already a good way down the line on implementing this.

    Once in a while the power will be cut and then monitored so that they can see if people are in the premises.

    Not to mention that my electric meter can be read remotely.if my aircon is cycled, fairly soon my phone starts ringing and people start trying to sell me stuff, or offering me new appliances.

    Another example of meta-data being leveraged to sell things I do not want.

    Just becareful what you wish for ……… you may get it.










  9. elctrnx_lyf
    March 14, 2011

    The question of smart grid and its advantages is been a question among the many technologists also. What are we going to really gain out of developing complete new infrasturcture to monitor the power consumption of each and every equipment indivdually. I think money lies in designing of equipments running with alternate powers sources. Expale like a mobile running on a complete solar chargeable batteries.

  10. William K.
    March 15, 2011

    The reason for a lack of consumer enthusiasm is that there is not much associated with the smart grid to benefit the ultimate customer. Those yelling loudest about the “benefits” keep talking about linking rates to demand, which only means charging more when people want it the most. That certainly does not benefit ME!  

    What we certainly do need is much better communication within  the grid, and better control, so that sections in trouble can be dropped much more quickly. That would have prevented the last big blackout, and left a much smaller area in the dark for a much shorter time. The technology to provide this has been around for a while, but it was never installed because it does not increase monthly profits. 

    The security issue would be solved instantly if the meters were to only report a month's power consumption, not hour-by-hour, as some believe would be best. The utility could send out hourly price changes and not interfere with anybodies activities or security. The utility already has instrumentation at the substation level to monitor consumption there, so why report from every meter every hour. That individual useage data is only needed for billing, it is not what they need to tell how much capacity to turn on.

  11. stochastic excursion
    March 16, 2011

    Signal modulation of AC power is a technology that has been on the back burner for some time.  With some differential LF noise cancellation and RF/microwave coupling, you can send a lot of data back and forth on a power line.  This would enable you to remotely upload files to your cell phone while it's charging, for instance. 

    Rolling out a data layer on top of the power grid makes sense, and utility companies could save money by assessing people's consumption remotely.  The hour-to-hour monitoring seems like information-hungry overkill though.

  12. prabhakar_deosthali
    March 17, 2011

    Implementing a smart grid requires a lot of standardization  which may take years to evolve and get accepted by the participants. If an individual home is made smart, I mean energy smart , a local controller in each home would manage the electricty consumption in that home by optimising the energy drawn from the grid based upon the utility company tarrif structure. Such home controllers could communicate over internet ( wired or wireless) to get the latest utility regulations based upon which to optimise the energy consumption. These controllers can even find out the current demand on the grid in real time and automatically adjust the energy consumtion in a given house.  Such technology is easy to develop and will promote many a private entrepreneurs to come up with suitable products

  13. hwong
    March 22, 2011


    What you described here about “better communication within  the grid, and better control, so that sections in trouble can be dropped much more quickly” is precisely what Barbara's article referring to as Distribution management.  Sensors are attached throughout the distribution grid to store load and temperature data as it enable monitoring the distribution line for loss of voltage, loss of current and faults. In addition, there is a software application that will relay information between SCADA (Supervisory control and data acquisition) and reclosers, sectionalizers, feeder switches, capacitor banks and controllers, transformers and voltage regulators. Having an understanding of the status of these devices in real time enables much faster outage detection and notification and improves fault location and isolation. It also increases energy efficiency through better capacitor and voltage control and improved asset management.

  14. hwong
    March 22, 2011

    @stochastic excursion

    Actually utility is getting even more granular level to having interval data for every 15 minute vs. hour-to-hour monitoring. The reason they need it to that level is that  it will help with the Time of Use functionality whereby it's easier to monitor, predict and control energy flow. If you imagine having a bar chart where X-axis is the interval data by the hour and Y axis is the energy consumption, the more granular it is the better Utility have visibility into when is energy in highest demand. If Utility has this information, then Utility can try to shape this curve by implementing programs such as Critical peak pricing or Time of use pricing. These programs are available to customers so that consumers like us can determine when not to turn on the dryer if the price at the peak hour is 5 times higher the normal hour. This will help save electricity.

    Remember the basics, energy cannot be stored! If Utility can be stored, then none of this would even matter. But because energy is lost if not used. So utility can better manage the supply by not having to procure too much energy.


  15. stochastic excursion
    March 23, 2011

    I'm getting the impression a lot of the smartness of the smart grid has to reside in the consumer, enough to know not to turn their hair dryer on at peak consumption periods.

  16. hwong
    April 18, 2011

    Well you can also think of it another way. If you and I are willing to sign up and let our utility control our thermostat by a few degrees during the hot summer peak times, then the utilities will see us as a type of energy  “resource”.  Utilities generate electricity by tapping into different resources such as coal, natural gas, nuclear and other renewables. So utilities' demand response program is one type of resource. Consumer of course can opt out during a specific event but still, it can add up to help reduce the load.


    Another smartness of the smart grid is when they install the sensors to monitor and control the devices within the distribution substations.  These include monitoring Voltage, transformer, capacitor bank, recloser and line switch etc. The whole idea is to optimize the energy flow and communications network within the electricity grid.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.