10 Big Questions About the Smart Grid

I’ve mentioned that smart grids will introduce energy efficiencies to better support the increasing demands for electricity while reducing environmental impacts. And consumers will have opportunities to use in-home energy-management tools, programmable appliances and other applications that improve their quality of life.

Unfortunately around 68 percent of consumers have no idea what a smart grid is and their understanding is needed to help gain acceptance for the technology. We need leadership in the private and public sectors to educate consumers, as well as incentives and other mechanisms to bring smart grid into reality. 

9. It’s not just important to have a smart grid. What other factors will contribute to truly having a smart grid?

Smart grids provide energy security because they help a country reduce its dependence on foreign energy supplies. They also protect a country’s economic interests and the environment. To build a truly smart grid, we need a better backbone for the grid and we must also build intelligence into the system end-to-end.

The desired system will require a high-voltage power grid that can serve as its backbone and also efficiently integrate renewable resources into the grid. It will likely cost about $82 billion, or $8 billion per year for 10 years, to achieve the upgrades needed for the high-voltage system serving the U.S.

Making the grid smarter — which will be achieved by replacing traditional analog components with digital ones and incorporating the computing, IT, sensors and other equipment — will have a separate price tag. This will cost about $338 billion to $476 billion over the next 20 years, or about $17 billion to $24 billion annually.

It seems exorbitant, but the investment will pay for itself. These technologies are expected to reduce outage costs by about $49 billion per year and save about $20.4 billion per year from improved energy efficiencies. These technologies will also produce the intangible benefits of increased security, reductions in carbon dioxide emissions, and related environmental improvements.

10. Why is it important for states and localities to build a smart grid infrastructure?

I’ve mentioned the overloaded grid conditions we have today. Yet the situation is certain to get much worse, especially with the increasingly digital society. Twitter alone puts a demand of 2,500 megawatt hours per week on the grid that didn’t exist before. Because of increasing demand, experts believe that the world’s electricity supply will need to triple by 2050.

Localities should build microgrids because these facilities can meet community energy demands in an eco-friendly way that also provides cost advantages to consumers and families. I also believe that local commitments to microgrids will help the country overall by showcasing their capabilities and just proving that it can be done. Cities, communities, and universities are great candidates for microgrids because their microgrid projects can be manageable in size and the local participants are passionate about the opportunity and want their programs to succeed.

Local entities also can use their microgrids to develop and test innovations for consumers, such as smart homes, and the results of these programs can be used in developing other smart grid projects around the country.