The Washington Post

As smart-grid funding winds down, energy leaders assess progress

WASHINGTON, DC. FEB.19,2014. Ernest Moniz, Department of Energy secretary, giving the keynote address for a 3-day conference on smart grid technology at the Grand Hyatt Washington Hotel in Washington, D.C. (Jeffrey MacMillan/The Washington Post)

When an Arlington-based organization of power suppliers won a $33.9 million federal grant to modernize the electrical grid, its chief scientist, Craig Miller, expected customers to resist having “smart” energy meters installed at their homes. The meters were designed to provide more data about energy consumption in real time, alerting utilities sooner of power outages, but they might also arouse concerns about data privacy and radiation, he thought.

Miller, who works for the National Rural Electric Cooperative Association, found much less opposition than he expected. Among co-ops the association surveyed, about 70 percent had expected customers to express concern about the meters before they were installed, but only 6 percent cited customer resistance as a barrier afterwards.

“We found minor issues everywhere,” Miller said, but “the only major resistance we saw was in Kauai,” a Hawaiian island whose residents had initially protested the expansion of the smart grid.

Miller and other industry leaders convened in Washington last week at a conference organized by the Institute of Electrical and Electronics Engineers, a national trade group, to discuss challenges to expanding the smart grid. As the Energy Department winds down its smart-grid investment program — supported mainly by a $3.4 billion award from the American Recovery and Reinvestment Act — the department is beginning to assess what progress the nation has made since 2009.

Although consumer resistance is small, it should not be ignored, Anne Hoskins, commissioner of the Maryland Public Service Commission, said during a panel discussion — especially as concerns about data privacy grow.

“As we focus on all technology development, we need to find a way to have customers understand the value of this, because a lot of investment is required,” she said.

Miller said he was surprised to find that a much bigger barrier to smart-grid adoption was a lack of standards allowing devices connected to the grid, such as meters and energy-distribution systems, to communicate with one another. Although a few of these coding systems exist, they are not yet harmonized with each other, and utility companies are hesitant to join the smart grid as a result, Miller said in an interview. Connecting an energy-management system to a data-management system could cost a utility company tens of thousands of dollars, and few want to back the wrong technology standard.

“Where the standards are lacking is absolutely a barrier to the adoption of new technology, because standards make things interoperable,” he said.

Steve Widergren, principal engineer with the Energy Department’s Pacific Northwest National Laboratory, oversaw a $178 million grant to connect 60,000 smart-metered customers in five states to test a system in which customers would pay based on the overall demand for energy at any one time. Prices would go up at peak times and fall at other times, for example at night.

He noted that a lack of standards discouraged utility companies from joining systems such as this, which could involve thousands of devices monitoring and regulating energy usage.

Global investment in the smart grid reached $14.9 billion last year, up from $14.2 billion in 2012, according to research from Bloomberg New Energy Finance. In the United States, most funding — $4.05 billion — has gone toward smart metering, according to the Energy Department. Almost $2 billion has gone to develop more efficient electricity distribution, such as managing energy supplies during outages. Customer systems such as home displays of energy meters have received about $1.28 billion in funding, and the transmission of energy has received about $620 million.

The Energy Department has awarded grants to 99 projects related to the smart grid, Energy Secretary Ernest Moniz said during the conference’s keynote address. Including a private-sector matching program, these projects received about $7.9 billion.



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