The smart grid might not have been the revolution many predicted, but it is happening — gradually.
“Before the New Energy Economy can take off, consumers must get on board. It’s coming — but the process will be a methodical and collaborative one,” writes energy columnist Ken Silverstein in EnergyBiz.
Utilities are deploying pieces of the smart grid in fits and starts, but some pioneers still feel the arrows in their backs. “We’ve seen the effects of the hype around the smart grid and early technology adopters who touted the consumer benefits of an intelligent grid … and, frankly, the promised benefits haven’t been realized,” LeRoy Nosbaum, chief executive of smart meter maker Itron, told Silverstein.
That’s not to say those benefits aren’t real, Nosbaum clarified. The smart grid just isn’t mature enough for most consumers to see them. Until homeowners and businesses feel more in control over energy use and see costs declining, they’ll will resist paying up front to invest in a smart grid.
What else has been holding up the smart grid revolution? Austerity measures are no help. Utilities face skeptical regulators and soft revenues. Stimulus funds have been responsible for $4.5 billion of the investments in smart grid projects across the United States since the recession began in 2007.
Contests over technology standards are another factor giving conservative utilities pause. You might think that, after a decade, this stuff would be worked out, but it isn’t. Communications protocols are a particularly heated battleground. How should smart meters send their data to the utility?
“Until yesterday, every major supplier favored a single communications technology,” wrote analyst Jesse Berst in Smart Grid News. All have their strengths and weaknesses; none is a clear winner. Utilities would rather hitch their chariots to the right horse, as they consider deploying millions of expensive meters with a long service life. So they wait.
Itron, for example, bet on a “mesh” of radio transceivers embedded in meters or on poles. SmartSynch, on the other hand, is a proponent of using cellular wireless networks. Mesh radio is reliable because of built-in redundancy, but a utility has to build their network. Cellular is already built, but many fear the carriers — who after 30 years still can’t deliver clear voice calls or mid-speed data everywhere — aren’t up to the mission-critical task of meter reading.
Yesterday Itron bought SmartSynch. Silver Spring Networks is said to be similarly moving toward cellular. Offering both protocols allows utilities to choose one vendor but mix and match technologies. With the acquisition, Itron “becomes the first vendor that can say to utility customers, ‘you can have it your way,’” Berst said.
Will the Burger King strategy get utilities off the dime and into the smart grid? That will ultimately depend on the people paying for it.
About eight out of ten consumers consider smart grid benefits to be important, writes Patty Durand, executive director of the Smart Grid Consumer Collaborative. “Yet, not every benefit was important enough to justify adding $3-$4 on monthly electric bills. When considering extra costs, far fewer (20%-30%) consumers rated that the benefits were important enough to help justify paying.”
In other words, until consumers understand smart grid benefits, they’ll go on asking, “Where’s the beef?”