wondering about the smart grid? (it’s ok, most people aren’t)

wondering about the smart grid? (it’s ok, most people aren’t)

Written By

Natalie Jenkins House

I’m sure that a lot of you have been thinking about the smart grid.

Well okay, unless you work for a utility company, you’re probably not thinking about the smart grid. And you’re not alone. The Smart Grid Consumer Collaborative, a non-profit organization chartered to represent consumer interests in the smart grid, says that 51% of consumers have never heard the term “smart grid.” An additional 21% of consumers have heard the term but don’t know what it means. [1]

So what is the smart grid? And more importantly, why should you care?

Let’s start with “the grid.” The grid is the network that delivers electricity from the power plant to your door. It is made up of transmission lines, substations, transformers, power poles, meters, and more. The “smart grid” refers to a technology upgrade to the power grid—think of it as the equivalent of going from a rotary telephone to an iPhone—that brings our electrical utilities into the 21st century with digital processing, two-way communication, and automation.

Because the grid in the U.S. is over 100 years old and is made up of hundreds of providers across fifty states, the smart grid upgrade is extremely complex. The U.S. government has provided legislative support for this initiative, and utilities, technology providers, consumer electronics manufacturers, and retailers are all involved in an ongoing roll-out that will likely take decades.

Bringing our electrical infrastructure into the modern age is something that most people agree is a good idea. But this initiative has not been without controversy. Namely, there is concern that the smart grid will allow utilities to monitor detailed information on household energy use, which some consider to be an invasion of privacy. There is also concern that with these new technologies in place, utilities may look for ways to remotely limit or otherwise actively manage energy use and prices.

But there are significant benefits to the smart grid roll-out:

  • Smart grid projects will create tens of thousands of jobs and bring an estimated $12 billion to the U.S. economy in the next two years.[2]
  • Many components of our grid are decades old. Replacing them with new technology will help ensure consistent power delivery.
  • Improvements in grid reliability will reduce the possibility of blackouts.
  • Improvement of the entire grid limits the need to invest in new power plants, makes it easier to connect the grid to renewable energy sources, and opens up more flexible rate plans.
  • Smart grid will enable digital communications and open up the possibility for applications built on top of the smart grid to help consumers better monitor and manage their energy use and costs.
  • Real-time matching of supply and demand will reduce fossil-fuel consumption by eliminating the need for energy “reserves.”

There is no single entity—government or private—that leads the smart grid movement. It is frankly, a bit hard to sort through and process all of the information that is out there. But if you’re looking for information on the smart grid, here are some good starting points:


[1] The SmartGrid Consumer Collaborative Consumer Pulse Research, Wave 2, December 2011.

[2] The SmartGrid Consumer Collaborative Consumer Pulse Research, Wave 2, December 2011.