Smart grid faces challenges ahead, report finds


David Etheridge,
Utilities Practice
Leader, Price-
New York, NY, U.S.A. — (METERING.COM) — May 28, 2010 – The challenges utilities are encountering in their smart meter and smart grid rollouts could, if not properly managed, potentially hobble or derail these ambitious, multiyear plans, according to a new white paper from PricewaterhouseCoopers LLP.

The paper, “Smart Grid Growing Pains,” says that advanced metering infrastructure (AMI) and smart grid pilot and demonstration programs are under way in at least 33 states, and utilities are installing thousands of smart meters a day. However, while early returns have been promising in some spots, utilities have also experienced some bumps.

Six key areas highlight the growing pains associated with smart infrastructure deployment, according to the report.

One of these is the capital expenditure requirements, with concerns being raised over layering smart grid capital expenditures on top of already expanding capital expenditure budgets. Another is the need to manage closer customer relationships in order to ensure customer adoption and satisfaction.

There is the need to meet the cost-benefit equation, with real, rather than theoretical, benefits flowing from the rollout. Then there is the issue of securing cyber assets, with the need to safeguard against cyber attacks becoming increasingly urgent as smart infrastructures expand.

There is also the quandary of managing and utilizing the volumes of data that will flow and the new data streams. Finally, there is the need to manage new partners and a changed vendor-utility relationship in the smart infrastructure space.

At this juncture, project governance, sound business cases and seamless systems integration are of paramount importance, says the report, pointing out that utilities will increasingly be scrutinized by customers and regulators for smart grid cost overruns.

The report also notes that each utility needs to thoroughly assess whether or not a fast-tracked, widespread deployment of smart grid technology is the best for its region and customers. An all-or-nothing approach simply is not necessary, with future regional smart grids likely to vary as needed from region to region.

“Utilities will be challenged on many different fronts to get the equation right – from regulators, customers and technology partners to name a few,” commented David Etheridge, utilities practice leader at PricewaterhouseCoopers. “But the potential benefits and savings for both utilities and their customers are significant. Billions are being invested, and there is the possibility of billions in savings – not just in dollars, but also in emissions reductions.”

 To read “Smart Grid Growing Pains” click here.