Our electrical system consists of power-producing plants (coal, natural gas, oil, solar, wind, nuclear and hydro) and consumers of electricity (houses, schools, commercial buildings and industrial plants).
The producing plants generate electricity based upon anticipated demand, always ensuring that they produce more than the expected need.
In the traditional grid, we simply produce power at power generators and consume it at customers’ locations. We measure how much electricity is used by each customer and that’s the extent of our data collection.
Smart grids allow for information to be generated at the customers’ locations (such as current usage, historical consumption by day of the week, day of the month, month of the year, etc). This information allows us to alter electricity production based on immediate changes (as well as more detailed forecasting) to react to demands more effectively.
In addition to improved information from other sources on the grid, a smart grid allows us to add more and more energy production points. These could include individual customers choosing to use solar or wind generation and industrial sites using excess heat from their processes to generate electricity.
Use of a smart grid will better enable producers to provide power to customers in an open market, and give power generating options directly to customers.
The risks associated with smart grids boil down to the same issues we face with all computer systems: security and stability.
With a traditional grid, so long as the power plant is working and the power lines and infrastructure are physically intact, the users have power. Adding computers to the system might mean that the power could be disabled due to a computer system interruption.
The benefits are enormous, so they’re certainly worth the risk. However, those risks need to be managed. For example, we need to ensure that any computer systems that are tied to the smart grid, whether at a customer’s location or a power generating point, meet certain security requirements and be easily updated to protect against future security flaws. Due to the interconnected nature of the smart grid, any point of entry (a small producing station, for instance) could impact the entire grid.
Therefore, we should have the ability to quickly isolate and remove any producing station from the grid to protect the integrity of the entire grid. This means having the ability to physically severe a connection to any power station or group of customers, removing their connection to the power grid as well as removing their computer systems from the communication network where the rest of the points are communicating.
The ability to quarantine any specific point will be critical to reacting if there’s a system failure or a cyber attack on the grid.
We must also ensure that government officials and bureaucrats have sufficient knowledge of the smart grid before trying to impose regulations that could compromise the security and efficiency of such a system.
With the spread of smart grids, we can liberate customers from an outdated business model and allow free enterprise to provide options and services.
Brosnan Eamonn is a research associate with Frontier Centre for Public Policy.