The Smart-Grid Dilemma

Market forces are against smart-energy innovations.

I am no expert on smart grids. But like any intelligent person in the world today, I have asked what steps would shepherd us toward smarter energy usage. Smart grids come back as an answer from the innovation angle.

Let’s explore what a world with smart grids would enable.

Today, consumers pay an average price for their energy consumption, irrespective of their usage patterns (peak, non-peak), even though the wholesale price swings wildly. Utilities have to manage distribution and availability to ensure they can cover peak demand. Consumers do not have access to data that reflects their consumption patterns broken down by time of day. Utilities do not have billing systems that can bill based on peak versus non-peak consumption.

The obvious solution that comes to mind is a smart meter, right? Wrong.

What do utilities make money on? Energy consumption. So, what incentive do they have to install smart meters in your house and make this a transparent process with variable pricing if that means it would eventually reduce your energy bill, hence their revenue?

Forbes