Smart grid faces major hurdles

US utilities are being driven towards renewable energy and smart grid technologies, but consumers are unwilling to pay for them, according to a report from the utilities group of IT giant Oracle, released on Monday.

The report, entitled Turning Information into Power, surveyed 604 customers and 200 utility managers. Some 95 per cent of energy customers would like more information about their energy consumption, but only one in five is willing to pay for the privilege, it found. The consumers showed a distinct lack of action when compared to their perceived interest in energy conservation.

Three quarters said that they were interested in renewable technologies for the home, but only six per cent had implemented them in the past 12 months. And while 62 per cent said that they would take advantage of net metering if it became available, only 11 per cent of utilities said that their customers actively pursued such programmes.

These concerns were also reflected in the utility suppliers' perceived obstacles to smart grid adoption. Upfront consumer expense was the primary concern, with 42 per cent of utility managers worrying about this issue. Of those surveyed, 29 per cent cited a lack of support from utilities customers, with 28 per cent worrying about current business models. Significantly, 30 per cent were concerned about the lack of consistent industry technology standards.

In addition to the financial and technical barriers, there are also legal hurdles, according to industry experts. Speaking in an interview with Reuters, John Krenicki, head of General Electric's energy infrastructure unit, said that innovative legislation would be necessary to overcome the transmission challenges associated with introducing renewable energy into the grid. The federal government must be given authority to build new transmission infrastructure in the next energy bill, he said.

There are signs that such legislation is already under way. Democratic Senator Harry Reed sponsored a bill in January designed to encourage the modernisation of the grid, as part of a broader movement to reduce US dependence on foreign oil.

Nevertheless, utilities are still ploughing ahead with development. Four in 10 have assessed the opportunity for a smart grid, while half of all respondents to the Oracle survey have moved beyond that stage to written plans, merging network-oriented applications, and pilot programmes.

Only two thirds of utilities were currently preparing to accept renewable energy sources into the grid, said the report. One in 10 was not preparing for this, and a quarter of all utilities did not know whether they were preparing or not.

Perhaps unsurprisingly, 59 per cent of utilities did not have a plug-in hybrid electric vehicle strategy in place. PHEVs are still a relatively nascent technology, and the economic downturn is likely to affect market development. Nevertheless, 27 per cent of utilities had developed a strategy.