The Department of Energy has published a new, very user-friendly introduction to smart grid technologies, benefits, and policies (pdf). I have some quibbles with some of the details, but if you are a newcomer to smart grid (say, for example, if you have heard that this is a primary objective of the incoming Obama administration, but you are not familiar with it), this primer is a good place to start. It includes descriptions of some smart grid projects that demonstrate the possibilities and potential benefits. It’s also got links to a lot of the parties that are working on smart grid technology, interoperability, and policy (including the GridWise Architecture Council, of which I am a member).
Another organization that has been working very deeply in smart grid development is IBM. This Greentech Media article discusses their work, and their indication that 2009 is likely to involve a lot of business and government focus on smart grid and data storage strategies, technologies, policies, and business models.
Smart grid is attractive on a number of levels. For one thing, a substantial amount of the power in the U.S. is wasted. UC Berkeley’s Arun Manjumar recently said that the U.S. consumes 100 quads (or 100 quadrillion BTUs) of energy a year and 50 to 60 quads get lost as waste heat or by other means before it can be used. Smart grid technologies that can help shuttle around power loads over a network conceivably could put a dent in that.
Second, the technology better fits into the VC mold for building companies. Unlike solar or biofuel companies, most smart grid outfits don’t need to build huge factories. They develop software or networking devices for controlling various aspects of power transmission or consumption. …
Third, the grid right now is … uh … pretty dumb. It was made to send electrons in one direction and was not designed for two-way communication.
“Smart grid may be the largest cloud,” said [IBM’s Drew] Clark. “It will be expensive, but that also means it will be lucrative” for companies selling networking gear.
Fourth, because smart grid doesn’t really exist yet, the time exists for startups to set standards and practices.
As alluded to in the DOE document linked above, there are a lot of organizations that are working together to develop a clear, consistent set of industry interoperability standards, to facilitate innovation and commercialization and investment in smart grid.
Note here a topic for further development: Clark’s reference to smart grid as “the largest cloud”. I am at a GridWise Architecture Council meeting right now, and just last night at dinner another Council member and I were talking about the implications of cloud computing for the electricity industry. More on that later.