Making the case for an Internet-enabled smart grid

A quantum leap for utility business models and operations policy

By Steven Collier, IEEE smart grid expert and Vice President of Marketing and Business Development, Milsoft Utility Solutions

Steven Collier

Today's North American power grid is widely acknowledged to be the most complex system ever built. More than 10,000 generating stations and tens of thousands of substations are connected in a complex network of transmission and distribution lines that deliver electricity to many millions of homes and businesses with remarkably low cost and high reliability.

The grid is, however, showing its age. In a 2009 report, "Keeping the Lights On in a New World" the Electricity Advisory Committee for the U.S. Department of Energy advised that "…the current electric power infrastructure…will be unable to ensure a reliable, cost-effective, secure, and environmentally sustainable supply of electricity for the next two decades…much of the electricity supply and delivery infrastructure is nearing the end of its useful life."

It is clearly time for a quantum leap to a more robust and much smarter grid. But the smart grid we are envisioning will increase grid complexity by at least an order of magnitude. Smart meters are just the beginning. Digital devices of all descriptions – from synchrophasor monitoring power measurement units to tablet computers to household appliances – will be integrated, all contributing potentially useful monitoring and control 24 hours a day, 365 days a year.

The information network capable of handling this digital information blizzard must be ubiquitous, self-healing, and have sufficient speed and capacity to monitor and manage billions of intelligent electronic devices within the grid and inside consumers' homes and businesses.

Fortunately, the Internet already exists. If it did not, we would have to invent it, which apparently is what some utilities believe they must do.

Myth versus reality

Many utility professionals subscribe to a number of myths regarding the use of the Internet for the smart grid. They contend that the Internet is not reliable enough and it won't be available when it is needed most.  They contend it cannot be secure enough and that hackers can penetrate the smart grid through smart meters or the cloud. They contend that it will not be ubiquitous enough to be available at every point at which the utility will need monitoring and control. They contend it will be too expensive and utilities can build their own networks more economically.

The truth is that the Internet is already very nearly ubiquitous and soon will be completely so – especially now that wireless access is commonplace. It is self-healing, which makes it potentially more reliable than the power grid itself. The billions of devices already connected to the Internet are interoperable. This standardization creates a competitive marketplace for products and services that drives performance up and prices down.

What Internet skeptics tend to ignore is the enormous cost and delay of trying to build and operate separate proprietary communications networks that would come remotely close to matching the performance the Internet provides today. An Internet-enabled smart grid will need some customization – primarily in the areas of serving the last mile and maintaining cybersecurity. But those are also inherent challenges of the Internet that all consumers and businesses already want, even demand.

Happily, the Internet-enabled smart grid concept is being recognized by vendors of smart meters, SCADA, and other electric utility product and service suppliers. Most have IP-addressable devices and cloud-based enterprise applications in their technology plans. Some notable utilities like the Chattanooga Electric Power Board have moved entirely toward the Internet as the control plane for their smart grid.

Although their skepticism about Internet technology may not be rooted in reality, there are reasons utilities look elsewhere for the smart grid's control plane. Utilities are accustomed, for example, to owning and controlling all parts of their infrastructure. This perspective has grown out of the obligation to provide reliable power service. Investor-owned utilities, which represent nearly three fourths of the total business, earn a rate of return for their shareholders only on the assets that they own.

It is in utilities' DNA to own and control everything from the generator to the customers' meters, including the communications systems. But just as the smart grid represents a quantum leap in power grid capability, it is also a game changer for utility business models and operations policy.

Cost, fear and security

There's no way around it: Building an optimal smart grid will be expensive. We should not ignore the Electric Advisory Committee's warning that much of the existing electricity supply and delivery infrastructure is nearing the end of its useful life. We don't have the option of rebuilding the grid from scratch. Perhaps utilities could view this as a fortunate coincidence and an opportunity to reconstitute grid monitoring, communications and control with the very best new technologies.

Deploying new technologies involves a level of risk and uncertainty daunting for an industry that has not changed its core technologies very much in a century. The risk of an inadequate electric grid is much more daunting than the risk of learning to use the Internet – which has been field-tested and experience-hardened for more than 25 years.

Other Internet challenges include regulatory requirements, discomfort with new operating schemes and business models, and unwillingness to accept that the conventional approaches to planning, building and operating the grid will not be adequate for the future, especially when today's grid seems to be operating pretty well in comparison to most of the rest of the world.

Internet skeptics may believe that – in the unfamiliar world of cloud computing – cybersecurity is their strongest arguing point. It is true that all Internet and cloud security issues have not been solved – nor will they ever be, given the evolving nature of the Internet. It is also true that the same security threats would confront any smart grid control network and that the Internet/cloud computing option has more minds bent on solutions than a proprietary single-industry network could possibly assemble.

Also keep in mind that the U.S. electric utility industry has a much greater physical security problem than a cyber one. This problem has two aspects:

  1. The power grid is becoming incapable of handling current demands, resulting in an increasing frequency of service outages that can adversely affect many consumers in multiple states for multiple days.
  2. The vast majority of the nation's critical generation, transmission and distribution facilities lack physical protection adequate to repel a determined intruder.

How do we best address both physical and cybersecurity issues? With a smarter grid that enables us to detect, analyze and manage in real time. The cybersecurity risk of an Internet-based smart grid is far outweighed by the greater risk of not having the kind of smart grid that only the Internet can support.


Bob Metcalfe – the founder of 3Com and the "Father of the Ethernet" – predicts that the Internet will become the control plane of the smart grid and says, "Over the past 63 years, we met world needs for cheap and clean information by building the Internet. Over the next 63 years, we will meet world needs for cheap and clean energy by building the Enernet."

The utility industry is embarking upon a long and difficult journey in the 21st century. Not much different, in a way, than the century-long journey which first brought us the power grid that has served us so well, playing a pivotal role in providing unprecedented prosperity.  And the Internet has arrived just in time to ensure that it will continue to do so.

About the Author
Steven Collier is an IEEE smart grid expert whose broad experience includes being a consultant and executive with energy, telecommunications and information technology companies. He is also the Vice President of Marketing and Business Development at Milsoft Utility Solutions.