Smart grid: where (and how) it fits in the Internet of Things transition


By: SGN Staff


As I mentioned when the series “Silicon, security, the Internet of Things, and the smart grid” was introduced last week, I thought it would be an interesting read because smart grid is often considered the first (and now largest) example of the Internet of Things (IoT). In the introductory article, Kristopher Ardis, executive director of Energy Solutions for Maxim Integrated, discussed the shift from Internet of Things fantasy to reality and its dependence on ROI. In Part 2, he provides insights on the smart grid’s role in that transition. Feel free to share your agreements or disagreements in the Comment form at the bottom of the page. - By Jesse Berst


Kristopher Ardis


In our prior article we talked about how the shift from IoT fantasy to reality is dependent on a return on investment (ROI). Now let’s see how the smart grid fits in the story.


The smart grid provides the strongest example of a current IoT deployment. It uses advanced sensors and gives us better information for controlling our energy world. It also illustrates the challenges and dangers inherent in an IoT.


The story starts with smart meters. For the last several years, U.S. electric utilities have installed solid-state electricity meters that can report data on consumption at nearly real time. Many other countries are deploying smart-meter technologies as well. Smart meters allow consumers to access their consumption data so they can better manage their electricity usage.


For utilities, the ROI on smart meters is difficult to calculate, but some benefits are clear and tangible: lower cost of data collection, since meters report their data automatically; quicker reaction to outages, leading to less lost-revenue downtime; better monitoring of electricity theft; and better ability to link the actual costs of generation with consumption through time-of-use pricing.


The smart grid promises to go far beyond the benefits that smart meters provide. The smart grid also encompasses technologies that monitor transmission lines; manage substations; integrate microgeneration (such as solar or wind) on the grid; and utilize large-scale batteries. These technologies will allow utilities to identify outage problems quicker, delay capital expenses associated with new power plants, and better manage the power before it is even delivered to the customer. The utilities’ ROI in these activities tends to be obvious: more uptime, less capital expenses, and better efficiency. The ROI in solar, wind, and storage technologies is not always as obvious for utilities, but there is mounting political pressure (and regulations) to integrate these technologies. Utilities have little choice but to invest.

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