Smart meters are a "time bomb" for utilities, warns insurance expert

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Quick Take:  As an industry, we've done a lot of thinking about the smart meter cost/benefit equation. But I wonder if we've adequately considered what would happen if smart meters made insurance rates go up? Two recent articles in the Insurance Journal suggest that the insurance industry is waking up to this new concern. – Jesse Berst

 

Cyber attacks on infrastructure have become a major worry for utilities, warns a recent article in the Insurance Journal. Traditionally, energy utilities have kept the grid safe by keeping it separate from the open Internet. But that is rapidly changing as smart meters connect customers to their utilities through the web.

 

Utilities claim customers have little to fear since those meters will use the same security measures as online banking. But “the risk is being underestimated outside of the industry,” said Eberhard Oehler, managing director of German utility Stadtwerke Ettlingen. A recent simulated attack came close to shutting down power to Ettlingen's 40,000 residents. The experiment revealed that "sensitive, critical infrastructure is not sufficiently protected."