Economics or Politics? Moving Forward with Smart Grid

As debates and negotiations over the debt ceiling have been consuming congressional leaders, policymakers’ minds are probably far from Smart Grid and the future of our energy systems -- at least right now. But, for the electricity industry, the ways in which the economics of Smart Grid contribute to our long-term energy security and independence — well, that should be at the top of their collective consciousness.

As national energy policy is slow to move, how will future economic, environmental, and local policy drivers impact how Smart Grid evolves?

Will Smart Grid communities that are driven by individuals, neighborhoods, and municipalities emerge? As gas and electricity prices continue to rise, individuals and municipalities will likely start taking matters into their own hands — and without knowing it, begin building a smarter grid at the grassroots level. Adoption of cost-effective EVs will likely pick up, people will find the independence of at-home generation -- like solar panels -- more desirable, and consumers may consider back-up storage to help their homes be more autonomous in the event of an emergency. But, what happens when individuals begin trading power (which is actually illegal in some states) and when communities consider decentralized energy markets? Where does the utility play into this scenario, and how does the system evolve so everyone benefits?

Will the global focus on carbon reduction impact how we do business? Unfortunately, this topic is currently as much a political question as an environmental one. Carbon-reduction efforts undertaken to mitigate climate change — whether at a government or individual level — will certainly impact how utilities and manufacturers do business. The big question prevails: how do businesses make sound and strategic decisions as uncertainty looms, particularly on the policy front? In this case, the economics of Smart Grid are clearly tied to the politics.
Will policy innovation happen at the state level? With uncertainty at the top levels of government, will state governments take energy and Smart Grid policy matters and legislation into their own hands? We’re already seeing states adopt individual renewable portfolio standards and energy efficiency guidelines. If this trend continues, how does this impact different parts of the electricity supply chain — particularly those doing business across state lines?

While Washington DC may be slow to move on national energy policy, DC will be host to another gathering of minds — Smart Grid minds -- at the fifth annual GridWeek this September, where these topics and others related to the way forward for Smart Grid will be discussed. Don’t miss your chance to meet with the industry’s energy leaders to help plan Smart Grid’s future, with the best interest of our nation at the forefro

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Anto Budiardjo is President and CEO of Clasma Events, a global event company specializing in conferences at the center of the worldwide energy discussion. Focusing on Smart Grid, connectivity, and the new energy economy, Clasma’s major events include: ConnectivityWeek, GridWeek, and Grid-Interop. Anto can be reached at Anto@Clasma.com. Follow him on Twitter @AntoBud.