America’s Smart Grid Dreams Fading Without Congressional Support
Congress hasn’t allocated funding explicitly for the Smart Grid since the Obama stimulus package in 2009, the Congressional Research Service noted this month, and without Congressional support, the grid could develop in slow and piecemeal fashion, with increased risk of incompatible parts.
Richard J. Campbell, an energy-policy specialist for CRS, reports that current funding levels, delivered through Department of Energy programs, state programs and utilities, cannot meet the estimated cost to modernize the grid by 2030.
“Congress could provide funding to help bridge the funding gap if it chooses to accelerate adoption of the Smart Grid,” he writes in an April 10 report to members of Congress. “A number of near-term trends—including electric vehicles, environmental concerns, and the ability of customers to take advantage of real-time pricing programs to reduce consumer cost and energy demand—would benefit from investments in Smart Grid enabled technologies.”
If Congress were to legislate deployment of the Smart Grid, it could cost $338 billion to $476 billion over a 20-year period, according to an Electric Power Research Institute estimate. That investment would result in benefits worth $1.3 to $2 trillion, EPRI estimates.
But if current spending levels continue, the electric industry will invest only about 10 percent of that estimated cost: $46 billion by 2030.
Smart Grid technologies include sensors, controls, and data-management technologies that allow energy providers to optimize interconnected elements of the electric system. They are expected to reduce costs over time by increasing electric system reliability, flexibility, and grid resiliency.
They also empower consumers in the electricity marketplace, support energy storage, and enable more distributed- and renewable-energy generation.
Without federal support for a formal transition to these technologies, Smart Grid elements are being installed by utilities as older components are replaced.
That approach increases the risk of incompatibility between different parts of the grid. In 2007, Congress passed a law directing the National Institute of Standards and Technology (NIST) to develop a set of common standards to ensure interoperability. NIST did so, but the Federal Electricity Regulatory Commission declined to adopt them because of cybersecurity concerns. That sent NIST back to the drawing board, and seven years later, the work appears to be ongoing.
Campbell identifies only two pieces of recent legislation relevant to the Smart Grid. The first, HR 8, would have encouraged labels on products that use Smart Grid technologies. Introduced by Rep. Fred Upton (R-MI), it passed the House in December 2015 but languished in the Senate Committee on Energy and Natural Resources. In the current Congress, Sen. Ron Wyden (D-OR) introduced S. 1874, which would require the DOE to establish demonstration grant programs for Smart Grid technologies. It has been idling in the Senate Committee on Energy and Natural Resources since September.