Challenges emerge as smart grids shift from planning to full deployment

PricewaterhouseCoopers LLP
Tags: energy management

Smart grid pilot and demonstration programs are under way in 33 states, according to a new report entitled “Smart Grid Growing Pains” from PricewaterhouseCoopers LLP. According to the report, utilities around the country face a number of challenges that need to be properly managed to ensure project costs are contained, cross-industry alliances are functional and customers are engaged.

"We're seeing signs in the utility and power generation industry that suggest regulator and customer interactions and technology and business alliances will rapidly evolve as these massive infrastructure projects are executed. These factors could, in some ways, redefine the way utilities will do business going forward," said David Etheridge, utilities and power generation industry leader at PricewaterhouseCoopers. "Rate cases are on the increase as utilities try to find ways to manage investments and project costs. Utilities are forming alliances with the auto and tech industries, adding several layers of operational complexity. And the biggest question of all is whether customers will embrace or reject smart grid technology."

Six key areas that highlight the growing pains associated with Smart Infrastructure deployment are:

"Utilities will be challenged on many different fronts to get the equation right – from regulators, customers and technology partners to name a few," added Etheridge. "But the potential benefits and savings for both utilities and their customers are significant. Billions are being invested, and there is the possibility of billions in savings - not just in dollars, but also in emissions reductions. The utility industry is at an inflection point in its 100-plus year history – the smart infrastructure is the driving force behind an industry transformation."

At the upcoming CS Week Conference held May 25-28 in Nashville, Tenn., PricewaterhouseCoopers will discuss this report and the growing pains associated with smart grid infrastructure that utilities are experiencing. The session, led by Dennis Curtis, director, and Alan Conkle, principal, of PricewaterhouseCoopers are scheduled for May 27 at 9:15 to 10:15 a.m.

CS Week is an event for professionals involved in the customer service and customer information technology aspects of utility, cooperative and municipal management.

References

(1) The Newton-Evans Research Company, "Global CAPEX and OandM Expenditure Outlook for Electric Power and Investments: 2010-2011 Funding Outlook for smart grid Development", Newton-Evans Research Company press release, Feb, 25, 2010.

(2) "Capital Expenditure Update," SNL Energy, Financial Focus, March 25, 2010.

(3) The Harris Poll of 2,576 adults surveyed in January, 2010, Harris Interactive, Business Wire, March 2, 2010, 2010.

(4) Utilities Global Survey 2009, PricewaterhouseCoopers, 2010.

(5) SNL Energy "Financial Focus" RRA Utility Securities Monthly, 2009 -- Year in Review, January 15, 2010.

(6) SNL, Regulatory Focus: The rate Case Process: A Basic Guide, February 17, 2010.

(7) Cyber Attacks: Is your critical infrastructure safe? PricewaterhouseCoopers, 2010.