The smart grid build-out: How do you pick up the pace?
Regulators need to create more incentives to boost smart grid investments since utilities are struggling with return on investment, according to a report from Accenture and the World Economic Forum. It also wouldn't hurt if consumers knew the perks of smart grids.
Bottom line: The potential of smart grids won't be realized unless they somehow boost customer interaction with their utilities. The World Economic Forum and Accenture assessed 90 pilots and found that utilities are struggling to create business cases for smart grids. The biggest issue is that regulator incentives don't reflect "a low carbon agenda." The report was unveiled at the "summer Davos" forum being held this week in Tianjin, China.
Without the government sticks and carrots utilities are unsure about the risk and reward for smart grids. Meanwhile, consumers aren't so hot on smart grid. Privacy and security are big worries and the benefits are unclear.
There are other issues. Among them:
- Multiple smart grid pricing structures;
- Uncertain future legislation direction;
- Uncertain standards;
- Smart metering projects don't highlight clear benefits.
In some respects, the smart grid conundrum isn't all that surprising. Check out this smart grid definition map from the World Economic Forum and Accenture report:
Good luck explaining that in an elevator pitch to consumers.
But there are benefits:
What needs to happen is that companies and regulators need to create a feedback loop with smart grid pilots for course corrections, learnings and ultimately a framework where all the players are headed in one direction.
Add it up and there's a perception issue with the way smart grids are pitched. Simply put, there are too many grid focused pilots and consumers are left wondering what's in it for them. The report is definitely worth a read.
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This post was originally published on Smartplanet.com