The Money is in the Smart Grid!

Machine to Machine (M2M) communications has been under development for decades but we are still waiting for its commercial success. Already some 10 years ago, numerous companies were created with the ambition for other industries to leverage commercially from the technical achievements created in the telecom area during the 80- and 90-ties. However, even if some of these companies like e2home, wireless car, etc, exist even today, their commercial success and the impact of M2M communications on our daily life are still to be seen.

The way I see it, the main problem with M2M is that there needs to be business cases associated with the suggested applications; who is ever going to be willing to pay for that the “toaster is be able to communicate with the refrigerator” (quote: Jens Zander).

When it comes to Smart Grid Communications the situation is, however, different. At last, here is an application of communications to an area which has indeed a great need for reliable, real time and trust worthy communication systems. Moreover, the Smart Grid will generate money so there will be a business case that can pay for the development and operation of the communication system as well.

What is then the Smart Grid? The “Smart Grid” has become a buzz word that describes the next-generation electrical power system that is built on the increased use of communications and information technology in the future generation, delivery and consumption of electrical energy.

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The conceptual model of the smart grid is based on seven important domains: Bulk Generation, Transmission, Distribution, Customers, Operations, Markets and Service Providers. The Figure above shows all the communications and energy/electricity flows connecting each domain and how they are interrelated. Each individual domain is itself comprised of important smart grid elements that are connected to each other through two-way communications and energy/electricity paths. These connections are the basis of the future, intelligent and dynamic power electricity grid. (see:

With the advent of the smart grid, there is suddenly an, as yet, unmet demand for people capable of applying digital communications and computing expertise to electricity transmission and distribution. The U.S. government so desperately wants to create a robust power and energy engineering workforce that it has allocated $100 million to that training and education. That money has been distributed to 54 programs in order to train 30,000 engineers!

The Money is in the Smart Grid!

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2 Responses to The Money is in the Smart Grid!

  1. Jens Zander says:

    Good point – in the “smart home” the incentives are not big enough yet – say to conserve energy. With rising energy prices this may well change in the near future. In large scale operations, like the utilities, the savings potential is huge so it is much more likely that someone will make all the investments needed.

  2. Mats Nilsson says:

    Good input, agree to both above. There is a large distance between the wireless gadgets in a home, in many cases cable replacements and the M2M services that requires large covering telecom systems. As I got it from an M2M seminar held last week by Net1, Ericsson, Falbygdens Energi and others, the electrical production and distribution systems are clearly undersupplied in terms of mesurement points/locations and frequency. Low hanging fruit right now for those who are close to business.

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