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Regulatory policy to be challenged by smart grid technologies

SUBNET Solutions Inc | Thursday, August 02, 2012

The power of regulatory commissions in states all over the country is growing, and in turn increasing their influence on all privately owned electric and telecommunications companies. For example, the National Association of Regulatory Utility Commissioners (NARUC) has formed to organize meetings that will help state bodies develop public policies and exchange best practices. Such meetings will be crucial as smart grid technologies continue to develop, which will present unique challenges depending on the age of the electric infrastructure, the economic environment and several other factors, according to The Energy Collective.

As more smart grid technologies hit the power grid, and innovative programs and business models are developed, it will create a challenging environment for regulators. One of the hardest challenges will be developing policies for the interoperability of all components found on the smart grid. Since this connectivity has typically been created for bulk power, which occurs only at the transmission level, interoperability on the distribution side of the industry has been significantly underexplored, the media outlet stated.

When it comes to developing these policies, says smart grid consultant Christine Hertzog, it will be important to look to previous smart grid deployments and the policies that were in place at the time.

"Business sectors like telecom and computing both evolved from extremely centralized models to decentralized and distributed models," she wrote. "New technologies triggered new business models and new markets.  How different would our world work today if laws had been enacted to protect mainframe computers from upstart technologies like PCs?"

According to Hertzog, it will be important for regulators to watch the trends in computing and communication, which have evolved from centralized to decentralized, and from "consolidated intelligence to distributed intelligence."

With the advent of smart grid technologies, electricity generation could potentially be seen as a cloud-based resource, as long as the correct policies are in place to expedite the entire grid modernization process.

With more intelligent electronic devices being installed within various communication platforms, utilities will need to ensure reliability and security. SUBNET products help companies collect, manage and analyze data taken from these devices, while adhering to strict NERC CIP security standards.

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