KUHN CAPITAL Sunday, February 25, 2018
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The Energy Internet: Al Gore Does It Again


Here’s a technology with the potential to make a difference in America’s energy consumption. Unlike the ethanol boondoggle, and telling celebrities to stop flying around in private jets, this one will live up to its hype.

It’s the “Smart Grid”, a network that controls and monitors energy generating and consuming devices in real-time -- power plants, washing machines, HVAC systems, lights, factory floors, etc. The powerline itself may be the medium through which the data moves: such systems are already being offered by some utilities as an alternative to phone and cable line Internet access.

While the idea has been around for awhile, the relevant technology is now starting to gain traction and the energy trade press is picking up the scent. See Energy Central’s recent article on the subject.

Many Smart Grid advantages are already obvious: others not imagined today will appear as the free market gets its creative hands on the technology. From the energy producer and retailer’s perspective, the Smart Grid means a comprehensive view of energy demand from the granular, single homeowner all the way to the aggregated, regional trunk line. That sort of data allows for more efficient balancing of power supply and demand, and the potential to take corrective action before system stress. Translation: costs go down, reliability goes up.

From the consumer’s perspective, the Grid means the ability to understand and manage where energy is being burned, down to the individual toaster.

Importantly, the Grid would also permit the emergence of dynamic real-time pricing in a transparent market for energy supply and demand. Beats the heck out of regulators setting prices based on who-knows-what.

For instance, homeowners will have the option to adjust their energy demand as a function of their tolerance for energy prices in the midst of, say, a summer heat wave. Using a home systems computer, calculating this trade-off wouldn’t be complicated: simply chart your course between the energy price you’re willing to pay and the amount of inconvenience you’re willing to accept. Don't like the trade-off? Button up your house and buy more energy efficient devices.

Of course there are a variety of obstacles to this vision. As with any widely distributed technology, ponderous standards bodies must convene to agree upon the relevant communications protocols. And the money spent to enable interaction between energy generators and energy users -- and between energy users and their energy consuming devices -- will be huge.

Last, local politicians and energy industry regulators will throw up roadblocks since the Smart Grid could disrupt their lucrative utility tax franchises and threaten thousands of bureaucrats’ jobs.

But the Smart Grids’ advantages are bigger than these obstacles combined and while it may take decades, you read about it here. Al Gore’s done it again: his Information Superhighway will cover our Carbon Footprints.

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