Introduction to the Smart Grid, Pt. 2

 What are the barriers to implementation? 

As with any other large-scale and highly disruptive, proposed change, smart grids have faced opposition throughout the nation.  Challengers to the technology have cited a number of issues—in general, relatively valid issues—to back up their claims that the movement toward a smart grid society may produce more risks and burdens than opportunities and wins.  Some fear threats to privacy in light of the enhanced data collection that accompanies the smart grid.  Others don’t see the value in investing in an infrastructure that is already fairly reliable today (i.e. “If it ain’t broke, don’t fix it”).  By recognizing barriers such as these, we can better shape strategies that will enable easier adoption of smart grid technologies.

Informational Barriers

One of the largest obstacles to smart grid acceptance and investment is how little people know about it.  This lack of information dissemination is damaging to adoption prospects, as people are therefore more susceptible to the influence of groups hell-bent on preventing this technology from taking off.  Simple familiarity with the physical safety of smart metering would easily overturn one of the group’s more potent arguments—that these meters may have detrimental health effects.  Additionally, a better understanding of how dynamic pricing schemes work would allow customers to recognize that they actually have greater flexibility with how and when they choose to consume electricity.  Investment in educational marketing and demonstration programs could help alleviate this particular matter.

Regulatory Barriers

Many opponents to smart grid cite cybersecurity as one of their primary concerns.  On both the individual and the network level, the technology must be properly safeguarded against malicious attacks.  Otherwise, personal information (including data profiling patterns of behavior or occupancy) and system reliability may be at risk.  To address these concerns, nations considering smart grid must establish policies targeting information protection and interoperability protocols, standards, and best practices to safeguard the grid against outside attacks.

Financial and Market Barriers

Because smart grid incorporates information technology throughout the whole power distribution infrastructure, the up-front costs of implementation are quite high.  Despite a quick favorable payback period, overcoming the hurdle of securing initial funding can be difficult.  In developing countries, especially, the smart grid’s demanding early investment may be prohibitively expensive.

Additionally, should the smart grid be adopted, there is a disparity between who pays the costs of the new infrastructure and who sees the benefits.  Currently, the costs are spread out among only select members of the supply chain: utilities, regulators, and the consumers themselves.  However, all members of the value chain see the financial benefits realized through the use of a smart grid.  This means that generators, who do not pay any extra for the grid upgrade, still get a piece of the pie.  This particular obstacle is impeding potential widespread use of smart grid technologies, and it may be resolved through government regulation that fairly distributes the costs and benefits.

Benefits of Implementation

The smart grid brings with it some very obvious benefits—namely, a potentially significant decrease in worldwide CO2 emissions.  The following table outlines estimates of smart grid-enabled mitigation potential, as determined by several different research organizations:

SG Abatement Potential

More nuanced benefits include quicker recovery from power outages (or in some cases, an improved ability to prevent them altogether), cost-savings for customers, and easier renewable/EV integration.  Additionally, despite concerns surrounding the cybersecurity of a smart grid, the system has the potential to be more robust and less susceptible to large-scale outages due to its decentralized nature. With so many outage detection devices online, and with so many available pathways for electricity transmission, a line failure can be mitigated before it cascades into a large blackout.


Overall, the smart grid not only provides a great opportunity for counties to realize significant emissions reductions, it also offers up a host of other benefits.  If nations can navigate the barriers mentioned above, then an investment in a broadly implemented smart grid infrastructure will lay the groundwork for a more efficient, economically beneficial electricity generation, transmission, and distribution system.

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