Utilities, Tech Industry Face Culture Clash in the Smart Grid

(Washington, DC)  As the nation’s electric infrastructure struggles to get smarter, a culture clash has emerged between the rapid-pace high-tech industry and the very slow-moving utility industry as they both try to inject intelligence into the grid.  Google-backed Silicon Valley-based Silver Spring Networks has experienced this first-hand as it pitches its 21st Century software, networking and platform solutions to utilities.

“We have to work to the biorhythms of our clients,” Eric Dresselhuys, Silver Spring’s EVP of Global Development said today at GridWeek 2012, held here.  “A utility client said ‘we don’t want you to force us into an upgrade more than every seven years.’ It made me realize the chasm we have to cross.”

“This [technology change] is coming at us in a lot of different directions,” Heather Sanders, Director of Smart Grid Technologies and Strategy, California ISO said.  The biggest challenge, Sanders said, is not technological but regulatory, with heavily rate-regulated utilities constrained by state public utility commissions in terms of how easily they can spend capital to upgrade technology.

“It's not clear that there is a regulatory meeting of the minds on how we're going to pay for this,” Dresselhuys said.  Regarding a recent case of regulatory lag in Illinois, “the absolute amount of money we're talking about here is so small, $1.50 per customer per month.  Nothing's happening and it's stunning.

Not all utilities are foregoing technology upgrades pending regulatory approval.  “We're spending money on projects for which we don't have regulatory approval because we have to move forward,” Lee Krevat, Smart Grid Director San Diego Gas & Electric (SDG&E) said.

Indeed, SDG&E is out ahead of the industry’s vendors, asking for more up-to-date technologies than the vendors’ products offer.  “We have things that we want and they don't exist the way we want them,” Krevat said.  It's the utility wanting to move faster than the suppliers.  It's bizarre.


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