Conceptually, smart grid technology also employs a level of automation that should allow for more active maintenance. For example, if service degrades, electrical grid components like smart meters located in the vicinity of the problem, should alert the utility to the problem so a fix can be issued. Smart grid technology also addresses outstanding security issues. Monitoring systems should be able to identify potential security vulnerabilities and threats before a breach occurs.
Critics voice a challenge. Smart grid critics charge that the current electrical grid is being built on last century's technology while trying to power next-generation applications.
Simply put, the so-called "dumb" electricity distribution system lacks the ability to communicate between individual components necessary to quickly identify and repair problems in a proactive fashion. In the current environment, power companies often are unaware of an outage until a customer phones in the issue, much less whether electricity is being distributed in the most efficient way.
With energy a perennial hot-button issue, governments are encouraging investment in smart grid technology through stimulus plans as a way to improve efficient power distribution and ultimately reduce US dependence on other countries for energy.
These incentives are driving a number of projects around the world, many around the implementation of smart meters that open up a line of communication that spans the route between generation plants to so-called "smart sockets" - the electrical outlet.
Smart grid ventures are being financed in whole or in part by governments in a number of cities and countries to try to incorporate smart meters that recognize energy demand conditions on the network. Smart meters can literally power down devices during peak energy utilization periods. This will not only help with costs but will also support more efficient energy utilization.