Looking for an alternative to carbon offsets to save the climate and go green? Well look no further, the smart grid has arrived.
Actually, it hasn’t arrived. And it probably won’t arrive for a very long time, although President Barack Obama recently encouraged congress to pass a bill that could see the beginning of the smart grid in as few as three years. But for now, it remains an ideal vision for a far off future.
The smart grid is an electrical grid that uses digital technology to distribute and allocate electricity directly from producers to consumers, based on demand and efficiency. Studies estimate that updating the current U.S. electrical grid to make it only five percent more efficient would be the equivalent of removing 53 million cars from the roads. The United States Energy Department estimates that an updated power grid could result in savings between 43 and 117 billion dollars over the next 20 years, saving that would make even a Republican weak in the knees.

So what’s the hold up? Surely it can’t be cost. The first and only smart grid, currently located in Italy, was produced and executed at a cost of 2.1 billion dollars, but currently delivers savings of 500 million annually. Moreover, the technology used in smart grids has been in play for years, primarily in the manufacturing and telecommunications sector. It seems the only element holding the smart grid back is regulation.
Many of today’s utility companies are reluctant to take a leap of faith and invest in the digitization of the power grid without substantial government incentive. Last Tuesday’s Clean Energy Venture Summit in Austin, Texas, saw many of the energy industries leading executives calling for immediate action. “We’re sitting on an aged, old infrastructure while emerging countries like India and China are moving to the next generation of networks and generation sources,” said Brad Gammons, vice president, IBM global energy and utilities industry group. And in this case, that means subsidies.
The smart grid isn’t perfect. Implementation will require nation-wide cooperation. But I like the smart grid. It’s the best solution to the energy crisis I’ve seen in a long time, certainly better than the practice of carbon offsetting, which simply redistributes CO2 emissions instead of actually reducing them. We live in a digital age – why shouldn’t our electrical grid be digital too?