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Two crucial questions for the smart grid

Who will own the data the industrial Internet generates, and how will users fare under an onslaught of optimization problems?

In a lively panel discussion at last week’s IEEE Industrial Electronics Society meeting in Montreal, two questions related to the smart grid (the prospective electrical distribution system that will set prices dynamically and let consumers sell electricity to other users easily) arose that I think we’ll hear much more about in coming years:

Who will own the data? One important feature of the smart grid will be integration with layers of software at the level of individual machines attached to it — everything from industrial furnaces to home clothes dryers. The idea is that these devices will constantly send data about their usage into a variety of optimization schemes that seek to balance energy usage by adjusting prices and advising power sources on expected demand.

If this data is valuable — and the smart grid’s proponents suggest it is — then someone will find value in capturing it. Who will claim it? Manufacturers might require licenses to decode data from their devices, and data clearinghouses might require that manufacturers license their standards in order to participate. Squabbles over data ownership could delay adoption and hurt systemwide gains.

Industrial users have presumably addressed this question in various ways. Readers who can put their hands on an industrial data usage agreement or two are welcome to send them my way.

Will users be overloaded by decision making? The smart grid promises to balance demand and let flexible users save money through dynamic pricing. Large electricity users already enjoy discounts for electricity at off-peak hours and adjust their work schedules accordingly, but this kind of pricing will soon be available to consumers, and at highly dynamic levels — imagine a display in your laundry room that tells you what it will cost to wash your clothes now and predicts the cost of washing them overnight instead. If the laundry isn’t urgent, the overnight cycle might be an easy choice, but consumers could be besieged by trade offs to which they’re nearly indifferent. Read more…

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