To unlock the potential of a smart grid, we can choose from a multitude of hardware, software, and telecommunications tools. These technologies range from complex sensors that yield new and unique data and are woven into all aspects of the grid, to elegant user interfaces that give operators and consumers alike simple tools for making better decisions.

Specifically, a smart grid will:

• Reduce peak demand by actively managing consumer demand: The percentage of available appliances and equipment that can respond to both consumer and utility operator priorities continues to grow. The ability to manage power requirements in both directions—to the utility as well as from the utility—will reduce the need for power, especially during high-use periods like hot summer afternoons when the cost of producing and delivering power is extremely high.
• Balance consumer reliability and power quality needs: Although some uses of electricity require near perfect reliability and quality, others are almost insensitive to these needs. A smart grid will be able to distinguish the difference and adjust power reliability and quality accordingly at an appropriate cost.
• Mine energy efficiency opportunities proactively: A smart grid will furnish consumers and utilities with accurate, timely, and detailed information about energy use. Armed with this information, we can identify ways to reduce energy consumption with no impact on our safety, comfort, and security. We’ll all gain a new level of understanding and insight into how our energy use affects our environment, along with the national economy and our own pocketbooks.
• Improve overall operational efficiency: A smart grid will become increasingly automated, and smart sensors and controls will be integral to its design and operation. Utility operators will be able to easily identify, diagnose, and correct problems, and will even have the capabilities to anticipate problems before they happen.
• Seamlessly integrate all clean energy technologies: Electric vehicles, roof-top solar systems, wind farms, and storage devices will become a fundamental part of the grid. These clean energy technologies will generate not only energy and power, but serve many other vital functions as well. Although transparent to consumers and utilities, these technologies will bring vast value to society and our economy, and go a long way toward meeting our nation’s short- and long-term goals.