The introduction of the Smart Energy Collective, a Dutch consortium preparing large-scale Smart Grid implementation in the Netherlands, picked up press through dozens of news agencies, websites, blogs, and the like. It received a lot of feedback, which in turn gave me some insight in the general opinion of Smart Grid. Many comments showed some serious concerns about consumer privacy and autonomy. To concerned citizens, Smart Grids can be seen as a means just to make more money and/or harm the privacy of the end users.

In this regard, electricity grid network operators are similar to Facebook, Google, airlines, and governments: they provide valuable services, but handle immense amounts of private, secure data that could be used to harm individuals’ rights. The awareness of the general public became manifest when privacy concerns of consumer groups prevented the Dutch government from forcing compulsory introduction of the smart meter.

Privacy issues can be dealt with by regulating Smart Grid data collection and data use. In the US, NIST published a set of guidelines for safeguarding the privacy of consumers connected to a Smart Grid. I am sure these guidelines will help protect individuals’ privacy when followed. As stated in a previous Sherpa blog—Privacy by design?—it seems as though privacy by design could form a good protective measure.

But how about short-circuiting the whole privacy and autonomy issue? The Smart Grid is the means to balance power demand with increasingly inflexible supply. Maybe this goal can be reached in another way. Why not move away from micromanaging the households’ energy demands and offer simple electricity contracts with peak and off-peak tariffs? I know it is old-fashioned, but, with suitable price difference, it can have a large impact on household electricity demand. It has some benefits:

• The con/prosumer is in control of his own energy demand (and supply) pattern.
• Data privacy issues can be averted.
• It does not require big data.
• It gives very clear peak-shaving benefits to the network operator and the electricity supplier.

Of course, the plain old dual tariff does not accommodate the fluctuations of solar power and wind power on a fifteen minute timescale, but it does have the potential to have a huge peak-shaving effect on electricity demand, which is very useful for both the electricity supplier and the distribution network operator. What is your opinion on this idea?

By: Luuk Buit, specialist, Renewable Energy Systems and Smart Grids, DNV KEMA Energy & Sustainability