Modernizing America's electric grid has been a priority for the Obama administration since taking office in 2009. As part of its Recovery Act, the federal government dispersed $4.5 billion to the development a smart grid which can handle two-way energy flow as well as synchronize intermittent energy with baseload power.
Today, the government announced that more than five million smart meters have been installed since 2009. Alongside this achievement, the administration announced a host of new programs and initiatives [pdf] to develop what Energy Secretary Steven Chu calls a "21st century electric grid."
The new programs are highlighted by $250 million in loans for smart-grid technology deployment. This money will be allocated to projects which focus on upgrading the electric grid in rural areas.
A key ingredient to the smart grid is increasing energy efficiency. So, the government has announced a host commitments to improve consumers' access to their energy information. Grid 21 is a private sector initiative that will promote consumer-friendly innovations, while maintaining individual privacy.
As part of today's announcement, Secretary Chu took time to explain that the development of a smart grid is another area where the United States is falling behind China and other areas of the world. "Today, China has the highest voltage and capacity transmission lines. Ireland and Spain have a grid system that efficiently integrates large percentages of wind onto the power grid. We can't let the rest of the world pass us by."
The Edison Electric Institute, the industry association for shareholder-owned electric companies, states that utilities are planning to double their investment in smart grid technology. According to EEI, utilities invested $58 billion in the nation's electric grid between 2000 and 2008. Between 2009 and 2013, utilities expect to spend $54 billion. A recent study conducted by the Brattle Group says that in order to modernize the grid, roughly $240 billion to $320 billion will have to be invested into the electric transmission system over the next 20 years.
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