Should We Force Marriage Between Broadband and Power Cos?

AE_logoWhile broadband service provider networks and utilities’ two-way smart grids belong together, the utilities are acting like a reluctant bride in an arranged marriage. Reasonable adults can see that combining the two is a good idea, but utilities and communications companies are oftentimes miles apart over standards, access and security. As a result, utilities are resisting any forced union that would involve hooking up their meters to customers’ broadband connections rather than a private network.

And that’s a shame, given how combining broadband and utility-provided smart meters could help consumers access web-based applications from Google’s (s goog) PowerMeter to Microsoft’s (s msft) Hohm, and to deliver innovative services such as tweets about home energy consumption. It’s also cheaper to use a home’s broadband than for a utility to build its own network. And data can be displayed to the customer a lot faster, too, because the speed of a normal broadband connection is generally faster than a utility’s private network. It can take as long as 24 hours to display the info back to the consumer on utility networks.

After reading about innovation in Germany where an electric company uses a customer’s broadband connection to help deliver intelligence about power use, I called my local utility, Austin Energy, which is considered an innovator in green energy. I wanted to find out how broadband and utility companies would deliver such services without using the same network, and why Austin Energy isn’t eager for any marriage of networks.

Andres Carvallo, chief information officer at Austin Energy, which in late summer will launch a citywide smart grid that will be able to deliver energy consumption data to subscribers every 50 minutes, says using a customer’s broadband access isn’t going to work. The Austin Energy grid uses a combination of 950 MHz wireless network and a fiber backbone. Part of the problem with using a subscriber’s broadband is that only about 80 percent of Austin Energy customers has broadband access or a broadband subscription, and the utility needs to reach everyone. The other issue is that the utility wants to control the network and information moving to and from the meter.

“The meter is the cash register for the utility,” said Carvallo, “so you have to have a reliable way of managing that cash register, and managing it everywhere — something we’re not able to do over a carrier’s broadband.”

But even if his utility isn’t eager to wed a consumer’s broadband subscription to the utility’s smart meter, he has hope that the two will be joined through other relationships. He sees a future in which a cable company or a security company might charge a consumer an extra $20 a month to monitor and manage home energy usage. Or one in which the utility will work with the Googles and Microsofts of the world to let consumers send their Austin Energy data to providers so they can manage it. Another Texas utility, TXU, provides its own tools for customers to use.

Carvallo thinks that by sharing the information flowing over its network with other providers, Austin Energy can strike a a balance between providing tools to help consumers who want to be engaged in managing their energy consumption, and not overwhelming those who could care less.