Writes Barbara Hollingsworth in the San Francisco Examiner:

Whether the goal is decreasing U.S. dependence on imported oil or reducing greenhouse gas emissions, it can’t be fully realized until the nation’s cobbled-together, decades-old electric grid gets a major makeover that will, to a large extent, determine how Americans live in the 21st century.
Most of the focus so far has been on renewable energy and so-called “smart grid” technology that allows consumers to reduce their demand by monitoring how much electricity they use. Boulder, Colo., is the first fully functioning smart-grid city in the world, with automated substations that reroute electricity around bottlenecks, identify power outages as soon as they happen, flag faulty equipment so it can be fixed or replaced before it conks out and read 16,000 smart grid meters from remote locations.
With $4.5 billion in stimulus funds and another $144 million for state public utility commissions and work force training, smart grid proponents are pushing hard for similar upgrades elsewhere. A report by the National Institute of Standards and Technology predicts that utilities nationwide will invest $40 billion to $50 billion in smart meters within the next five years. Lexington Institute senior fellow Rebecca Grant says that smart grid technology can prevent blackouts and pave the way for increased use of wind and solar energy.
There’s a catch, though. The lower bills consumers have been promised will likely not materialize — even if they’re using less electricity — because most state utility regulations allow power companies to make more money only by selling more electricity. Smart grid technology is designed to reduce consumption, so it will also reduce profits.
Utilities will point to their smart grid improvements to convince government regulators to let them raise rates. Consumers will wind up paying the same amount — or more — for less electricity.
GE Energy Vice President Bog Gilligan recently admitted as much when he noted that “decreasing energy sales would cut into utility profits. Ultimately, policy will be needed to encourage and reward utilities for driving efficiency and conservation.”