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Remarks Announcing the Development of a Smart Electricity Grid, Jefferson City, Missouri

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AS PREPARED FOR DELIVERY

Thursday, April 16, 2009

CONTACT OFFICE OF PUBLIC AFFAIRS

202-482-4883

Remarks Announcing the Development of a Smart Electricity Grid
ABB Transformer Factory
Jefferson City, Missouri

Good afternoon, everyone. I’m Department of Commerce Secretary Gary Locke. Thank you for having us at ABB, where we’re seeing some of the first signs of what the American Recovery and Reinvestment Act will mean to our nation.

I’m here today to announce an important step in the development of a smart electricity grid, basically an energy grid that employs the Internet’s digital information technology to allow, among other things, homeowners and businesses to decide when and how they use electricity and even sell electricity back to their local utilities.

It can sound complicated, but here’s what it could mean to you: Imagine your plug-in electric vehicle storing electricity at night, when the demand and price is low, and then selling some of this energy back to your utility company during the day, while you are working, when demand and prices are near peak levels.

Imagine your clothes dryer communicating with your local utility so that it turned on when the cost of electricity was lowest, saving you money.

Finally, imagine your electric grid operators receiving instant information on a local blackout and shifting power to the area so that the blackout doesn’t spread and you don’t lose all the food in your fridge.

All that could be a reality with a smart energy grid—a new blueprint for how electricity moves in America with two-way, real-time communication between the user and the grid. It will create jobs, save you money and decrease our dependence on foreign oil, all while reducing the emissions that have put our planet in peril.

But before I talk about the future, I want you to join me in contemplating a little piece of technological history we all take for granted.

This little card, besides occasionally allowing our children to get themselves in expensive trouble, brought a new level of convenience to our lives. Find a machine. Put your card in. Get your money out.

No more running to your bank. No more waiting in line for a teller. No more Friday afternoon math equations to figure out how much money you’ll need for the weekend.

The story behind the ATM card, though, is much more complicated than you’d think. Initially, before a set of standards was agreed to, they could only be used at your own bank. That’s it. But then the banking industry agreed on a wide range of standards—rules to govern ATM security, communications and transactions.

Those rules enabled a revolution in how we live our lives and spurred additional innovation. You can now use your card at any ATM machine and even at the cashier stand at your grocery store.

The birth of a truly connected smart energy grid will be realized when we establish the rules of the road that will let the technology finally lift off.

Here at ABB, you’re already seeing just what the new energy economy could mean to our country. Your company is building the 100 new transformers the Lost Creek wind project needs. That order was made possible because of the Recovery Act’s investment in renewable energy. It enabled Lost Creek’s stalled wind turbine project in St. Joseph to move forward.

A Smart Grid will help create more jobs like the ones here. Once the standards are in place, entrepreneurs, start-ups and existing energy companies will be free to innovate, create new products and get them to the market. And we’ll be able to export their new technology around the world, creating jobs in America while reducing fuel consumption around the globe.

But the benefits of a true smart electricity grid don’t end with jobs. It will minimize or even prevent blackouts by allowing real-time awareness across the many power systems that make up the grid. This intelligence will save money. Consider that blackouts and power quality issues cost Americans $100 billion a year on average. The massive blackout of 2003 alone cost consumers $6 billion.

Finally, the Smart Grid will reduce our dependence on foreign oil, saving us money and slowing the emissions choking our planet. It will enable the use of more local solar, wind and renewable energy sources—right down to solar panels on your house that sell excess electricity back to your local utility.

If our current grid was just 5 percent more efficient, the energy savings would be equivalent to permanently eliminating the fuel and greenhouse gas emissions from 53 million cars.

But again, the future is waiting on rules and common standards.

Congress has charged the National Institute of Standards and Technology (NIST) with primary responsibility to develop standards that will ensure that all this new technology is compatible and that all the systems can talk to one another and make certain that cyber-security standards and other safeguards will be in place to protect the grid from hackers and natural disasters. The Recovery Act is providing more than $10 million to take the next steps.

Today, I want to announce a Smart Grid meeting in Washington, D.C. that I will chair along with Energy Secretary Steven Chu. The event will be held the second week of May at the latest.

This meeting will bring together key stakeholders from the private sector. The event will begin a critical discussion and send a message that Smart Grid is a top priority for the Obama Administration.

Industry leaders at the meeting will be expected to pledge to harmonize industry standards critical in developing the Smart Grid, work expeditiously and constructively to reach a standards agreement, and abide by the standards devised.

The Recovery Act funds a critical down payment on changing the way we use energy, a change that will reduce our dependence on foreign oil, reduce our costs and clean up our environment.

With President Obama and Vice President Biden’s leadership, today we are taking a significant step toward reshaping the energy industry and putting our nation on a path to energy independence.

Thank you.