Customer privacy issues far from resolved

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Privacy is one of the hottest and most controversial topics facing the technology industry. Facebook, Google, phone apps and basic web browsing all gather information about consumer usage habits and trends. These same issues have cropped up as side effects of the smart grid's immense data influx, and utility customers are understandably weary about who is using their data -- and how.

Privacy is one of the hottest and most controversial topics facing the technology industry.

Much like Amazon can remember what products customers buy and when, smart meter data can, for example, provide information about which appliances customers use in their home, and whether they are home or not.

Comforting customer privacy issues

Utilities realize that, for whatever reason, these capabilities have the potential to make customers uneasy. In response, they are developing standards and regulations for keeping customer data safe. It's a paramount concern, and that there are many risks that come into play without proper precautions.

"When users understand you are doing something for them, that you are serving them, that you are doing something useful, they are much more comfortable with data being used," said Jules Polonetsky, Director and Co-chair of the Future of Privacy Forum, during a webinar on energy security. "If they think you are doing something to them -- for you -- by knowing more information about them, then their radar is up and they are very ready to object."

So it's largely the same old story for utilities: Communicate benefits of smart grid data with your customer base. But aside from communication, government agencies, regulators, and third parties are all working to develop new best practices for maintaining the privacy of customer information and grid data at large. In fact, the smart grid security market is projected to grow into a $14 billion market by 2018, according to recent data from Pike Research.

The Future of Privacy Forum is one organization at the fore of the smart grid privacy issue, with an eye toward fostering customer trust. In partnership with data privacy management company TRUSTe, the group this month unveiled a "privacy seal" program, targeted at companies that deal with energy usage information. It was developed with input from utilities, communications companies, the Edison Electric Institute and the GridWise Alliance. The seal covers data collected directly from consumers by smart devices, including meters and smart appliances, as well as data provided to or collected by third parties.

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The smart grid security market is projected to grow into a $14 billion market by 2018, according to recent data from Pike Research. ______________________________

"The development of the Smart Grid Seal Program is a visible demonstration of what can be achieved when stakeholders work in concert to develop privacy best practices," wrote David Hoffman, Director of Security Policy and a global privacy officer at Intel, in a reaction to the new initiative.

A common privacy solution?

These examples may not be official policy or regulation, but these organizations are undoubtedly filling a gap, especially with a lack of legislative action. The Obama Administration has proposed Consumer Privacy Bill of Rights, but nothing is final. And a larger-scale cyber security bill that would protect critical infrastructure remains stalled in the U.S. House and Senate.

Progress, however, is being made outside the gridlocked Congress. The California Public Utilities Commission in 2011 announced sweeping privacy requirements of its electric utilities and expanded it to include gas utilities this summer. Further, U.S. energy agencies are working to develop best practices, including NIST, FERC and the Department of Energy, which has put together a Federal Smart Grid Task Force.

"We're optimistic that data use in this area and others can be used for new services, for innovations to solve problems, but also recognize that we might have to jump through some hoops to make it done right," Polonetsky said.