Pike Research Blog

We hacked the smart meter! Tell the world!

Bob Lockhart — August 31, 2010

Why are we all so excited about the Smart Grids anyway? Potential. Smart Grids hold potential to save consumers money on their energy bill. To save utilities capital expenditure for new generation. To guarantee energy independence for our nation – for your nation, wherever you are. To do more with less energy. Some believe that Smart Grids will save the earth. There is just so much potential!

Bear Bryant once said, “Potential means you ain’t done it yet.” Others heard him say, “Potential is what gets you fired.”

Where is that more true than Smart Grids? We certainly ain’t done it yet and several jobs – and political careers – are being risked in its name. So it may be worth a diversion from our day-to-day worries to consider what could prevent our realizing Smart Grids’ potential.

Here’s one possibility: Fear. And who’s afraid? Ratepayers. Ratepayers that elect politicians.

Anything that sows fear into the hearts of ratepayers – consumers – can make its way back to elected representatives. Those politicians, wishing to remain in office, will oblige their constituents and work to retard Smart Grid deployment. We know that this can happen. Already we have seen several Smart Grid deployments stalled by the outcry over increased energy bills.

Now consider another fear: terrorism. The press reports regularly that smart meters have been hacked. Perhaps the first major story was when a well-known security research firm showed us in 2009 that a smart meter could be successfully hacked.

But they didn’t really show us that a smart meter could be hacked. We already knew that. That any IT device can be hacked is a given – it’s part of our daily lives. Their research showed us how. Full credit for that – it’s valuable research that can only lead to better security. Better security because the threats are better understood, and better security because some meter manufacturers are blasted out of their complacency. That’s okay. This is extremely important work that needs to be done.

What’s not okay is going on national television with a sensational story that smart meters have been hacked. Of course they have. If you have sold 100,000 units of hardware or software and it has not been hacked, there are two plausible explanations:

• It cannot be hacked because it doesn’t do anything

• It actually has been hacked but you haven’t discovered the hack

So what is it to go on TV and tell an uninformed public that doesn’t understand IT that their electric meters can be hacked? How about sensationalism? Or sowing fear? Is all this negative publicity for smart metering bad? Yes.

The public already fears smart meters, after stories in several states of electricity bills suddenly doubling when smart meters were installed. The explanations often turn out to be pedestrian: “Your electricity bill doubled because your old meter was rusted out and not accurately recording your consumption.” But no matter the explanation, mainstream media have been quick to pick up on the thread: Computer geeks botch another technology roll-out; don’t understand the real world, etc.

For sure there have been errors in smart metering roll-outs. Regardless, consumers fear smart meters, and the media seem content to stoke those fears. So what is the need to layer fear of terrorism on top of that? The typical consumer has no idea what a cyber-attack is, let alone whether a worm is more likely to propagate in an RF mesh, an RF star, a PLC network, or none of the above.

What if instead we considered that we are still in the deployment phase – admit that there will be problems, find them through sometimes brilliant research, and then fix them? That’s not to say that we should cover up any bad news. Where there are problems they must be aggressively communicated to the right people and quickly remedied. But telling the general public that as an industry we haven’t got our act together – that only sows more fear in consumers’ hearts. Who will then write their elected representatives, and repeat the cycle we’ve already seen once with billing issues. So why not go easy on the sensational stories for a while?

Sad to say about the Cyber Security world: we’ve chosen a profession where the true heroes are anonymous.

2 Responses to “We hacked the smart meter! Tell the world!”

  1. Gene Haynes says:

    This article shows disconnect with reasons for consumer fear. Nobody fears a geek.

    1) Ratepayers and taxpayers are paying for a smart meter imported from China that displaces local workers, at a time when consumers are worried about imports and job loss.

    2) The cost of smart meter is $500. That much is revealed. The future cost for smart grid is probably another $1500 per customer. That cost is not revealed. The public senses this. They just got burned by deceptive mortgages and deceptive medical insurance practices and homeowner insurance policies that don’t cover what they need insurance for. What mood do utilities think customers are in?

    3) The promise of lower bills ‘in the future’ is not true. Electric companies are going to use the meter to cut power and/or raise rates on each individual based on their meter, which comes with software not of their choosing. There is no plan for increased electric production. What do customers think about this?

    4) People know power to rich people will never be cut, and they know cuts will fall heaviest on the most vulnerable, and they know their job is dependent on electricity, which will put them at greater disadvantage to the wealthy. These are the same rich people who are telling other people they are not being competitive enough.

    5) Ordinary folks are buying a huge gift for electric company investors by accepting ‘dynamic pricing’ [higher rates] and reduced company payrolls. And this is happening when consumers are worried about job layoffs, yet utilities appear baffled by customer reaction, which reinforces negative opinions about utilities.

    6) Absolutely no customer wants to deal with a power company website to get information about their consumption. Nobody wants to sign in and negotiate against game software that knows who they are, and knows their consumption pattern, the same pattern that determines their rates. It boggles the mind that CEOs have not anticipated impending outrage over this part of the plan.

    7) Smart meter ‘savings’ is based on competition against the other guy … especially the rich guy … yet electric companies are selling smart meter as a ‘partnership’ between customer and utility. How can utility CEOs not grasp that there is no desire for partnership?

    8) The offer of meters that ‘meet your budget’ rankles people because it tells them some people are going to have no power. And as power disappears, so will the value of property. People know this underscores the falling value of real estate.

    9) People intensely dislike tracking and intrusion. Yet the premise of smart-meter is tracking and intrusion … but worse, tracking by a company that is not forthright about costs, and shows contempt for consumer sensitivities.

    10) Utilities want to move into a bold new world, but not one single thing squares with what consumers want. And the promise of ‘lower prices’ attainable to the clever and vigilant is simply NOT ‘good economic news.’

    11) People understand the switch to their power will flee overseas in fear of their vote.

    12) This article speaks as if people’s vote is something to be reviled. How do you think people react to that bullying, when utilities can’t answer any issue in this list?

    Smart-grid is going to fail unless questions are answered, quickly. The biggest risk is future rejection after smart meters are installed. And down deep, that’s the catch-22 that worries people most.

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