Smart grid governance

Smart grid governance (지능형전력망 지배구조/知能型電力網 支配構造, 스마트그리드 거버넌스) is an extended IT (information technology) governance. It's because smart grids combine conventional electrical grids with information and communications technologies.

Smart grid gathers, distributes and supplies electricity on two-way information about the behavior of participants in order to improve the efficiency, reliability and sustainability of electricity services being connected with renewable energy sources and electric cars.

Korea has seen its own smart grid act come into force on November 25, 2011, and test bed being implemented at Jeju Island for years. In Europe, smart grid policy has been organized as Smart Grid European Technology Platform. Policy in the United States is described in 42 U.S.C. ch.152 subch.IX § 17381.

At the moment, at home and abroad, there is no industrial spearhead nor clear-cut picture for the future even though no one is doubtful of a brilliant prospect for smart grid projects.

Key words
smart grid, renewable energy, smart meter, electric car, privacy protection, IT governance

Smart Grid and Privacy Issue
One of the biggest huddle is the privacy issue protected by law.

The Smart Grid Act provides for data protection because smart meters gather and transmit electricity usage information of consumers periodically to the meter data management system for both grid control and billing purposes. Article 22 (Collection, etc. of Personal Information in Smart Grids) of the Act
 * (1) No one shall collect or process smart grid information about an individual which is identifiable with the individual's name, resident registration number, etc. (hereinafter referred to as “personal information in smart grids”) without the consent of the individual (hereinafter referred to as “subject of information”).
 * (2) A subject of information may request a person who holds smart grid information about him/her to inspect, correct or delete the information: Provided, That he/she shall not request the deletion of information about him/her if collecting such information is specifically permitted by any other Act.
 * (3) Upon request under paragraph (2), a person who holds smart grid information shall immediately conduct an investigation thereon to inspect, correct, or delete the information and take other necessary measures and then notify the subject of information of the results thereof.

Article 23 (Provision, Sharing, etc. of Smart Grid Information)
 * (1) If necessary to smoothly provide smart grid services, a smart grid business operator may request another smart grid business operator to provide or share smart grid information.
 * (2) If a person intends to provide or share smart grid information including personal information in smart grids pursuant to paragraph (1), he/she shall notify the subject of information of each of the following to obtain consent thereto:
 * 1. The person who desires to access or share the personal information in smart grids;
 * 2. Purposes of holding or using the personal information in smart grids by the person mentioned in subparagraph (1);
 * 3. duration for which the person mentioned in subparagraph (1) wishes to hold or use the personal information in smart grids;
 * 4. Items of the personal information in smart grids to be provided.
 * (3) A person who accesses or shares smart grid information pursuant to paragraph (1) or (2) shall neither provide the information to a third party nor use the information for any purpose other than that for which the information is provided, unless the subject of information consents to it or any other Act specifically provides otherwise.
 * (4) Unless there is any justifiable cause, a person who receives a request under paragraph (1) shall accept the request for agreement in good faith.
 * (5) If it is impossible to make an agreement under paragraph (4) or the parties fail to reach an agreement, either party may request the Minister of Knowledge Economy to mediate the case, as prescribed by Presidential Decree.

Article 24 (Ensuring Proper Collection and Utilization of Smart Grid Information)
 * (1) The Minister of Knowledge Economy may establish standard terms and conditions for the collection and utilization of smart grid information and may recommend smart grid business operators to implement such terms and conditions.
 * (2) The Minister of Knowledge Economy may recommend smart grid business operators to establish regulations on the following matters and to implement such regulations:
 * 1. The standard process of inspection, correction, or deletion of smart grid information;
 * 2. Other matters for ensuring proper collection and utilization of smart grid information.

So do the electricity charging stands located across the country for electric vehicles.

However, this kind of personal information may expose customer's habits, behaviors, home appliances' category, and even the life pattern information.

That’s why the United Kingdom has revised its ambitious plan to install smart meters at all households, to selective households at their choice.

Reliable solutions
In this connection, reliable solutions should be provided lest privacy issues should outweigh the importance of smart grids.
 * 1) First of all, such data protection provisions on notice and consent should be observed by smart grid participants.
 * 2) The customers’ information on the electricity usage is required to be processed to be anonymous or even encrypted.
 * 3) It is advisable to put the installation of smart meters at ordinary households to the lowest priority until any privacy protection technology is fully developed.

Smart grid governance
Further, smart grid governance, very similar to IT governance, should be implemented in a proper manner.

At first, smart grid governance is to enhance the effectiveness and transparency of electric power supply, distribution and consumption.

Then who is accountable for the operation of smart grid including the afore-mentioned privacy protection? In this connection, the electric power exchange seems to be the most appropriate candidate for smart grid governance.

The reason why KPX is accountable for smart grids in Korea is as follows:
 * Smart grid governance could be well managed by a legal entity in a neutral position.
 * Smart grid governance is usually linked to price-dependent supply, distribution and consumption (collectively trading) of electric power.
 * Any violator of smart grid governance should be expelled from the on-line marketplace for trading of electric power.
 * When any smart grid participant without a license (e.g., a wind generation operator) wishes to sell electricity, it may do so via the smart governance operator. For instance, KPX may nominate the applicant so that it may trade electricity to the extent that the relevant act allows to do so. It may save the red-tapes and lots of paper works at the initial stage of smart grid projects.