When Italian engineers conceived a rail line between Bologna and Florence in 1845, the greatest engineering feat of its day, the rise of the Apennine mountains was so steep it was impractical for steam engines to traverse it.
A similar conundrum confronts the builders of Australia's national broadband network and the utilities deploying smart grids to smooth electricity use, who must install infrastructure before all the pieces are available.
Telecommunications analyst Paul Budde says the Australian electricity market is set for a "massive transformation" over the next 20 years as the lobotomised mess of pipes and wires that power our homes and offices is infused with IQ.
The 'dumb' power grid is set to get smart but a near-fatal collision with electricity meters that couldn't connect to open networks based on the lingua franca of the internet nearly derailed the project, he says.
"The grid is one of the few infrastructure elements that's still not digitised - it's a network dating back 100 years," Budde says.
"If our friends Thomas Edison and [Alexander] Graham Bell came back to Earth, then Bell would not recognise his telecommunications network but Edison would totally recognise his electricity network.
"The policy for the past 50 years was the cheapest possible energy. That is only changing now - the regulator accepts this is about saving energy by the fact you don't have any leakage or that you can find out where it's leaking: [which means] less outage, less disruption, monitor developments in the house and manage efficiency.
"By having smart grids you have intelligence in the network that's used by utility and user."
Budde praises Victoria for leading the way with smart grids and internet-protocol smart meters. In April, utilities UED and Jemena selected US smart grid networking company Silver Spring Networks to roll out smart meters over four years from September to 1.2 million houses following an earlier announcement by the State Government of its smart grid plan. Citipower and Powercor joined the plan last month.
The rollout will give nearly 3 million Victorians the ability to monitor their energy use and allow utilities to read, connect or disconnect meters remotely and respond faster to power outages.
Budde expects electricity users will leap on board with smart grid energy-conservation plans that could cut usage by a third. And he says many ventures and businesses will steam ahead once the first internet protocol smart meters to measure electricity use in real time connect to the broadband network.
"You need a lot of smarts and communication to make it work," Budde says. "Fibre-to-the-home networks are ideal to manage all the intelligence elements of these smart buildings and communities."
Power companies are keen to cut use because it staves off expensive generator upgrades. Smart grids also allow homes and businesses to more easily sell power into the grid and they speed the use of alternative energy sources such as wind and solar power, Budde says.
The information generated from such data collection has a value of its own. For instance, a householder could use an application on their mobile phone or on a flat screen pinned to their wall to see what energy guzzlers were in their house. A business could schedule operations for off-peak periods. And in times of national emergency, such as during the Victorian bushfires earlier this year, utilities could tweak the power supplied to devices -- such as knocking down the air-conditioning a degree or three -- to alleviate crippling loads on the network.
The smart-grid agenda is being driven by an appreciation of the effects of climate change and that consumers will respond appropriately to reduce their use if they have timely, accurate information.
Dealing with privacy
But data on individuals' energy use could be a prime marketing asset that utilities would be keen to sell to offset some of the cost of upgrading their infrastructure.
Budde says that information should remain private and protected by Australia's privacy laws.
"The overruling guideline is the data should be in the hands of the user," he says.
Security and privacy advocates such as Google share his view that such a massive store of data should be protected and handed to third parties in only the most dire circumstances of national security.
Google's PowerMeter application, launched in February, gives energy users connected to one of its test utilities in North America, India and Germany up-to-the-minute information about their power use. On its website, Google says PowerMeter is an opt-in service and "no personally identifying information will be shared between Google and the user's utility".
"All energy data will be stored securely and users will be able to delete their energy data or ask their utility to stop sending data to Google PowerMeter at any time."
Google says it is "unacceptable" that many of today's smart meters don't display information to the consumer: "Detailed data on your personal energy use belongs to you and should be available in a standard, non-proprietary format. You should control who gets to see it, and you should be free to choose from a wide range of services to help you understand and benefit from it."
The search engine titan estimates users will save 5-15 per cent on their bills and more if they retire old whitegoods such as inefficient fridges.
Software maker Microsoft has also joined the smart-grid revolution, releasing last week a test version of its US "Hohm" ("Home" and "ohm", a measure of power impedance or resistance) web application built on the Azure cloud operating system. With it consumers analyse their energy use and receive recommendations on how to reduce it.
It uses analytics provided by Lawrence Berkeley National Lab and the US Department of Energy to suggest areas where the user might be able to reduce energy use, reports smartgridnews.com. Microsoft will include data from advanced meters and help utilities measure and meet their regulatory requirements for conservation and energy efficiency leading to reducing consumption at peak times.
Other ventures will rise from the nexus of data with devices and media over the smart grid, Budde says.
"I don't know what the interconnections between the internet, entertainment and energy will be but we'll see clever entrepreneurs come up with solutions. What you will see is the possibilities when you have this IP connection, it interconnects with other digital infrastructure," he says.
"Every piece of electrical equipment will have an interconnection with the [smart-grid] network."
It's not just devices and the network that need to wise up. Pointing to the Dutch embassy in Canberra as an example of the next wave of smart architecture, Budde says buildings will be installed with sensors so that they more efficiently use energy.
"What you need in a building is that the east wall talks to the west wall to manage climate in the house, he says. "You have to build in intelligence into walls and windows or whatever the devices will be in the future to manage buildings."
But the danger is that this information and access will inevitably be abused. Speakers at the AusCERT information security conference on the Gold Coast in May pointed to holes in existing utilities' data networks that posed headaches for those policing their use.
Daniel Grzelak, an analyst with security consultancy SIFT-Stratsec, said many supervisory control and data-acquisition systems had unnecessary webpages that invited hacking.
Another AusCERT speaker, Gabriel d'Eustachio a consultant with CSC, applauded smart meters "sharing the pain" of spot prices with consumers but doubted that the rollout of smart meters would coincide with the broadband network, forcing utilities to look at other networks, most likely high-speed wireless. But this brought other problems because it made it easier for hackers to subvert the system and consumers to shunt their power use on to their neighbours.
The biggest caveats on the use of smart grids came from conference keynote speaker, Columbia University computer science professor Steven Bellovin, who queried who would have access to the data?
"How is that (electricity provider's) site protected?" Professor Bellovin asked.
"Someone can poll the thermostat in my house to see if I'm away on vacation? How do I know they can't?
"Or turn my thermostat off when I go away in winter and let my pipes freeze.
"Talk about overflow attacks."
But even if privacy and security were to fall outside today's legislation that would not be enough reason to belay smart grid deployment, Budde says.
"[With] the current legislation on privacy [it] doesn't matter if it's the internet or electricity," Budde says.
"There's a level of protection in place. Basically that would not be possible [to harvest and resell personal data] or legal under current legislation.
"That's not to say that we won't come across interesting cases we'll have to look at when it happens. We need a basic law that we can use in situations like that, a fine-tuning of legislation.
"I would be against up-front [privacy] regulations ... if it blocked [smart grids]."