The $4.5 billion in matching funds allocated to "Electricity Delivery and Energy Reliability" by the American Recovery and Reinvestment Act (ARRA) includes a significant boost to “smart grid” and smart metering initiatives, aimed at updating the seriously ageing U.S. electrical infrastructure.

“ABI Research believes that the rapid injection of capital to be provided by the ARRA will solidify and encourage more investment in smart metering and the smart grid,” says senior analyst Sam Lucero.“

Many utilities were already implementing plans to upgrade distribution and metering infrastructure, and as regulated industries with rate recovery mechanisms in place, electrical utilities have been somewhat insulated from the worst shocks of the recent economic turmoil. So, says Lucero, “The new federal funding is not an order-of-magnitude game changer, but it will certainly help to encourage and accelerate new smart grid plans, and reinforce those already in place.”

Who will benefit from these provisions of the ARRA and the resulting boost to smart grid and smart metering? There are winners on all sides.

  • Module vendors, because advanced metering infrastructure is a major application market within the larger machine-to-machine communication field.
  • Smart meter vendors.
  • Meter data management software developers such as Oracle, SAP, and eMeter, because as smart metering systems are rolled out, the amount of information needing to be processed rises very sharply.
  • Electrical utilities such as Pacific Gas & Electric, which are committed to large-scale upgrades of the meters deployed in the areas they serve.
  • The public. A more robust infrastructure will, among other benefits, reduce the blackouts and brownouts that occur across the country on a daily basis.