The high tech industry will play a significant role in the battle to reduce greenhouse gas emissions as long as the Internet remains a level playing field. The opportunities for software companies to innovate in the energy generation and energy efficiency sectors are substantial if the priority of traffic over the Internet remains neutral (i.e., the FCC adopts net neutrality rules).

The smart grid is the main prerequisite to the Internet’s involvement in energy. The Obama Administration recently announced $3.4 billion in the development of the smart grid and related technologies. Much of these funds went directly to utilities to provide smart meters in homes and businesses. Southern California Edison has already started its rollout of smart meters under a program called SmartConnect; they hope to have 5 million smart meters active by 2012.

The fundamental breakthrough of smart meters is the ability to communicate information bidirectionally. Like a normal power meter, the smart meters can measure the energy consumption of the consumer, but they also can send that and other information to the local utility as well as to devices located on the property of the customer (e.g. smart thermostat, smart refrigerator, etc.). A completely new market for energy efficiency products will exist when users begin connecting these smart meters to the Internet. This connection will remove the shackles from energy software outfits such as OPOWER [view some of their current clean tech job openings on the CleanTechies Job Board] and Google.org.

The Internet has an infrastructure capable of revolutionizing energy use both at home and at the workplace. For instance, we all have widgets staring at us on our computers these days. Imagine having a widget that was giving you a real time view of the electricity consumption at your home or in your office and the ability to reduce that energy use from the convenience of your office chair. One could also schedule consumption levels based on their personal preferences and real-time electricity rates. Companies have already started sprouting up to focus on these emerging technologies and this market will only grow as utilities create the smart grid. Another dependency not often included in this discussion is a free and open Internet, more commonly referred to as net neutrality.

The reliability of software that uses the smart grid and the Internet is dependent on net neutrality to ensure Internet Service Providers (ISP) deliver bidirectional data as quickly as possible. If the Internet did not operate on a level playing field (e.g., PG&E’s Internet traffic was given priority over data from a personal web server), then the growth of distributed generation and other electricity control options could stagnate. How can someone make his car’s batteries available for use by the smart grid if ISPs constantly push the control signals to the back of their data transfer queue?

The free and open flow of data on the Internet is not only important for individuals and small companies looking to spread their message. Net neutrality is an important issue for those trying to combat climate change through improvements in energy generation and energy efficiency.

Related posts:

• Smart Grid Riding On The Information Superhighway
• Clean Tech Event: Smart Grid Bilateral Trade and Investment Opportunities
• News Corp Goes Carbon Neutral: Surprised? (You Shouldn’t Be)
• Siemens Promotes Smart Grid Technology Innovation Contest
• U.S. Unveils Programs to Modernize Electric Grid System