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Funding for smart grid security will continue to grow over the next five years, a new report said.
With the U.S. electrical grid poised to become smart systems with integrated communications, the possible threat of cyber attack is a bigger issue. Because of that threat, the U.S. government has set aside funding to develop security protocols.
The U.S. is not alone as other countries are joining in to invest in their own smart grids.
Between this year and 2015 companies will spend about 15 percent of all smart grid investments on cyber security, according to the report by Pike Research. This will represent a total global investment of $21 billion over the next five years, according to the report.
North America will spend the most with a predicted annual figure of $1.5 billion by 2015, followed by Asia Pacific at $1.2 billion and Europe at $784 million.
It became very clear in 2009 the U.S. electrical grid was vulnerable to sabotage after hacker spies breached the system testing access to the smart grid. Since then, there has been a major push to better secure smart grids.
“Despite the increased emphasis, the lack of interoperable cyber security standards continues to be a major issue,” according to the report.
The U.S. Department of Energy and the Federal Energy Regulatory Commission is pushing the National Institute of Standards and Technology to develop standards that can integrate with all types of systems that make up the web of smart grid communications.
As of 2010, the report said, there are five major areas that make up a smart grid system in which standard issues may arise: “transmission upgrades, substation automation, distribution automation, electric vehicle management systems, and advanced metering infrastructure.”
Pike Research’s analysis indicates utilities remain focused on finding end-to-end cyber security solutions across a variety of smart grid application areas and geographies, as companies view cyber security as a cross-cutting feature of smart grid deployments. This need for end-to-end solutions has opened new market opportunities for systems integrators and framework developers to collaborate with traditional utility industry players, including metering and transmission and distribution (T&D) infrastructure vendors.

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