Solar panels on the roof of your local library? What are smart thermostats? What if you could turn on your light bulbs with your smartphone? Is your electric utility using these modern technologies to their full potential? Most likely not.

Most utilities are antiquated, and they do not know how to incorporate innovative technologies into the electric grid. This is when grid modernization enters the picture. It is a wonderful way of putting and bringing utilities into the twenty-first century into words.

And if we don’t alter the way utilities operate, the stakes are high. Without modernizing this system, which was established before today’s renewable energy technology existed and before we understood climate change was a concern, we won’t be able to address climate change effectively. Read about renewable energy in Nigeria.

Grid Innovation

What is Grid Innovation

Grid Innovation is the advancement or innovative opportunities to achieve electricity bill savings for ratepayers by developing projects or incorporating existing projects that enable customers to better manage their energy consumption. Or goes to reduce the costs associated with maintaining reliable operation of the country’s grid.

What is Grid Modernization

Grid Modernization is those changes needed in the power grid to reconcile and harmonize all the swift technological changes occurring in the generation, transmission, and distribution of electric power.

3 Major Areas of Change for Grid Modernization 

There are three major areas of change for grid modernization: incentives, competition, and intelligence. Let us look at them individually:

1. Incentives

Utilities provide a critical service, but they are also companies, with most of them owned by profit-seeking investors. Utilities are currently profiting from large investments in physical infrastructures, such as power lines and substations, as well as selling increasing amounts of electricity. Normally, they have little incentive to assist consumers like you and me in conserving energy or running our homes and companies more efficiently because it would reduce their profit margins.

We can, however, alter the rules of the game by modernizing how we pay our utilities and how we reward them for outstanding performance.

They can amend the rules that the state utility agency uses to pay utilities to offer them a bonus when they increase energy efficiency instead of compensating them for selling more electricity. We can also stop tying utility pay to the amount of electricity sold. Decoupling refers to laws that decouple utility revenues from overall electric or gas sales, eliminating the utility’s incentive to sell more and more energy, especially when consumers like us don’t want or need it.

Changing these incentives not only saves money for families and businesses. But it also assists utilities in moving away from costly new power lines and unsightly substations. Then it moves toward increasing rooftop solar, batteries, and energy savings.

Read- Top 11 Solar Energy Companies in Nigeria.

2. Strengthening competition and customer choice

We also require competition space. Our local utility currently has a monopoly not only on the power lines that carry energy to our homes but also over the distribution of that energy. They also have complete control over data related to the electrical system and client usage.

They aren’t even required to provide such information to us, the customers who are footing the bill. This wasn’t a major concern in the earlier days because we couldn’t do anything with that information, anyway. But today, firms like Apple and Google (along with others in the area) are lining up to provide us with home energy solutions that will save us money and make our lives easier, such as connecting our appliances and power systems to centralized information system that we can control. However, students must first learn about how humans use energy. And if we don’t have it, we won’t be able to share it with innovators.

So, as customers, what can we do? We can impose minimal criteria for data gathering, customer openness, and third-party innovators’ access to anonymous data. We open up the system for clean innovations like smart home controls and targeted renewable energy by modifying the rules to ensure openness, and we give consumers like you and me a lot more choice about how we operate our own homes.

Read- Wind energy- A choice of energy generation in Nigeria.

3. Adding intelligent software and smart technology to an archaic system

Creating a “smart grid” is one way to modernize our electric grid. We update our technology and infrastructure to make our system smarter. This can help us save money by increasing energy efficiency with programmable street lights, allowing the grid to use electric vehicles as backup power sources, and lowering our monthly bills by lowering the price of electricity when market prices fall. A smarter grid also allows us to better integrate renewable energy sources like wind and solar, as well as keep the lights on during major storms.

Another example is a smart technology that instructs your hot water heater to reduce the temperature when the weather is hot. This option not only saves you money but also eliminates the need for the dirtiest power plants, which are only turned on during the hottest days of the year.

Grid Modernization: A Makeover for Your Local Utility

Improve the physical foundation of our electric grid, for example, by updating antiquated pole-and-wire systems to better incorporate rooftop solar panels. Thereby allowing for a two-way flow of energy from our homes to the grid and back. Instead of the one-way flow of energy that is old-fashioned. Installing smart meters to show us our minute-by-minute energy use so that households and businesses can figure out what’s driving their energy use up and lower their bills and minimize pollution is another example.

However, updating the policies that teach utilities how to do business is a big part of modernizing our electric system. Most of these policy changes begin with the Public Utilities Commission (PUCs) or Departments of Public Utilities (DPUs), the state agency responsible for keeping the lights on and establishing the standards that utility firms must obey. Each utility agrees to obey the rules set forth by the state utility agency for being granted a monopoly over a certain territory. As a result, advocating for key policy changes at the PUC or DPU, such as policies to upgrade our power grid, can have a significant impact on families and the environment.

Grid Modernization Saves Money and Helps Fight Climate Change

A combination of governmental changes and smaller expenditures makes the renewable energy shift workable in modernizing our electricity grid. We can encourage energy efficiency, keep the lights on, and keep our air, water, and environment safe with a modern electric system and the correct utility incentives.

It is time for New Nigeria’s utilities to catch up with the rest of the world. We can adapt swiftly to climate change and give people what they want great, money-saving options that help make families and businesses happy while preserving the environment–if we make the grid faster, smarter, and open to employing the latest technology.


Grid modernization benefits all parties concerned in terms of electricity, the environment, and the economy. For residential, commercial, and industrial electricity users, increased reliability, energy management options, and financial incentives are key benefits.