Law in the Internet Society

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GreggBadichekFirstEssay 5 - 27 Jan 2016 - Main.GreggBadichek
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 -- By GreggBadichek - 04 Nov 2015

Introduction

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Smart grid technology would rely on real-time data collected from electricity consumers; this data would sync to each household’s existing internet environment, and would likely contain information similar to that sent out by the average American smart phone thousands of times daily. The true innovation of the smart grid is digital infrastructure, and the data it shepherds. The two-way flow of information between the energy grid and the consumer actuates the information management protocols necessary to make that grid “smart.” That data allows the grid machines to automatically measure, send, receive, and shift energy toward the most efficient allocation of resources, thereby promoting consumer control over energy.
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Smart grid technology would rely on real-time data collected from electricity consumers; this data would sync to each household’s existing internet environment, and would likely contain information similar to that sent out by the average American smart phone thousands of times daily.[1] The true innovation of the smart grid is digital infrastructure, and the data it shepherds. The two-way flow of information between the energy grid and the consumer actuates the information management protocols necessary to make that grid “smart.” That data allows the grid machines to automatically measure, send, receive, and shift energy toward the most efficient allocation of resources, thereby promoting consumer control over energy;[2] but what of consumer control over information?
 

Economics of the Smart Grid

The dumb grid technology requires bulk capacity sales at the wholesale level from generator to distributer, but the retail level from distributer to consumer requires sales of energy at hourly rates. Smart grids will shift power economics by severely reducing demand at the retail level. As a result, utilities selling energy on a smart grid will need to recoup significant capital expenditure while suffering a loss of hourly power sales in the long term. For this reason it will no longer make sense for utilities to operate on volumetric sales with guaranteed recovery of capital expenditure; they will need to shift their business model to one based on providing reliable service for a guaranteed flat rate.
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So long as the operative software on the smart-grid remains obscure, consumers will never be able to understand how their data is collected. As utilities are part of a regulatory compact, and this software intimately affects consumers' lives, the code should be made reviewable under government order. A greater number of reviewers will detect privacy problems and solutions more effectively than the utility alone. Thereafter legal challenges against privacy invasions will gradually create a regulatory regime.

Law Enforcement

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Under current Fourth Amendment doctrine, information collected via smart meter communications and retained by utility companies lacks constitutional protection against warrantless search and seizure; placement in the hands of a Third Party essentially removes the reasonable expectation of privacy underlying that protection. See Maryland v. Smith, 442 U.S. 735 (finding no expectation of privacy in phone records “voluntarily conveyed” to a telephone company or utility records “voluntarily conveyed” to a utility company). Law enforcement officials, of course, use utility records frequently in criminal investigations. The utility to investigators of data poured into the smart grid would dwarf that of the dumb grid.
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Under current Fourth Amendment doctrine, information collected via smart meter communications and retained by utility companies lacks constitutional protection against warrantless search and seizure; placement in the hands of a Third Party essentially removes the reasonable expectation of privacy underlying that protection.[3] Law enforcement officials, of course, use utility records frequently in criminal investigations. The utility to investigators of data poured into the smart grid would dwarf that of the dumb grid.


Еhe Supreme Court in Riley v. California, 134 S. Ct. 2473 (2014), indicated that the traditional distinction between reasonable and unreasonable expectations of privacy is obsolete in the digital context, where the bulk of private data is digital, and flows to countless third parties. Legal challenges to warrantless collection of smart grid data should therefore seize upon the Court’s language. The Fourth Amendment argument, specifically, would likely focus on this data’s total representation of activities in the home—the very raison d’ętre of the Fourth Amendment.

[1] https://epic.org/privacy/smartgrid/smartgrid.html
[2] https://www.smartgrid.gov/the_smart_grid/smart_grid.html
[3] See Maryland v. Smith, 442 U.S. 735 (finding no expectation of privacy in phone records “voluntarily conveyed” to a telephone company or utility records “voluntarily conveyed” to a utility company).

 
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Fortunately, the Supreme Court in Riley v. California, 134 S. Ct. 2473 (2014), indicated that the traditional distinction between reasonable and unreasonable expectations of privacy is obsolete in the digital context, where the bulk of private data is digital, and flows to countless third parties. Legal challenges to warrantless collection of smart grid data should therefore seize upon the Court’s language. The Fourth Amendment argument, specifically, would likely focus on this data’s total representation of activities in the home—the very raison d’ętre of the Fourth Amendment.
 
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