Smart grids called vulnerable to hackers

"A smart grid, by connecting the power industry to the Internet, opens the door for anyone who wants to mess with the power system in the U.S.," said Dr. Stephen Holditch, a professor at the Texas A&M Energy Engineering Institute.

CenterPoint Energy, which distributes electricity to Houston-area customers regardless of retail provider, has installed more than 100,000 smart meters, and other Texas utilities are installing them as well.

The meters are a component of smart grids that use the Internet and other information technology to monitor and control generation, delivery and consumption of electricity -- allowing customers to better track their power use and improving utilities' ability to identify and fix outages.

While smart grids are heralded as potentially saving the U.S. $130 billion over the next decade, the linking of the power grid with communications systems provides potential openings for hackers, Holditch said at the annual conference of the Academy of Medicine, Engineering & Science of Texas.

The need for a secure grid was among several topics raised as Holditch presented findings of last April's Texas Energy Summit.

Others included shale gas regulation, transportation, nuclear power and renewable energy.

Developing appropriate regulations to oversee shale gas production is one of the greatest energy challenges facing Texas, Holditch said, and he prefers keeping it close to home.

"We have to have rules and regulations on how to oversee the natural gas industry, but this should be done at the state level, not at the federal level," he said.

Holditch identified possible effects on water supplies and air pollution as the most pressing issues related to natural gas drilling.

Holditch also discussed scientific discoveries that could lead to production of ethanol from natural gas, rather than corn.

Celanese Corp. has developed a technology for converting natural gas to ethanol that would be more cost effective than using corn, according to the Energy Summit report.

"The current challenge is to increase the demand for natural gas so that prices are high enough to justify resource development," the report stated.

The federal government has subsidized corn-based ethanol, which is mixed into the gasoline supply to reduce tailpipe emissions of pollutants and greenhouse gases.

"Maybe we should save the corn to eat and drink -- as bourbon," Holditch said.