A flurry of announcements is coming out of the smart-grid movement, now that $11 billion from the economic stimulus bill has been allocated to upgrading the nation's electrical system.

Last week, AT&T announced it expanded its relationship with SmartSynch to provide electric utilities with a smart-grid solution for individual homes that is an alternative to using private networks. The two are combining a suite of wireless service plans from AT&T designed specifically for machine-to-machine (M2M) communications with SmartSynch's smart grid, which is deployed in more than 100 utilities throughout North America.

Smart grids combine "smart meters," wireless technology, sensors and software so customers and utilities can monitor energy use and taper usage when the availability of electricity is limited. The IP-based, smart-grid model ultimately will help consumers understand the economies of their consumption patterns, so they can make changes in the home. Utilities can use it to help energy reliability and energy efficiency, while reducing power-line losses.

However, the challenge for AT&T and SmartSynch is convincing utilities to move away from building their own networks for monitoring to utilizing commercial technology from AT&T. Henry Jones, chief technology officer with SmartSynch, said the economics around utilities building their own mesh networks don't make sense.

"Billions have been invested in GSM technology, the modules are less expensive and the equipment AT&T uses enables us to provide lower cost per kilobyte," Jones said. AT&T is able to price specific to utility needs, which is for very small amounts of data but often for millions of users.

Slower data transmission technologies such as GSM/GPRS and EDGE are being used today in monitoring systems, primarily because of the vast economies of scale that come with the technology and the fact that the monitoring taking place today doesn't require a lot of speed, Jones said. Going forward, however, utilities will be able to take advantage of higher-speed technologies such as HSPA and Long Term Evolution (LTE), the vision for 4G broadband.

While it's true that a number of companies have made announcements in the smart-grid space following the $11 billion in stimulus money, Jones said its deal with AT&T was going to happen independent of the money coming in. But the stimulus money makes the prospect of moving technology out to each residential utility meter a more palatable opportunity to utility companies, he said.

For AT&T, the announcement is part of the company's initiative to bring wireless connectivity to a host of devices and applications that previously were not connected — mini computers, in-car entertainment and navigation systems, cameras and machine-to-machine communications.