When electricity first began to be used in the US, generating systems were built in order to power and illuminate mines, factories and other commercial establishments. These were “private" power plants built on site to meet the specific energy requirements of a business. In those days, only the very wealthy could afford to have their homes powered by electricity.

There was no standardization across all the various companies manufacturing these private generators. As a result, every power plant operated at different voltages or at distinct rates of oscillation depending on whether they were DC or AC systems.

In the 1890s, Chicago alone was home to 40 different electric companies, each offering power at 100 to 2,000 volts with their own system of wires crisscrossing overhead across town.

It was only when America’s first large-scale power plant was built at the Niagara Falls that thought was given to standardizing the output. After considerable debate, it was finally determined that the power generated by the Niagara Falls station would be transmitted over point-to-point high-tension wires using a two-phase alternating current.

The town of Buffalo transformed itself to accept the power being transmitted by the Niagara Falls station, conforming all electricity outlets to the new standards. It was immediately transformed into a hub for manufacturing, becoming the first place in the US to profitably manufacture aluminium and as a result was instrumental in ushering in the automobile age. Thanks to the success of Buffalo, the centralized power generation model was adopted widely and eventually became the basis for electricity supply and distribution the world over.

Today, the world runs on centralized electricity grids made up of large power- generating stations from which electricity is transmitted across large distances using point-to-point high-voltage wires and further distributed within towns and cities using networked lower-voltage delivery systems, standardized at 110 or 220 volts.

Of late, this model has begun to come under pressure. Thanks to the falling cost of renewable energy, there’s been a growth in rooftop solar installations that are capable of contributing power to the grid after meeting household requirements. At the same time, our consumption patterns have changed as rapid urbanization and the increased use of new technology has begun to place new demands on the grid.

All of this has affected our traditional patterns of supply and demand and is exerting new pressures on our creaking infrastructure. The century-old system that was designed to operate in a command and control environment is struggling to cope with the peaks and troughs of distributed demand and supply.

It is becoming increasingly evident that we will need a new model to deal with our energy future—a model that will need to encompass localized power generation coupled with energy storage solutions that will allow energy to be smartly wheeled across mini-grids established in small neighbourhoods. It will call for the deployment of smart meters and Internet of Things devices to better manage consumption by accurately predicting peak loads. To do that it will need to shrug off our dependence on a centralized grid and embrace decentralization.

The challenge of decentralization and distributed management is affecting other utilities as well. Urban water supply has always been centrally managed, supplied to our homes and offices from reservoirs through a network of underground pipes. In most cities in India, these pipes are over a century old.

Given the rapid pace of urbanization, they are falling apart under the pressure of coping with the demands of modern cities. As a result, residents in most Indian municipalities receive intermittent water supply—sometimes only once every few days.

This has forced them to take matters into their own hands, digging bore wells to directly tap into ground water to meet their requirements. Thanks to poorly coordinated ground water extraction, our water tables have begun to dry up—a phenomenon that will inevitably have long- term consequences.

As our urban aquifers dry up, we have begun to rely on water tankers, further exacerbating the problem by extending it to the outskirts of our cities.

Here too, there is merit in finding distributed data-driven solutions. By systematically deploying smart water meters and sensors, it should be possible to dynamically assess water consumption patterns at different times of the day and year. Satellite data and ground sensors should be able to give us insights into the availability of groundwater. When coupled with global positioning system-enabled tanker fleets, this should make it possible for us to efficiently move water from areas with abundant supply to those that need it.

If we can intelligently gather information about our urban water requirements, we should be able to correlate that with availability, dramatically improving efficiencies to the point where we should be able to meet our demand from the available supply.

Inasmuch as our utilities were built on a command and control style of administration, their future lies in distributed management. The internet of things and abundance of a variety of sensors makes this possible in the here and now.

All it needs is for us to let go of our preconceptions about how our cities should be managed, and embrace a decentralized future.

Rahul Matthan is a partner at Trilegal. Ex Machina is a column on technology, law and everything in between. His Twitter handle is @matthan.

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