by Yana A. St. Clair, Esq.
As utilities adopt smart grid technologies, they must navigate evolving legal frameworks while maintaining reliable service and protecting critical infrastructure.

After having spent a number of issues discussing AI and all the potential issues, do we love, or not so much, we are switching to a new topic. Digital Transformation! And let’s have some fun with it over the next few issues!
Now to begin, the digital transformation of the electric power industry creates complex legal challenges spanning cybersecurity, data rights, and regulatory compliance. As utilities adopt smart grid technologies, they must navigate evolving legal frameworks while maintaining reliable service and protecting critical infrastructure.
Cybersecurity presents significant legal exposure. Utilities face mandatory standards under NERC CIP regulations, but compliance alone may not shield them from liability when breaches occur. The interconnected nature of modern grids complicates liability allocation when incidents affect multiple systems or organizations. Insurance coverage often contains gaps for cyber events, leaving utilities exposed to significant financial risk.
Data rights and privacy emerge as critical legal concerns with the proliferation of smart meters and grid sensors. Utilities must determine who owns various types of grid data and what rights different parties have to access and use it. Customer privacy rights vary by jurisdiction, requiring careful attention to compliance. The value of grid data for optimization and new services creates tension between commercial opportunities and privacy protection.
Regulatory compliance becomes more complex as digital systems reshape traditional utility operations. Regulators require transparency into automated systems while utilities must protect sensitive infrastructure information. Integration of distributed energy resources challenges existing regulatory frameworks, raising questions about market participation rules and operational responsibilities.
Cross-jurisdictional issues arise as grid digitalization spans traditional boundaries. Utilities must reconcile different state requirements while maintaining interoperability. International data flows require compliance with varying privacy and security regulations. Market participation across regions necessitates careful attention to multiple regulatory frameworks.
Property rights questions emerge around digital infrastructure deployment. Utilities must secure necessary rights-of-way and access rights for sensors and communication equipment. Customer-owned distributed resources raise questions about data rights and operational control.
These legal challenges require utilities to balance innovation with risk management. Success demands careful attention to evolving regulations while maintaining system reliability and security. Organizations must develop comprehensive legal strategies that address multiple stakeholder interests while enabling the benefits of digital transformation.
The digital transformation of the power grid also raises complex questions around data ownership between utilities, customers, and third-party providers. Grid operations data presents another layer of complexity. This includes data from grid sensors, monitoring equipment, and customer-owned distributed resources. The interconnected nature of the modern grid means multiple parties may have legitimate claims to the same operational data. For instance, both utilities and third-party providers need access to performance data from customer-owned solar installations or storage systems to ensure reliable grid operation.
Market data ownership adds further complications. This encompasses transaction data from energy markets, bidding and pricing information, and demand forecasting data. Market participants require access to this information for effective participation, yet its sensitive nature raises questions about ownership rights and access limitations.
These ownership rights further complicated by a number factors. Multiple stakeholders frequently have legitimate claims to the same data sets, making exclusive ownership rights a bit difficult. The data is frequently necessary for both basic system operations and competitive market functions, creating a bit of friction between accessibility and competitive advantage. Privacy requirements vary significantly across jurisdictions, adding regulatory complexity. Grid operators must balance transparency needs with cybersecurity concerns, while the growing value of data for grid optimization and new service development adds commercial pressures.
Current legal and regulatory frameworks often lack clear guidance on several critical aspects of data ownership. These include data portability rights, and how long varying parties can retain data, permissions for secondary uses, appropriate compensation for data access, and mechanisms for resolving ownership disputes.
There are many potential issues regarding this topic, and we are looking forward to exploring them further. Now until next time, when we delve into critical infrastructure protection!
Disclosure: Please note that none of the information contained within the above column is to be considered legal advice.
Biography

Yana is an American attorney licensed to practice in all State and Federal courts of California. Yana holds a Bachelor of Arts Degree in Political Science specializing in International Relations from UCLA, the Degree of Juris Doctor from Loyola Law School, and a Master of Business Administration Degree from Ashford University. Since the beginning of her undergraduate studies, Yana has been involved in various aspects of the field of Electrical Engineering, where she employs her business and legal knowledge to consulting and advising businesses and individuals on relevant topics of concern. Yana also serves as Editor for PAC World magazine, having been with the publication since its inception. As an attorney, Yana specializes in criminal defense, where she devotes her talents and expertise to fighting for her clients’ rights and freedom.