The State Grid Corporation of China is one of several bidders alongside Singapore Power seeking to buy Transgrid, operator of the electricity transmission network in the Australian state of New South Wales with a view to building an Internet of Energy.
According to the Sydney Morning Herald, the State Grid Corporation chairman, Liu Zhenya has spoken at United Nations forums and APEC meetings about building the Internet of Energy.
The Chinese electric utility company is seeking to build the Internet of Energy whereby clean energy is distributed using the ultra-high voltage transmission lines State Grid is creating. The Internet of Energy phenomena includes smart grids, connecting billions of household smart meters to the internet.
Creating a global ‘Internet of Energy’
China’s State Grid began its efforts toward building a global Internet of Energy in recent years, when in 2010, it became the “first Chinese company to acquire complete control of a foreign electricity grid - Brazil's,” reports the Sydney Morning Herald.
It added that the utility company owns 40% of the Philippine national grid and paid a 40% market premium to purchase a quarter of Portugal’s grid, while elsewhere in Europe has “won a third of the Italian grid” and is reported to be shortlisted for Greece’s electricity network.
The State Grid met twice with the NSW government before the decision was taken to privatise the poles and wires in New South Wales. The company is currently bidding, in a consortium, for 100% of the high voltage network TransGrid.
Adding to its bid for TransGrid, the Chinese utility controls 19% of Victorian transmission company SP Ausnet.
Does State Grid’s ambitions pose a security threat?
The Sydney Morning Herald has reported “that several reports have warned the US Congress that smart grids open a greater threat of cyber terrorism and infiltration by foreign intelligence services."
Gregory Austin, visiting professor at the Australian Defence Force Academy's Australian Centre for Cyber Security and author on China and cyber policy, said: "The federal government should be very concerned about Chinese ownership, indeed any foreign ownership, of the most critical element of our nation's infrastructure.
"There is no internet without electricity, so the two are inseparable.
Austin is of the opinion that State Grid’s internal expansion is purely about economic growth. He adds: "I see no evidence of Chinese military threat at this time to our security, but we should not allow foreign control of our electricity grid.”
China security expert at the Lowy Institute, Bonnie Glaser, added that the State Grid "has expanded overseas and appears to have a great ambition of building an international smart grid.
“Apart from profit, it could have other motives, but without more information this is difficult to assess."