Just how safe do you think your personal data is? If recent hacking scandals involving big names like Sony and J.P. Morgan Chase showed us anything, it was that no one’s personal data is as safe and secure as we would like to believe. And beyond issues regarding personal correspondence, medical data, or financial information getting into the wrong hands, there is also a new way for power providers to track and monitor your energy usage – and this system isn’t safe either. The new “smart meters” put into practice in the United States are already raising serious cause for concern.

But what kind of data could be obtained by utility conglomerates from these meters without the knowledge of consumers, and how could that data could be misused or fall into the hands of hackers?

It’s been reported that the data these meters collect will be more valuable than the energy they’re intended to monitor – and that’s a tragically ironic situation if there ever was one. But before we get into the politics of it all, let’s talk about why the issue of “smart” meters – and the “smart grid,” in a more broad sense – is considered “desperately important” and why it’s capable of infringing on what seemingly little privacy we have left.

When one thinks of a power or energy meter, as found in the average American home, it doesn’t normally conjure up visions of data-robbing and vital statistical information being at risk. At first glance, smart meters appear to be the perfect solution to manage energy saving, because they by helping people understand where their energy is being used and better manage that usage, they can save homeowners and businesses money on energy bills. Yet as of late, security-conscious types have begun questioning the type of data smart meters generate and making other queries including how secure they really are, what kind of information they’re sending and, perhaps most importantly, who is receiving that data…and what they are doing with it.

The Good, the Bad and the Downright Ugly

Globally, there has been a shift towards smart meters from American and Canadian energy providers as well as quite a few European nations. From an efficiency standpoint, the meters seek to improve efficiency by 3% and reduce energy consumption by 20% by the year 2020, with 2012 seeing the largest drop, some 12.1%, since 1990. Smart meters work by way of facilitating communication between electricity providers and consumers, resulting in more flexibility than older systems and proving to be a reliable and efficient by way of allowing consumers to monitor energy usage for greater efficiency.

Other benefits of the smart meter approach for homeowners include no estimated bills, no manual meter reading, easier access when switching to a different energy provider and the provision for knowing which appliances are using how much energy and when.

But like with so many other avenues of life, there’s a flipside to that proverbial coin. Smart meters are potentially vulnerable to fraudulent meter readings, government surveillance, cyber terrorism and “hacktivists.” Additionally, because the grid accepts power from an increased number of sources, there exist more pathways for malicious agents to gain access to the grid, and because smart meters communicate with the utility company, they are susceptible to malicious actions in a way traditional meters never were.

In one recent case in the United States it was discovered that former employees of the meter manufacturer and employees of an energy provider were hacking into the smart meters to allow people to essentially steal power by altering the data the meters were sending – and even selling this service at $300 to $3,000 a pop. Upon further investigation, it was concluded that hackers used tools such as an infrared light connected to a computer to change power consumption recordings, using software easily accessible and free-of-charge online, and that even something as simple as holding a magnet against a smart meter could cause it to stop recording electricity usage.

In the wake of these problems have come greater government oversight, the utility industry working to provide “better security” against cyber-attacks and many organizations beginning work with Homeland Security to learn ways to detect and block such attacks. In fact, one such organization, Virginia’s Dominion Resources Inc. – also the state’s largest electricity provider – plans to spend $500 million by 2019 to increase security.

Are smart meters and other appliances in the “smart” home a good idea or not? It seems it’s up to the individual to decide, but we can tell you this: The security holes these devices create may make them simply not worth the risk.

Beth Kotz is a contributing writer to Shift Frequency

Why New Smart Meter Technology Won’t Keep You Safe by Beth Kotz is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.