How Italy Beat the World to a Smarter Grid

After several false starts, 2010 finally could be the year when smart meters go global. The technology, which lets energy companies and consumers more closely monitor their electricity consumption, has many champions. The U.S. government has earmarked $4.5 billion from the stimulus package to subsidize the rollout of smart meters nationwide. European Union politicians are pushing hard to connect 80% of the region's homes and businesses to smart meters by 2020. Even emerging giants like India and China aim to install the technology in new buildings.

But with billions of dollars on the line, policymakers don't want to make costly mistakes. Many of them are thus eyeing the remarkable experience of Italy, which in less than a decade has become the surprising world leader in the development of a smarter electrical grid. Some 85% of Italian homes are now outfitted with smart meters—the highest percentage in the world and more such devices than exist in the whole of the U.S. Utilities worldwide, such as San Francisco's PG&E (PCG) and Florida's FPL Group (FPL), are eager to learn how Enel pulled off its smart meter revolution.