Before we answer the question posed in the title of this piece, let's paint in some of the background of the smart grid business.
Last month on our blog, we posed the question: will smart grid outperform its cleantech cousins and become the jewel in the industry's crown? We concluded that for a number of reasons, smart grid offers a less risky investment to both financers and players, and that there is a growing trend among investors to move away from the highly capitalized sectors of the renewable market in favor of smart grid.
Not all sectors of the smart grid are as capital intensive, and as we showed in the April report "Smart Grid is Just Too Big for the Utility Companies to Finance and Manage," the industry will require some nurturing to overcome some of its growing pains. We concluded that the electrical utility industry will likely be required to invest massive sums of money, and while they may be able to justify this based on long-term projections, it remains to be seen whether they will be able to find the money to fund such an effort. It cannot be generated from cash flow alone and government subsidies are unlikely to continue at their present level of generosity. Read more here.