The Department of Energy grant, which was secured by US Representative Peter Welch, will help in smart-grid implementation standards and to address the cost and environmental impacts of the nation’s energy policy.

The VLS grant follows Vermont’s effort last fall to secure $69m in federal stimulus funds for its ‘eEnergy Vermont’ plan, which will help the state create jobs, reduce costs and cut fossil fuel emissions by deploying a statewide smart grid system.

Part of a $3.4bn smart grid investment created by the American Recovery and Reinvestment Act, Vermont’s funding was secured through collaboration between utility companies, state government and the congressional delegation.

VLS said that the smart-grid project will have two goals: to assess the US power grid’s legal and regulatory structures on the national, regional and state levels to improve load management and system-efficiency, and to create a model of predictable legal and regulatory standards that addresses the swiftly emerging legal issues of privacy, confidentiality and liability.

Michael Dworkin, director of the Institute for Energy and the Environment, said updating the US power grid to address energy and economic inefficiencies is vital for the nation.

Mr Welsh, said: “This project will provide the much needed legal and policy foundation to protect customer information, while increasing the efficiency of managing the transmission system, which will greatly reduce financial costs, environmental emissions and reliability concerns.

“Improvements to load management and system-efficiency, including upgrades to the network cables, transformers and power stations, will require a detailed assessment of legal and regulatory structures on the national, regional and state levels.”