The report calls on NIST to form a group to identify Internet Protocol software suites needed for smart grids. NIST should commission a separate group to study interference in unlicensed radio spectrums for smart grid applications, it said.

The report is one step toward the government's goal of laying out key standards for smart grids. NIST plans to publish this fall a roadmap to smart grid interoperability standards.

The agency held summits on the issue in April and May that attracted more than 1,000 attendees spanning utilities, vendors and consultants. The current report is one of the outcomes from those meetings.

According to the report a smart grid "will be characterized by a two-way flow of electricity and information to create an automated, widely distributed energy delivery network."

The report calls on NIST to define common language and pricing models to serve the various parties involved in building and running smart grids. It also charges the agency to set standards for synchronizing events over a smart grid and to be responsible to coordinate efforts on smart grids across multiple standards organizations.

The IEEE 2030 group held in early June its first meeting to define a broad set of technical standards for smart grids ranging across computer, communications and power equipment.

Utilities and equipment vendors have been pursuing smart grid concepts such as smart metering for years, but to date the efforts have been largely ad hoc and based on proprietary technologies.

"There is no clear path to the future smart grid for every technology and every capital investment made in the past," the report said. "Encapsulation of existing systems for interoperation with the smart grid will remain a significant challenge," it added.

The U.S. federal government has mandated NIST to spearhead an effort to set smart grid standards. The agency got $10 million under President Obama's economic stimulus package to carry out that work.