Intel chief executive Paul Otellini has told delegates at Oracle OpenWorld 2008 that his company is supporting a new effort to build an intelligent electricity grid.

Otellini introduced Erfan Ibrahim, from the Electric Power Research Institute (Epri), a non-profit foundation funded by electricity companies to promote better power efficiency.

Epri is starting a new five-year project to build a $20m (£10.8m) test bed network, which takes power from a variety of sources and balances it into usable supply. This would be a mixture of traditional and variable power supplies, such as renewable energy including wind.

"The smart grid is a mix of communications technologies and energy efficient designs," said Ibrahim.

"They allow you to set up demand response programmes to reduce the need for generation units. It also allows you to add in electrical systems like photovoltaic energy and balance them out."

Ibrahim explained that open and compatible standards are essential for the system to work. Standards like WiMax could move the grid from a theoretical exercise to concrete examples of how to cut costs, he said.

Otellini added that power efficiency will be one of the key drivers for business use of technology in the future, because it is good for the environment and good for the bottom line.