WASHINGTON —IBM Chief Financial Officer Jeff Katz said Tuesday that the country is undergoing a “leap” forward in smart grid technology, but cautioned that this leap would introduce new security challenges.

At a smart grid technologies conference at a Washington hotel, Katz and a panel of executives from the information and energy industries articulated a future when digital technology enhances energy production and consumption.

“Smart grid” technology allows energy companies and consumers to precisely manage energy and electronics, using computers.

Panelists discuss the pros and cons of "smart grid" technology at a Washington hotel. (Chris Kirk/Medill)

For energy producers, smart grid technology means powering American households more efficiently. For consumers, it means monitoring home power use and controlling appliances from smart phones.

With smart grid technology, consumers could control electronic devices in their homes no matter where they are, and those electronics could automatically respond to consumers. For example, a home’s air conditioning and lights could shut off automatically when the homeowner leaves, and turn back on when he or she is on the way back.

“This is an exciting time,” said John Kelly, executive director of an initiative to spur smart grid development. There is an “explosion” beginning in such technology, he added.

The excitement is tempered by a security threat tied to digital technology: hackers. In a discussion centered specifically on cyber-security, experts traded ideas on ways to protect smart grids from cyber attacks.

“When you automate something, you introduce a security risk,” Katz said.

If companies do not take a host of security precautions, hackers could not only target infrastructure but also attack individual consumers in malicious and potentially lethal ways.

If proper safeguards are not put in place, for example, a hacker could deactivate the brakes of an electric car while the driver is behind the wheel, said Hina Chaudhry, a researcher from the Department of Energy, in a panel about electric vehicles.

Far from science fiction, hackers are increasingly sophisticated and the threat they pose is tangible. Some analysts say both the U.S. and China have engaged in cyber warfare in recent years.

“The next generation of terrorists will grow up in a digital world, with ever more powerful and easy-to-use hacking tools at their disposal,” wrote cyber-security expert Dorothy Denning in an article published by the Social Science Research Council.

Most recently, Iran claimed it obtained a U.S. spy drone by hacking it.