UC Santa Cruz

The Internet of Things (IoT) promises many advantages in the control and monitoring of physical systems from both efficacy and efficiency perspectives. However, in the wrong hands, the data might pose a privacy threat. In this article, we consider the tradeoff between the operational value of data collected in the IoT and the privacy of consumers. We present a general framework for quantifying this tradeoff in the IoT, and focus on a smart grid application for a proof of concept. In particular, we analyze the tradeoff between smart grid operations and how often data are collected by considering a realistic direct-load control example using thermostatically controlled loads, and we give simulation results to show how its performance degrades as the sampling frequency decreases. Additionally, we introduce a new privacy metric, which we call inferential privacy. This privacy metric assumes a strong adversary model and provides an upper bound on the adversary’s ability to infer a private parameter, independent of the algorithm he uses. Combining these two results allows us to directly consider the tradeoff between better operational performance and consumer privacy.