The networking giant quietly gave the green light two months ago to plans for the smart grid unit. The group is now hiring engineers with a focus on people inside Cisco and power engineers from utilities.

"We need to have expertise in all the different sorts of grid systems we will touch," said Laura Ipsen, general manager of the group and former vice president of policy for Cisco in Washington D.C.

Ipsen would not say how many engineers the group will hire. However, the group aims to have its core team in place by the close of Cisco fiscal year ending in September.

Initial members of the group have already taken an active role in smart grid standards efforts. They also have scoped out ideas for the group's first products which will hit the market sometime next year, Ipsen said in an on-stage interview at the Greenbeat conference here.

Ultimately the group aims to deliver products for a broad range of power transmission, distribution and home networks, Ipsen said.