Grid of the Future: Smart Meters...

Among the companies announcing projects in the wake of last week's announcement are National Grid, which is planning a $240 million smart-grid upgrade in upstate New York; a Northwest utility consortium led by the Bonneville Power Administration that's reportedly seeking around $200 million; and another consortium led by Florida Power & Light that is planning a $200 million initiative in Miami-Dade County. (One of FPL's partners is GE, which owns NBC Universal, which in turn is a partner in the msnbc.com joint venture.)

The Miami project would involve installing high-tech control systems at power stations, as well as encouraging the use of energy-smart appliances, thermostats and electric meters in homes and businesses. For example, smart washers and dryers can be programmed to do their business during off-peak hours, leveling the load on the local grid. Smart thermostats can automatically adjust themselves to your daily routine. Smart meters can show you how to trim back on power consumption (and your power bill).

The cost savings can range from less than 5 percent to more than 25 percent, depending on whether you're a lackadaisical power user or the home-electricity equivalent of a hypermiler. Kevin and Jodi Linn, a Miami couple profiled on NBC's TODAY show as early adopters of smart-grid technology, say they're saving $100 a month by keeping a close watch on their in-home energy display.

Msnbc.com's Red Tape chronicler, Bob Sullivan, reported that the issue generated a lot of buzz at a recent conference. He quoted Alan Paller of the security firm SANS as saying, "There was real anger by the security guys, saying these people are out selling new meters that can be taken over by a computer worm."

Various kinds of smart meters are available and in use around the country. Depending on its capabilities, a smart meter — at a cost of about $200 per home — also can play a role in how much information about energy use is made available to customers and how much money can be saved. The most advanced ones allow the utility and the customer to gauge usage and cost immediately, instead of once a month after a meter reader makes the rounds.

Utilities plan to offer a menu of rate plans. In its pilot, PPL offered something referred to as a "time-of-use" rate, where set periods of higher prices contrast with periods of lower prices. In this case, pilot participants paid more between noon and 7 p.m. on weekdays and less the rest of the time.

Some rates, called "real time," change throughout the day as the wholesale price floats up and down. People who sign up for such plans may receive signals, such as e-mails or cell phone messages, to tell them prices are climbing dangerously.
"Critical peak" rates would apply only on the dozen or more highest-demand days of the year.

So far, pilot programs have found that the average customer usually saves money. Critics note, however, that's not always the case.

In the pilot program Brubaker signed up for the past three summers, about one in four PPL customers accumulated bigger bills than they would have logged on the average rate.

In a Commonwealth Edison Co. pilot program in Illinois, the average participant paid about 7 percent more in 2005, a departure from the pilot tests of other years. Company officials blamed the increase on spiking prices during an unusually hot summer and the disruption of natural gas supplies caused by Hurricane Katrina.

Last year, about 95 percent of the participants saved money in Commonwealth Edison's open-enrollment residential real-time pricing program, thought to be the nation's first. The majority saved between 7 percent to 12 percent, the utility said. To date, about 4,000 of the utility's 3.3 million residential customers have signed up.

A brochure the utility mailed to customers advises the program might not be for them if, for instance, they don't work during the day, don't have electric heat or have a medical condition.

Utility officials say they do not expect such time-based rates to become mandatory for most ratepayers.

Ongoing daily Time-of-Use (TOU) meter charges applicable to customers taking voluntary TOU service under this rate schedule will no longer be applied if the customer has a SmartMeter™ installed.

Customers qualifying for an exemption from standby charges under Public Utilities (PU) Code Sections 353.1 and 353.3, as described above, must take service on a time-of-use (TOU) schedule in order to receive this exemption until a real-time pricing program, as described in PU Code 353.3, is made available. Once available, customers qualifying for the standby charge exemption must participate in the real-time program referred to above.