Business

Saturday, Oct 06 2012 09:00 PM

Smart meters entering new phase of usefulness

BY JOHN COX Californian staff writer jcox@bakersfield.com

Six years and many missteps later, smart meters may soon become more convenient, even helpful, for local customers of Pacific Gas and Electric Co.

This month the company unveiled a pair of initiatives that would tap wireless technology that until now has lain dormant inside the digital devices better known in Bakersfield as a source of some customer frustration.

The programs have near and long-term benefits: first, the availability of in-home monitors that display customer energy use in real time; second, the ability to control -- remotely by cell phone -- "smart" air-conditioners and other appliances.

Just think of the possibilities. You're an hour from getting off work, so you grab your smartphone and turn on your home air-conditioning or heater.

Or, say you can't remember whether you turned off the coffee maker before leaving for work. An app on your cell phone can tell you, and allow you to turn it off remotely.

"We're taking steps to realizing the home of the future," PG&E spokesman Greg Snapper said.

PG&E has worked with outside companies to help develop the in-home monitors, expected to be available to 5,000 of its customers by the end of next year.

Except for a remote air-conditioning app, the San Francisco-based utility is not working on smart appliance development itself; it's leaving that work to outside companies.

This month it introduced a so-called "Green Button" option that allows customers to route their energy use data to companies working on smartphone apps. In doing so, PG&E joined some three dozen utilities across the country to embrace the Green Button.

Industry research suggests consumers and manufacturers are on the verge of embracing smart meter-enabled appliances. A recent report by PikeResearch predicted that worldwide sales of smart appliances -- everything from cell phone-controlled washing machines to toasters -- will total nearly 45 million units by 2020.

Such use of wireless home area networks and smart appliances has long been a promise of smart phones, which PG&E introduced in Bakersfield in 2006 and now exist in nearly 8 million customers homes and businesses across the utility's territory.

Smart meters had a rough reception locally. PG&E's first generation of the devices in Bakersfield contained technological shortcomings that required an expensive upgrade. They also came with a rate hike that contributed to steep bill increases.

Although a state-commissioned study ultimately found that the devices were reporting energy use accurately, PG&E has acknowledged various glitches and issued a public apology over its handling of smart meters.

Until now, the meters have primarily been helpful in that they allow customers to check their energy use online throughout the day. PG&E says this alone is a big benefit because it arms ratepayers with information that lets them monitor their consumption habits, which helps them identify ways to conserve energy and lower their monthly bills.

More work ahead

Even with the new applications, smart meters have not yet delivered on a key benefit the utility industry has been talking about for years: time-of-use pricing.

The idea is that because smart meters report electricity use in real time, they allow utilities to charge customers rates that vary according to when energy is consumed. Many businesses have already transitioned to this system, but most residential ratepayers continue to pay flat rates that do not reflect PG&E's true costs.

The lag in implementing such rates on a wider basis is partly beyond PG&E's control. Consumer advocates have argued against the idea because customers who don't manage their energy use properly could end up paying higher bills under such a system.

At any rate, the new home area networks -- the wireless system that lets people keep a closer eye on their energy use -- bring the utility closer to being able to offer time-of-use pricing.

Some say there is reason to be skeptical of the new smart meter-enabled devices.

For one thing, utilities need to work closely with customers to demonstrate the benefits, utility industry consultant Ahmad Faruqui wrote in an email.

"The technology by itself won't do much unless people access the information and act on it," he wrote.

Mindy Spatt, a spokeswoman for San Francisco-based consumer advocacy group TURN, noted that the devices won't save money all by themselves.

"At the end of the day, the one thing that customers can do to lower their bills and save energy is to use less," she said. "No matter how many devices they purchase, they'll have the same options for using less energy.

"Substitute a clothes line for your clothes dryer. That saves money."

Spatt also took issue with a decision by the California Public Utilities Commission to let PG&E and the state's other investor-owned utilities charge customers for its customer outreach relating to smart meter-enabled devices. She noted that these devices will ultimately profit manufacturers.

"We don't think that a customer-funded education program is the right way to sell those (home area networks)," she said.

The home area networks PG&E plans to make available to up to 500 customers starting in January also have one key shortcoming. Snapper, the PG&E spokesman, said the prices they display will reflect only flat rates, not the tiered rates that rise the more energy customers use.

Without that capability, the first-generation home area network displays won't be able to notify customers when they should aggressively cut back energy use to avoid paying higher per-unit costs.

PG&E maintains that the various devices that draw upon smart phones' wireless technology will ultimately empower consumers to make wise decisions.

"These technologies do have a potential to bring a whole other level of understanding of how energy is used and how much it costs," Snapper said.

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