Smart Meter Fate Undecided

By Nicholas Zifcak
Nicholas Zifcak
Nicholas Zifcak
August 3, 2010 Updated: August 3, 2010

Now is a critical time for smart energy meters. The federal government has put up funding for projects around the country to install smart meters. Homeowner energy customers have little say in whether or not their utility provider will invest the customer’s money in the new meters. Local utility regulatory boards will make the final decision. But whether or not a majority of homeowners will embrace and make use of the new meters is yet to be seen.

Smart energy meters can provide consumers with detailed information about energy use, sometimes with real-time sensors measuring how much energy consumers are using throughout the day. The goal is to provide users with more information that relates energy use to cost, giving users more incentive to reduce usage.

Last October Obama announced Department of Energy stimulus grants totaling $3.4 billion dollars. The money went to 100 private companies, utilities, manufacturers, and cities to help fund smart grid upgrades. The grants were awarded for power grid upgrades, job creation, and as a way to empower consumers to regulate energy use.

Cutting consumer energy use was not the sole purpose of the funding, but an expected outcome.

In fact, failure to sufficiently take the customer into account is holding up one of the largest of the DOE funded projects. Baltimore Gas and Electric’s (BGE) smart meter implementation proposal for their service region was rejected by the Maryland Public Service Commission. The commission found the proposal cost consumers too much, especially since savings down the road are unverified.

The Department of Energy said that if BGE’s project did not move forward by July 30 it would rescind the $200 million. That date has come and gone and DOE does not appear to have taken the money back. After the Maryland Public Service Commission rejected BGE’s initial proposal, BGE submitted a revised proposal in mid July. The Public Service Commission has scheduled a hearing for that proposal for Thursday Aug. 5. BGE did not return a call requesting comment.

Billions of federal stimulus dollars have been awarded to pilot smart meter programs around the country. The success or failure of these programs to win over energy customers is critical for broader smart meter implementation.

But some have questioned whether utility companies, who make money selling energy to consumers, do not have an inherent conflict of interest when it comes to reducing energy consumption and increasing efficiency. Whether smart meters will actually empower consumers to cut energy use and energy costs remains to be seen.