Is New Hampshire ‘smart meter’ ready?
There’s no shortage of political rhetoric about the anticipated “green revolution” of alternative energy development and increased conservation — especially now that President Obama has made them a vital part of his domestic policy agenda, not only to promote economic growth but to stem the tide of global climate change.
“To accelerate the creation of a clean energy economy, we will double our capacity to generate alternative sources of energy like wind, solar and biofuels over the next three years,” Obama said in a recent radio address touting his $825 billion economic stimulus package. “We’ll begin to build a new electricity grid that will lay down more than 3,000 miles of transmission lines to convey this new energy from coast to coast.”
In addition to infrastructure enhancements like additional transmission lines, Obama has called for the installation of more than 40 million smart meters in American homes and a temporary $100 billion program to help finance new renewable energy projects.
Advocates say smart meters — which have radio capabilities to provide two-way communication with the utility and devices within the home — could lead to significant energy efficiency and conservation increases by giving consumers near real-time information about their usage. The goal is behavior modification by matching usage with costs, not unlike the way consumers track cell phone use and costs in real time.
The unknown variables are how much and how fast all this development will come, how costly it will prove to be and what technologies will be appropriate for the immediate future.
What is less publicized is how these grand plans depend heavily on hundreds of billions of dollars in investments to transform the national electric grid (to allow for the integration of expanded wind, solar and other alternative energy sources) and install such technological innovations as the 40 million smart meters Obama is proposing.
Gary Long, president of Public Service of New Hampshire, has seen promises of alternative energy development come and go for the past three decades — since President Jimmy Carter made it a top domestic priority in 1977, in fact.
Long believes Obama is doing the right thing but may be taking the wrong approach.
“We need to define what our goals are,” said Long, who has extensive experience in electric metering development and implementation. “There are a lot of ways to accomplish our goals (of alternative energy development and conservation) without a massive infrastructure change or smart meters.”
While Carter called transforming the nation’s energy policy in the 1970s “the moral equivalent of war,” he failed to fully get the public or Congress behind him. Obama is using the bully pulpit and promising massive federal intervention. But Long believes that moving too fast with unproven technologies will be counter productive.
“We can do a lot with conservation and energy efficiency and by expanding alternative energy projects and decentralizing the current grid,” Long said. He doesn’t believe the country is ready yet for massive installations because previous attempts to garner consumer participation have yielded “disappointing results.”
The reason the Obama administration is making such a push for residential smart meters is that many believe they are a key to long-term conservation and efficiency and consumer cost savings.
The focus on smart meters could prove to be one of the most important keys in long-term conservation because it will have the most direct impact on — and potential control by — consumers.
A smart meter “allows a home network to be created to inform the homeowner of their current electricity usage, provide messages from the utility, inform the user of higher electricity demand and even allow devices in the home to be managed to reduce their electricity consumption at peak times,” said Skip Ashton of Ember, a Boston-based company that develops the underlying radio chips, networking software and application codes used in smart meters.
While New Hampshire has no residential installations or ongoing pilot programs – although the Hannaford supermarket chain uses a smart meter approach to controlling energy costs — Texas has become one of the largest smart meter laboratories in the country, with little or no prodding by the federal government.
The Dallas-based utility Oncor has embarked on a $690 million project to install 3 million smart meters over the next four years. Jim Greer, Oncor’s senior vice president of asset management, has no doubt about their importance or effectiveness.
“Advanced metering systems are fundamental for our future and critical for the state as an economic engine,” he said.
Oncor households will pay for the program at the rate of $2.22 a month over the next 11 years — a cost recovery mechanism allowed by a 2005 Texas law. But Greer said he believes that if utilized properly, the new system will generate much higher conservation savings, ranging from 6 percent to 15 percent annually.
Greer believes the conservation savings alone could result in two to three fewer planned CO2-emitting coal-burning power plants to handle the expected energy demand increase over the next two decades.
But Long said Oncor and other smart meter advocates are pushing too far ahead of what consumers need and want. “If they are successful, I’ll be surprised,” he said.
Long said PSNH will learn a lot from a smart meter pilot program for 3,000 commercial, industrial and residential customers being conducted by one of its sister companies in Connecticut.
The goal of the plan, Long said, is to understand customer interest in, and response to, peak-time-based rates by giving a choice of three time-based rate options. Connecticut Light & Power will make a smart meter recommendation and report its results to the state Department of Public Utility Control at the end of 2009.
To help customers make smart meters successful, Greer said Oncor has embarked on a massive consumer education project.
Education is the key, he said, because the smart meter concept “is so foreign that most people don’t have a clue what advanced metering systems will mean to them.”
Massachusetts lawmakers passed legislation last year to jump-start a smart meter pilot program beginning this year.
Tom Franz, electricity director at the state Public Utilities Commission, said the state is preparing a major study in energy efficiency and is looking closely at smart-meter pilot programs taking place across the country. The PUC also is working with each utility in the state to develop smart-meter plans for the future.
“There are policy choices we have to face and there is big potential in how we can better utilize our systems,” Franz said.
One thing most people agree on is that the Obama administration’s emphasis and promise of major federal dollars have opened doors that were barely ajar during the Bush administration.
Caroline Allen, spokeswoman with NSTAR, one of the largest electricity providers in Massachusetts, said, “Anything that defrays the costs would be beneficial in getting new technologies in place. Consistent with other energy policies like renewable energy and energy efficiency, investments in the grid and emerging smart grid programs will only help move things along.”