And here is this week’s Green numbers:
Photo credit mckaysavage
Despite a lot of talk and some high profile trials the day we have ubiquitous full Smart Grids is still a long way off.
I attended the Smart Grids Europe conference in Amsterdam this week.
It was a great conference, I met a ton of interesting people and had some fascinating conversations.
I can’t help feeling a little deflated though.
I’m a huge advocate of Smart Grids. I gave my first international talk about Smart Grids and demand side management (Demand Response) at the Reboot conference in Copenhagen back in early 2007. We are now a full three years later and many utility companies have yet to roll out smart meter pilot programs.
Others are rolling out smart meters more because of pending of legislative requirements than because of any desire help reduce people’s energy footprints.
In fact, after talking to more utility companies, I suspect that smart grids may not proceed beyond smart meter deployments in some regions. The recent Oracle survey of Utility CxO’s confirms this view
utilities executives put improving service reliability (45 percent) and implementing smart metering (41 percent) at the top of the list [of Smart Grid priorities]
So why the apparent passive aggressive response from the utility companies?
Well, they have to keep the lights on. To paraphrase the old saw, they do not want to ‘fix’ their grid, if it ain’t broke! And, let’s be fair, the idea of investing large sums of money to help their customers use less of their product isn’t one which sits comfortably with them. That’s understandable.
And no utility wants to have the kind of customer blowback that PG&E saw with their botched smart meter rollout in Bakersfield.
But there is a huge global imperative for Smart Grids – the Smart 2020 report said:
Smart grid technologies were the largest opportunity found in the study and could globally reduce 2.03 GtCO2e , worth €79 billion ($124.6 billion).
How then do we square that circle?
We could legislate for them but a better approach would be to change the landscape in which the utility companies operate such that there is a business case for full smart grid deployments.
I suspect the best approach would be the introduction of a carbon tax. This is something we need to do anyway (and the mechanisms for doing so are a topic for a separate post) but if there were a tax on CO2 production, it would be in utility companies (and their customers) interests to cut back on energy consumption.
Even if there were a strong business case for smart grids, given the glacial speeds at which utility companies move, I suspect it is going to be many years before we see full smart grid implementations.
Photo credit svale
What we have got here is a failure to communicate
From the report on the SmartMeters.com site:
a class-action lawsuit has been filed representing thousands that will demand damages from the utility and third-parties also involved in the $2.2 billion project.
Bakersfield residents believe their new smart meters are malfunctioning because their bills are much higher than before. PG&E claims higher bills are due to rate hikes, an unusually warm summer, and customers not shifting demand to off-peak times when rates are lower.
This has to be a huge embarrassment for PG&E and their partners who are spending $2.2 billion on this project.
So what has gone wrong?
A recent report in the New York Times raises speculation that the meters themselves are to blame:
Elizabeth Keogh, a retired social worker in Bakersfield, Calif., who describes herself as “a bit chintzy,” has created a spreadsheet with 26 years of electric bills for her modest house. She decided that her new meter was running too fast.
Ms. Keogh reported to the utility that the meter recorded 646 kilowatt-hours in July, for which she paid $66.50; last year it was 474 kilowatt-hours, or $43.37.
At a hearing in October organized by her state senator, Ms. Keogh took out two rolls of toilet paper — one new, one half used up — and rolled them down the aisle, showing how one turned faster than the other. “Something is wrong here,” she said.
Scores of electric customers with similar complaints have turned out at similar hearings. At one in Fresno, Calif., Leo Margosian, a retired investigator, testified that the new meter logged the consumption of his two-bedroom townhouse at 791 kilowatt-hours in July, up from 236 a year earlier. And he had recently insulated his attic and installed new windows, Mr. Margosian said.
yeah I’m actually pretty pissed, PG&E installed a so called “smart meter” and my utility bill increased $300.
It seems Jeff was having the same problem and his bill was also up significantly over the same month last year.
There are a number of problems here – all to do with transparency and communication.
If, as PG&E say, this is because of “customers not shifting demand to off-peak times when rates are lower”, then it follows that PG&E have either failed to communicate the value of shifting demand or the time when rates are lower.
One of the advantages of a smart grid is that the two way flow of information will allow utilities to alert customers to real-time electricity pricing via an in-home display. PG&E have not rolled out in-home displays with their smart meters, presumably for cost reasons. If they lose the class-action law suit, that may turn out to have been an unwise decision.
Even worse though, in a further post on Twitter, Jeff said:
I’m waited for PG&E to put up the daily usage numbers, I won’t get those until next month for some unexplained reason
This defies belief, frankly.
It seems that PG&E’s smart grid rollout is woefully under-resourced at the back-end. What PG&E should have is a system where customers can see their electrical consumption in real-time (on their phone, on their computer, on their in-home display, etc.) but also, in the same way that credit card companies contact me if purchasing goes out of my normal pattern, PG&E should have a system in place to contact customers whose bills are going seriously out of kilter. Preferably a system which alerts people in realtime if they are consuming too much electricity when the price is high, through their in-home display, via sms,Twitter DM, whatever.
Jeff himself likened this situation to the e-voting debacle where the lack of transparency around the e-voting machines meant the whole process collapsed. In the same way, a lack of open standards around smart meters means we can only trust the smart meter manufacturers and utilities when they tell us that they are operating honestly. That is unlikely to fly.
This debacle has massive implications, not just for PG&E’s $2.2 billion smart meter rollout, but for smart meter projects the world over.
Transparency and communications failures can lead to utilities being sued by their customers, as we have seen with the PG&E example. Not a desirable situation for any company. The PR fallout from the Bakersfield rollout means PG&E will have a much harder time convincing other customers to sign up for smart meters and may potentially set back smart grid projects in California for years.