Sunday, June 20, 2010

Smart meters come to Cincinnati. Will you benefit?

Duke Energy has started to roll out implementation of smart meters throughout the Cincinnati metro area. Terrace Park was a "pre-deployment" site in December 2009, but installation began in earnest this year and will move out to the suburbs over the next few years.
  • See the Duke deployment map here
Much has been made over the past couple of years about smart meters and the smart grid (the meters being just a small component towards the smart grid). One of the overarching goals being more effective management of electricity usage and distribution. From the utility's perspective, use of smart meters will help predict when they will need to purchase electricity from another provider to meet demand and defer the need to build more generation plants. Presumably, the ability to better manage overall distribution and usage will help control costs in future years.

From a consumer's perspective, the smart meter should allow you to better monitor your usage throughout the month and perhaps make adjustments to reduce your bill. Other touted benefits include the ability to identify and target outages more quickly.
While not part of the current deployment, a controversial aspect of the smart grid is that it will prompt some variation of "dynamic pricing" based more directly on supply and demand rather than simple flat rates. For example, utilities may have higher prices for electricity used during a hot summer day when AC usage causes the greatest demand. The idea being that consumers and businesses will move non-essential power needs to other times of the day - such as running a dishwasher at night rather than during the day. Some utility companies such as Pacific Gas & Electric (PG&E) have already conducted pilot efforts and are beginning to sign up business customers on approved programs.

In a coordinated move, manufacturers are looking at the development of "programmable" appliances and equipment. Some scenarios where this could occur might be a washer and dryer that only operates when the cost of electricity is at "non-peak rates" or your thermostat automatically adjusts if rates go above a certain amount. This would require two-way communication between the utility and the home which is possible today, but will likely take a few years before it moves beyond the development and test stage.

So, bottom line? We probably won't see any immediate savings. The most likely scenario is that electricity costs will rise more slowly than in years past - perhaps running less than the overall inflation rate. Should dynamic pricing be implemented, those who are willing to modify their behavior and adapt usage to non-peak periods should be able to benefit the most.

No comments: