Smartening the Smart Grid

This year's annual New York press briefing by the Edison Electric Institute, the organization representing investor-owned utilities, naturally was devoted to the smart grid, the hot topic of the day. Most notable, actually, was the absence of anything really new to report, which confirmed expectations that the smart grid will begin to prove itself next year at the earliest--or not.

This was not the first EEI briefing devoted to smart grid prospects. Last year's briefing was devoted almost entirely to the smart meter avalanche, and a year or two before that much was made of Xcel Energy's SmartGridCity experiment in Boulder, Colorado. I reminded EEI president Thomas Kuhn of the Boulder briefing and pointed out that the experiment appears now to have been a failure. Kuhn did not dispute that and said it appears the problem in Boulder was that the target population was just too affluent: Despite the known green-mindedness of Boulderites, a major factor in Xcel's selecting the small city for its smart grid test run, it seems most of them do not care all that much about the modest monetary savings they stand to make from paying attention to electricity usage signals.

That message, not good news for the smart grid, strongly suggests that its success will depend heavily on the quality of customer communications. "Utilities now really need for customers to listen," says Christy Murfitt, senior manager for solutions marketing with Nuance Communications. How do you get ratepayers to pay attention? The main thing is to stress green mindedness and potential monetary savings, says Christy, but appeals to community values and making advantages as tangible as possible--not to mention, where possible, offering rebates--also help.

Nuance, with major utility customers across the United States and Canada, has been showing its clients how to use billing alerts to start educating their customers about peak versus off-peak rates, the major factors causing their bills to go up or down, and how they can best use their major appliances to minimize costs. Though real-time interactive communications based on hour-to-hour rates changes are only starting to be developed, says Christy, payment schemes can be arranged where customers are warned it their usage exceeds pre-agreed-upon thresholds.

Globally, smart grid investments are expected to be about $90 billion this year, according to a recent report. Infrastructure investments, including communications, represent the overwhelming bulk of that, and customer-side investments, mainly smart meters, only about 20 percent. But the customer-oriented expenditures are a fast-growing share and will be critical to whether the smart grid is seen as a success or failure, comments David Cappello, the main author of the SBI report.

However far electricity restructuring, deregulation, and privatization go, electric power will always be seen in the last analysis as a public service. The public has been led to believe that the smart grid will produce monetary savings and carbon cuts, and so, if those gains do not materialize fast enough, many states no doubt will step in and pass laws insisting that utilities produce tangible results.

Advertisement

Newsletter Sign Up

Sign up for the EnergyWise newsletter and get biweekly news on the power & energy industry, green technology, and conservation delivered directly to your inbox.

Advertisement