For today’s company spotlight, I wanted to look at smart meters.
Smart meters have been in use since 2006 in the United States and have gained wide penetration in some areas and caused backlashes in others. In the near future many utilities will be switching their customers over to this technology. So what exactly are smart meters, why are they sometimes controversial, how do they help consumers and utilities save money, and who is the industry leader in the field?
A smart meter is a device that collects electric consumption data from a home or business and communicates that data back to the utility. This communication is accomplished by the use of Radio-Frequency (RF) technology. Smart meters provide several advantages to the customer as they allow the customer to monitor their energy use in real time and allow for the customer to receive real versus estimated electric bills. For the utilities there are several major benefits as well. Primary among these is that smart meters allow the utility to adjust its billing policies to entice customers to use electricity during non-peak hours. This is vital as during peak electric usage periods the utilities must bring on-line less efficient energy methods or purchase power from other entities. Both of these methods increase costs to the utility. Incentivizing customers to adjust their energy use to off-peak hours helps the utilities keep costs down and potentially produce electricity using more environmentally-friendly methods. A good example of this approach can be seen with TXU Energy’s Free Nights program which is designed to encourage customers to change their electricity usage habits and as a reward not be billed for electricity usage between 10 PM and 6 AM, non-peak hours for the utility. Another use of smart meters is that they allow utilities to more quickly respond to power outages or problems as they are now receiving almost real time information from customers.
The level of penetration of smart meters in the United States varies dramatically by region of the country. PG&E just recently announced that it had installed its