by K.T. Weaver, SkyVision Solutions
In 2006, the Victorian Government in Australia mandated the rollout of electricity smart meters to all households and small businesses across Victoria under the Advanced Metering Infrastructure (AMI) program.
Victorians have paid more than $2 billion for the deployment of the smart meters, but there has been “no overall benefit to consumers,” an auditor-general’s report has found.
The majority of benefits that have been claimed since the deployment of smart meters in Victoria relate to the costs avoided for maintaining and manually reading the old “accumulation meters,” but these costs have been replaced by higher costs for smart meters and “does not represent any additional value generated by the AMI program.”
The auditor-general also found just 0.27 per cent of consumers had subscribed to flexible pricing offers associated with smart meters, well below the target of 4 per cent by 2014 and 15 per cent by 2017.
Even though the auditor-general’s report provided the dismal facts related to the costs associated with smart meters, it did, however, unfortunately continue a government promoted narrative that smart meters “might lead” to future benefits to consumers, essentially blaming the current lack of realized benefits on consumers who don’t know how to use the information from smart meters to make the “required behaviour change.”
As stated in the auditor-general report:
“Consumer benefits from smart meters rely on the behaviour and decisions of a number of energy market participants and are derived in a variety of ways, including:
- reduced energy consumption — AMI is intended to provide consumers with the information needed to make direct and informed decisions about their energy use
- flexible tariffs — as customers shift their electricity load from peak to off-peak times, it was expected their electricity costs would decrease because of time-of-use tariffs
- network efficiencies — are intended to be passed on to consumers through a national regulatory approval mechanism.”
“Given that the benefits of smart meters are reliant on considerable consumer action, ensuring that consumers understand how they can use smart meters to their advantage is fundamental to ensuring that benefits are realised. The more engaged consumers are, the greater the potential benefits of the AMI program. Until addressed, resistance to change is expected to remain.”
“Government’s role must now be to help consumers to get the most out of what they have paid for.”
“Achieving [smart meter] benefits relies heavily on the majority of consumers changing behaviour, including by finding a better electricity deal and changing consumption patterns. In this respect, a key role for government is in providing consumers with a better understanding of the benefits that smart meters can provide and encouraging the required behaviour change. Yet despite improvements to consumer education since our 2009 audit, market research conducted in early 2014 found that two-thirds of Victorians do not understand what the benefits provided through smart meters are, and many are still unaware of their ability to help minimise energy bills.”
“Consumer action is a key determinant of any future benefits realisation.”
I find the above statements from the auditor-general quite extraordinary. It means that “benefits” to the consumer are defined in a way that requires significant behavioral changes on the part of the consumer, probably lowering one’s quality of life by reducing overall energy consumption, and, for example, by washing your clothes between midnight and 2 a.m. in the morning. How can that be called a “benefit”?
Although consumers can find ways to use energy more wisely, they don’t need billions of dollars to be spent on smart meters to do that. I can go tomorrow and buy a new energy-efficient appliance if I have the money for that initial investment, and I will later save on energy costs. However, it may not make economic sense for me to buy that appliance if the one I have now works perfectly fine.
It is absurd to continue a narrative that smart meters somehow help consumers save energy as a benefit or for the government to take credit for me going to buy LED light bulbs if it happens to occur subsequent to the installation of a smart meter.
Based upon the technical nonsense related to cost benefit justifications for smart meters, such justifications must be attributed to being nothing more than “political assertions” and propaganda.
And what did the auditor-general have to say about consumers who oppose smart meters and think they are not worth the cost? From the report:
“… A very small number of Victorians still had a negative perception of smart meters due to misinformation and a lack of understanding.”
To the contrary, it is the government bureaucrats responsible for deployment of smart meter systems who suffer from “misinformation and a lack of understanding.”
Source Material for this Article
“Smart meters giving Victorian consumers ‘no benefit’ on electricity bills, auditor-general says,” at http://www.abc.net.au/news/2015-09-16/smart-meters-giving-victorian-consumers-no-benefits/6780566
“Vic smart meters worth $2.2b ignored,” at http://www.news.com.au/national/breaking-news/little-benefit-from-vic-smart-meters/story-e6frfku9-1227529910587
“Smart meters: You paid billions for electricity companies to benefit – report,” at http://www.smh.com.au/business/energy/you-paid-billions-for-electricity-companies-to-benefit–report-20150916-gjnpz7
Victorian Auditor-General’s Office: “Realising the benefits of smart meters” refer to http://apo.org.au/research/realising-benefits-smart-meters and http://www.audit.vic.gov.au/publications/20150916-Smart-Meters/20150916-Smart-Meters.pdf
Typical government M.O. When their plans don’t work, blame the public for being “uneducated.”