by K.T. Weaver, SkyVision Solutions
On July 30, 2015, the New Hampshire Public Utilities Commission issued an ‘order of notice’ commencing an investigation into grid modernization in New Hampshire. In response to that order, Eversource Energy (formerly known as Northeast Utilities) provided comments on September 17, 2015. As stated by intelligentutility.com:
“While smart meters or AMI meters are often equated with grid modernization, Eversource does not see them as necessary. In fact, the company says that it has found customers are not very interested in moderating energy use based on time-varying or dynamic rates.”
The position put forward by Eversource Energy is reminiscent of the original intent of the Energy Policy Act of 2005 which contained language that required utility commissions and utilities to consider whether it is appropriate for utilities to offer customers smart metering for those who request it.
SkyVisions Solutions has reviewed the comments submitted by Eversource Energy to the New Hampshire Public Utilities Commission. This article primarily presents selected quotations from those comments as they apply to smart metering and time varying rate (‘TVR’) programs.
Key Points from Eversource Energy Comments
“Eversource does not believe smart meters and/or AMI are key enabling investments for the future of the modernized grid. As demonstrated by Eversource’s plan in Massachusetts, there are many more cost effective technologies that can help meet the grid modernization objectives that Eversource considers to be key in any modernization program.”
“Key Operational Benefits from an AMI Deployment are Insufficient. Eversource’s analysis also indicates that the incremental operational benefits of moving to an AMI platform are insufficient to warrant the increased cost.”
“[T]here are many factors that support Eversource’s proposal to focus on an opt-in of [time varying rate] TVR program instead of an opt-out TVR program. But most importantly, a strong opt-in TVR program will provide for a much better customer experience and satisfaction as customers will be presented with an option to participate and control their energy costs. In an opt-out program, customer experience will be negatively impacted as many customers will feel dissatisfaction at having [been] placed in a program without any opportunity to participate in the decision-making process.”
Smart Meters Not Cost Effective
“In addition to the legal and logistical issues related to the deployment of Advanced Metering Infrastructure (‘AMI’) in New Hampshire, Eversource believes that a broad-based deployment, or a multi-stage roll-out, of smart meters or AMI is not cost-effective for New Hampshire customers. In its recently submitted grid modernization plan in Massachusetts, Eversource conducted a careful analysis of the costs and benefits of a broad deployment of AMI and found such deployment to be highly cost ineffective.
On the cost side, AMI deployments experience a set of high fixed upfront costs beyond the smart meters themselves. Investments in communications (including cybersecurity and data privacy) that are substantially greater than would be otherwise needed achieve a modernized grid, meter data management, billing, and other IT systems are required before benefits can be accrued and these investments can and do take years to actually implement. In addition, there are significant O&M costs required to manage the systems and the data provided by AMI. Finally, there might be other alternatives that could leverage third-party investments in communication technologies that could provide similar capabilities to AMI but at lower costs to our customers.
On the benefit side, several of the benefits that AMI can provide require making assumptions about customer behavior that are highly uncertain. Pilot programs have shown that residential customers who engage in dynamic pricing do shift load in response to price signals and that the response is stronger when linked to smart thermostats. However, pilot results also show that customer interest and engagement is very low. Data analyzed by Eversource indicates that consistently across relevant dynamic pricing pilots offered in the United States, fewer than 25 percent of customers sign-up for these new rate structures. These pilots indicate that low adoption is not the failing of marketing materials or the limits of technology, but indeed that few customers are interested in these types of time varying rate (‘TVR’) structures.
As one example, Eversource in Massachusetts conducted a dynamic pricing pilot that showed that although customer interest in the pilot was relatively strong initially, it was very challenging to convert initial interest into participation in the pilot and then sustain the interest over time. The pilot findings included that out of the 53,000 customers contacted initially regarding participation, only 1,549 were enrolled in the pilot at the end of 2013, a 3 percent response rate. Similarly in Connecticut, a pilot conducted by Eversource also showed that the peak load impacts were gathered from only 3.1 percent of residential customers contacted.”
Most Residential Customers Do Not Have Sufficient Load to Shift to Benefit from a TVR Program
“The benefit of an opt-out TVR program and [a full] AMI implementation will not be realized unless there is an aggregate response that actually reduces customer load on peak at system level on a material basis. Residential customers do not have the large discretionary load to shift in order to have a material impact on the … peak system load.”
“TVR Programs can negatively impact low income customers and those customers who cannot shift load due to medical or other conditions.”
“Air conditioners offer the greatest opportunity for residential load reductions, but the estimated central air conditioning (‘A/C’) penetration in Eversource’s service territory is only approximately 38 percent with 2 to 3 months of use per year, compared to higher penetrations in warmer states, such as Maryland, which have 60 to 80 percent A/C penetration rate thus offering the opportunity for more significant load reductions.”
“Moreover, residential appliance data suggests that there is little discretionary load beyond the air conditioner. This is illustrated in Table 15 – Typical Load in 4-bedroom Home with Central A/C, which shows appliance usage in a typical 4-bedroom home. Central air-conditioning represents more than half of the household load. Lighting represents the second highest share. During peak hours, the air conditioning share of load will be even higher because lighting usage and other appliances are not likely to be in full use.” [See table below.]
A careful review of the above table exposes the false narrative of the smart grid industry that consumers will be able to save money by doing their laundry between midnight and 2 a.m. as an example. In fact, even if some consumers made this inconvenient and irrational behavior modification, the substantially higher rates paid during peak periods during the day for other the non-discretionary energy loads would not measurably be offset by these slight changes in overall energy usage patterns.
Recommended Metering Approach
“[T]he Company is proposing an opt-in TVR Program for all residential and small commercial and industrial customers.”
“The current metering technology in general use for residential and small commercial customers records a single total kWh consumption value which is then collected via drive-by Automated Meter Reading (‘AMR’) on a monthly basis. In order to fulfill the metering requirements needed for either of the proposed opt-in TVR rate options (TOU/CPP or targeted TOU), customer consumption will need to be recorded in either hourly or sub-hourly interval lengths via a more advanced meter than the basic AMR meter, currently in use.”
“For customers who opt in to either the proposed TOU/CPP or Targeted TOU rate, the Company will install different metering equipment depending on the customers’ needs. The selection of which communications options best fits customers’ needs will depend on the availability of the communications infrastructure with the lowest overall costs.”
Summary
In summary, the comments filed by Eversource Energy reflect nearly the same perspective voiced by SkyVision Solutions over the past couple of years:
- The broad-based deployment of smart meters is not cost effective, especially when one considers the costs associated with the additional required communications infrastructure, data storage and other IT systems, cybersecurity, and data management controls.
- The vast majority of residential customers do not have sufficient load available to shift to off-peak periods to benefit from time-of-use rates. This is different from large commercial customers which typically have industrial equipment-type loads and which can likely significantly alter work and product line schedules to take advantage of time varying rates.
- For those residential customers who want time varying rates, let them take advantage of so-called smart metering as outlined by the Energy Policy Act of 2005 on an opt-in basis. There is no need (or net benefit) for smart meters being provided to anyone else.
The Eversource Energy comments were substantiated with facts and figures. Let’s hope other utilities read them, study them, and decide to change course away from the misguided and costly mindset that everyone needs a “smart” meter.
Source Material for this Article
Docket No. DE 15-296, Electric Distribution Utilities Investigation into Grid Modernization for New Hampshire, Eversource Energy comments, September 17, 2015, available at https://www.puc.nh.gov/Regulatory/Docketbk/2015/15-296/LETTERS-MEMOS-TARIFFS/15-296%202015-09-17%20EVERSOURCE%20COMMENT.PDF
“New Hampshire utilities grapple with confusion over ‘grid modernization’” at http://www.intelligentutility.com/article/15/09/new-hampshire-utilities-grapple-confusion-over-grid-modernization
Updated, October 7, 2015: It appears the above article link is no longer valid. Here is an archived version: http://web.archive.org/web/20150930220638/http://www.intelligentutility.com/article/15/09/new-hampshire-utilities-grapple-confusion-over-grid-modernization
New Hampshire utilities grapple with confusion over ‘grid modernization’, Public Power Daily, by the American Public Power Association (APPA), at https://www.publicpower.org/media/daily/ArticleDetail.cfm?ItemNumber=44562
Updated, October 30, 2018: It appears the above article link is no longer valid. Here is an archived version: https://web.archive.org/web/20151010031632/https://www.publicpower.org/media/daily/ArticleDetail.cfm?ItemNumber=44562
State of New Hampshire Public Utilities Commission, IR 15-296, Electric Distribution Utilities; Investigation into Grid Modernization, “Order of Notice,” July 30, 2015, available at https://www.puc.nh.gov/Regulatory/Docketbk/2015/15-296/INITIAL%20FILING%20-%20PETITION/15-296%202015-07-30%20ORDER%20OF%20NOTICE.PDF
Smart Grid Awareness 
Pingback: 'Smart' Meters Not Necessary to Modernize the Electric Grid, Says a Major U.S. Utility
“The current metering technology in general use for residential and small commercial customers records a single total kWh consumption value which is then collected via drive-by Automated Meter Reading (‘AMR’) on a monthly basis.”
I wonder about that, about how often their meters are transmitting. TEP in Tucson has AMR — and I think (but am not certain) — that they collect the info via drive-by. But here’s the thing, they have admitted their meters are transmitting every 30 seconds! That’s more than most APS meters. I really do not understand the point of that if they are collecting monthly.
There are two basic types of AMR meters. Some transmit only in response to a “wake-up” signal from a passing handheld reader or utility vehicle, which occurs perhaps once a month. Other AMRs are referred to as “bubble-up” in that they typically transmit a signal every few seconds around the clock even though the utility reader will only pass by once per month to catch the signal. I don’t know which type Eversource uses in New Hampshire.
Generally the AMR meters are quite low in RF power output in comparison to “smart” meters, but each model would need to be evaluated for those concerned with wireless emissions both from a perspective of power output and whether the AMR model is of the wake-up or bubble-up variety.
In this article it is a positive development that a large utility provides validation that smart meters are not needed to modernize the grid which largely addresses concerns over unnecessary costs, invasions of privacy, and cybersecurity threats. Eversource only supports an opt-in approach for TOU rates. But it is true that Eversource’s specific strategy does not directly or consciously address concerns over wireless emissions.
My understanding of the Eversource perspective in New Hampshire is that it is already in the process of completing installation of AMR type meters for all customers and sees it as a complete waste of money to now replace that technology with AMI. The main advantage of AMI is being able to charge TOU rates but Eversource rightly sees little customer interest in that. Therefore it just wants to provide smart meters to customers who want TOU rates. Since there would be no mesh network like for full deployment situations, Eversource would likely use a meter equipped with a cellular phone-type module that performs the necessary 2-way communications with possible control of appliances for those people opt-ing in. The Eversource strategy would be a more financially cost effective system that caters to the customer in terms of energy needs, but under the Eversource plan everyone would still get a wireless meter of some type, an AMR for most customers and an AMI-type meter for those opting in to time varying rates.
Dear Readers,
As time goes by you will all see that the dopy Electric Microwave A.M.I and actually Far from Smart Meters are not smart in any way at all. This also applies to the Microwave so-called Smart Water and Gas Meters, also not SMART either. Fancy having a dopy Microwave A.M.I Gas so-called Smart Meter. If you do have one of these idiot machines on your Gas Meter it won’t be long if the Insurance Industry is really sensible, that they will ban your home and contents Fire Insurance. That’s what I’d do if I were in charge of an Insurance Company even for anyone having a dopy Electric A.M.I Microwave broadcasting and receiving machine.
No folks, the Smart Meters were primarily brought in to do the Electric and Water and Gas Reader Men out of a job and to rip you all off PRICE-WISE. That’s what we in Victoria and other States of Australia are finding out. I am fortunate as I’ve padlocked my Electric Meter Box and soon to padlock my Water and Gas meter in the next few days. There are now over 90,000 of us here in Victoria Australia who have Padlocked our Electric Meter Boxes and the number is increasing.
The dopy Electric Company for my area threatened to force an Idiotic Smart Electric Meter on me, so I sent them a very polite, but strongly worded Letter ,stating that for Health and Safety and Privacy reasons I am refusing them permission to put this machine on my home property and I will SUE the C.E.O of this Electric Power Company Ten Million Dollars $10,000,000 Dollars with the Anti Harassment Lawful Notice from Canberra and the support of my barrister and the A.C.C.C Lawyers who have promised to help me.
This Electric Power Company only had 14 days in which to contact me in WRITING and they have never contacted me. Some four (4) years ago I sent my strong letter of refusal for the far from Smart Meter and the A.C.C.C Anti Harassment ten million dollar notice to them by Registered post back in 2011. This means that they have to abide by the full terms in this Anti-Harassment Notice of Fine or the A.C.C.C and my barrister in concert will drag these C.E.O’s and their Corrupt lawyer before the High Court. This the C.E.O and his Lawyer now understands, that I am very serious indeed.
Like the Coward I allege he is, this C.E.O is not game to challenge me or my barrister or the A.C.C.C Lawyers from Canberra. We are supposed to living in what is a DEMOCRACY and not A Police State … After all, Democracy means a government, “Run By by The People and For the People and By the People,” but these I allege to be, Evil Extortioners, these C.E.O’s in the five Electric Power Companies here in Victoria Australia seem not to understand these Facts on which Democracy is based.