A “Smarter” Grid Will Lead to a Smarter Consumer

It’s been said that if Thomas Edison came back from the dead, he would look at our electric grid, scratch his head and state that not much had changed in the 79 years since his death. The fact that our electric distribution and transmission grid needs to move from the electromechanical, analog age to the digital era is not in dispute.

But that move comes with a cost. For consumers, it appears that what’s in the “smart grid” for them is nothing other than a monthly surcharge on their electric bills. For 11 years, Oncor customers in Texas will be paying $2.19 per month for their smart meters.  Doesn’t sound like much, but it adds up to $298.08 per household. For many consumers, the “smart grid” appears merely to add several dollars a month to their electric bill.

However, in the long run, consumers should benefit from improved service reliability as utilities improve their sensing and monitoring capabilities with digital technology. It’s not uncommon to find an electromechanical meter as old as the house it monitors. Many of these meters are decades old. Often, after an older meter is replaced with a smart meter, consumers see higher bills. The reason? The older electromechanical meters were measuring energy usage with worn parts. As a result, consumers weren’t getting billed for all they energy they used.

Eventually consumers will have the ability to monitor and adjust their energy consumption and thus have some control over their monthly bill.  Utilities will likely implement “time of use” pricing–increasing prices during peak demand times to motivate consumers to use less electricity.  For instance, if consumers have to pay more to run their washers and dryers before 6 p.m. on weekdays but pay less to run them later in the evening, they’d be more likely to do laundry at night. If it works as expected, “time of use” pricing would lead to a reduction in the number of power plants necessary to meet increasing peak demands, thus helping the environment. Theoretically, reducing the investment needed to build new power plants would also help utilities keep the price consumers are charged for electricity under control.

How will the capability to monitor and manage electric usage be put into the hands of consumers?  And more importantly, who will provide this ability?  Monitoring capabilities will require HVAC systems, appliances, pool pumps, hot water heaters and so on, to be “smarter” than they are today if they are to allow consumers or electricity providers to “manage” them. Eventually, consumers will expect to:

  • control these objects remotely through an app on their mobile phone,
  • be able to see near real time information regarding their electricity usage, and
  • receive notifications of peak pricing events.

I’m thinking this sounds a bit like the information your carrier already provides for you in terms of your mobile phone—such as voice, text and data usage, as well as any alerts you get as you approach your monthly limits.

Bringing consumers to the point that they care enough about their electric bills to spend time “managing consumption” will require a paradigm shift, but I’ll save that topic for another blog.

What other items do you feel could benefit by being “smarter?”
Have you converted your home or office over to Smart Technology and want to share the experience?
Rita Mix Utility Industry Lead Marketing Manager AT&T About Rita