The lack of a consistent market architecture and design paradigm shift creates a Babel Tower in Ontario. There is a need to consider the whole power industry and not isolated incremental shifts making like risky bets of installing “smart meters in all homes in the province.”

To BE or NOT to BE Smart Metering

By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity

Copyright © 2007 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.

Dec. 15 update begins:

Jamie, Andrea and Len,

Objective data and subjective perceptions are two realms, which follow very different logics. Objective data can be extrapolated; subjective perceptions cannot in this case.

Jamie and Andrea’s thesis is precisely that “A primary driver of the trend is a green gap between terms and messaging commonly used in the energy and environment space and consumer’s actual understanding, acceptance and perceptions of value connected to these terms.”

As Demand Integration is NOT the Province of Politics (please hit link to read this article and the one below), the institution able to fill the gap, under EWPC, is the Second Generation Retailer - 2GR.

By developing business model innovations to integrate demand, 2GR will develop service plans with the needed messaging to close the green gap for customers to make the best decisions about value in the competitive market about the investment and service plan decisions. For example, how much short run demand response and how much long run demand response (demand side energy efficiency) to purchase in the marketplace.

Update ends.

One case in point about a green gap is in today’s Energy Central Daily news. Ontario should get smart, follow Hydro Quebec decision to abandon time-of-use meters, electricity coalition says. "The Ontario government would be doing consumers a favour if it were to follow the example of Hydro Quebec and abandon its plan to install so-called smart meters in all homes in the province, says the Ontario Electricity Coalition."

“… Hydro Quebec has decided that the expense of installing the meters would be borne by consumers through higher electricity rates…”

"Time-of-use meters are less about energy conservation and more about raising the cost of electricity to pay for private power generation,"

"There is little evidence that smart meters will reduce electricity consumption and plenty of evidence that prices will increase. The cost of installation alone in Ontario is more than $2 billion," he said. "There really is nothing smart about basing an energy plan on time-use-meters in Ontario homes… That money would be better spent on an effective energy conservation plan."

The lack of a consistent market architecture and design paradigm shift creates such a Babel Tower. There is a need to consider the whole power industry and not isolated incremental shifts like installing “smart meters in all homes in the province.”

Under EWPC, demand integration (as explained in the above post) is about both energy conservation and reducing the cost of electricity by developing demand elasticity with efficient pricing.

There is a great risk that the smart meters bet made by regulators and utilities will result in a price increase for customers. Those risks are better handled through the market by competitive 2GRs service plans that combine interdependent decisions on investments by customers. In addition, instead of installing meters in all homes, it is more efficient to do it during a transition period under competition.

Reference and context: The Green Gap in Communications and Messaging, by Jamie Wimberly, CEO, EcoAlign and Andrea Fabbri, COO and Chief Marketing Officer, EcoAlign