ACEEE Study: Smart Meters Not Enough to Save Energy, Money

A study released last week by the nonprofit American Council for an Energy-Efficient Economy (ACEEE) concludes that smart metering initiatives alone are not enough to save energy.

The report, titled “Advanced Metering Initiatives and Residential Feedback Programs: A Meta-Review for Household Electricity-Saving Opportunities,” found that consumers could cut their household electricity use as much as 12% and save $35 billion or more over the next 20 years if U.S. utilities go beyond simple "smart meter" initiatives to include a wide range of energy-use feedback tools.

ACEEE based its findings on a review of 57 different residential sector feedback programs between 1974 and 2010. The group concludes: "Advanced metering initiatives alone are neither necessary nor sufficient for providing households with the feedback that they need to achieve energy saving; however, they do offer important opportunities. To realize potential feedback-induced savings, advanced meters must be used in conjunction with in-home (or on-line) displays and well-designed programs that successfully inform, engage, empower, and motivate people."

ACEEE found that three of the most promising approaches in the short to medium term include enhanced billing, daily/weekly feedback, and "off line" and Web-based real-time feedback. However, far-reaching programs that go beyond "smart meters" are few and far between. According to ACEEE, no U.S. utilities are currently providing the full range of needed services.

"The bottom line here is very simple: Smart meters in and of themselves are just not ‘smart’ enough to get the job done for consumers and our economy,” said John A. "Skip" Laitner, ACEEE director for economic and social analysis. “While advanced metering provides a useful tool, to save energy, cut consumer electric bills and reduce greenhouse gas emissions from power plants, utilities need to use these advanced meters to provide consumers with information on their consumption in ways that grab consumers’ attention and encourage them to take action.”

The report’s release follows a decision by the Maryland Public Service Commission to deny Baltimore Gas & Electric Co.’s application to deploy smart meters because ratepayers would be saddled with financial and technological risks. The utility had been the recipient of $200 million in federal stimulus funds—the largest amount awarded to a utility.

Lead report author Karen Ehrhardt-Martinez said that rather than simply presenting consumers with information about the amount of energy consumed during the past month, enhanced billing programs in the short term can provide a context in which consumers can evaluate their consumption levels and give expert recommendations about the best approaches for reducing energy consumption.

“People may be unhappy to get an electricity bill for $200, but it’s even worse to find out that your neighbors’ energy bills are half what you’re paying even though their homes are the same size. Through enhanced billing consumers can better evaluate their energy consumption practices, determine how energy is being wasted, and take action."

Beyond a short-term move to enhanced billing programs, households could see even greater levels of savings through the application of more sophisticated programs that integrate utility-based advanced metering initiatives with on-line or in-home energy displays and tailored guidance regarding the highest-impact means of reducing energy waste.

Utilities across the country are investing in new electricity meters that provide two-way communications between the meter and the utility, and that monitor and collect household energy use data on an hourly basis (or even more frequently).

Key findings of the ACEEE report are as follows:

• Energy-use feedback can help households gain control over their energy use practices, reduce the amount of wasted energy, and reduce electricity consumption by 4 to 12%.
• Depending on how feedback programs are implemented by all of the nation’s electric utilities, consumers might enjoy a cumulative net savings of $2 to $35 billion or more over the next 20 years.
• Advanced (or "smart") metering initiatives alone are neither necessary nor sufficient for providing households with the feedback that they need to achieve energy savings, however they do offer important opportunities. To realize potential feedback-induced savings, advanced meters must be used in conjunction with in-home (or on-line) displays and well-designed programs that successfully inform, engage, empower, and motivate people.
• Utilities and policymakers should act now to ensure that U.S. households receive needed feedback by providing all households with: enhanced billing in the short term and real-time feedback (in conjunction with smart meter deployment) in the medium term.
• Providing households with persistent feedback has resulted in sustained savings over time.
• Since 1995, feedback-induced savings have been higher in Europe than in the United States, suggesting important differences in European policies and culture.

Source: ACEEE, POWERnews