Synapse report on AMI benefits for residential customers in New Jersey undervalues consumer benefits due to its narrow, control-oriented focus

Lynne Kiesling

On July 8, 2008, Synapse Energy Economics released a report titled “Advanced Metering Infrastructure — Implications for Residential Customers in New Jersey“, commissioned by the New Jersey Department of Public Advocate. The report’s primary focus is an analysis of the cost-effectiveness of investments in Advanced Metering Infrastructure (AMI) from their definition of the point of view of a representative residential consumer. Unfortunately, the report does not ask the right questions to get at the alternatives that would produce better consumer outcomes.

The overly-narrow definition of benefits that the authors employ excludes the benefits that customers would gain by choosing from a portfolio of contracts. Furthermore, the authors focus solely on approaches that are consistent with the top-down control-oriented policy relics of the 20th century, and fail to appreciate the benefits for themselves and for system reliability that individual consumers can achieve when AMI-enabled retail choice empowers them to control and manage their own energy use, by making their consumption and cost information more timely and transparent.

Remainder of analysis below the cut …

Continue reading