“What we call ‘smart metering’ today will business as usual tomorrow.”

Michael Giberson

The title is a quote from a Q&A conducted by the Financial Times Energy Source blog with a couple of top executives from smart meter maker Landis+Gyr. Part 1. Part 2.

Questions were culled from suggestions from readers. First up in Part 1 are two questions from Tyler Slocum of Public Citizen:

Does the industry acknowledge that households must have consent on installation of these smart meters? And isn’t it true that unless the smart meter is integrated with “smart appliances“, then the smart meter’s ability to save consumers’ money is severely limited?

Go to the Energy Source blog to see the Landis+Gyr answer. Here is my response:

First: I’m all for consumer consent in retail electric power markets, but why pick on installation of smart meters? The local wires company likely owns the preexisting dumb meter, it presumably has every right to update the old meter when a new meter comes available. What right of the household is potentially infringed by a meter owner who changes the metering device without consumer consent?

I get that a smart meter has the potential to change the relationship between customer and power company, and, to rephrase myself, I’m all in favor of active customer involvement in this relationship. But we are approximately 100 years into a regulated environment (at least in the United States) where nearly every aspect of this relationship has been worked out between regulators and the regulated companies and barely the slightest nod over this 100 years in the direction of consumer consent.

Certainly, households should have the power to consent, or not consent, on all parts of this relationship. But the metering device is an odd place to start the conversation on consent. How about consent in the choice of retailer including the opportunity to choose someone other than the local monopoly? That would be consent worth talking about.

Second: No it isn’t true that a consumer needs the meter to be integrated with smart appliances in order to get more than “severely limited” savings. For example, in the Texas competitive retail power market, all of the retailer contract offers that currently require a smart meter are for prepaid consumer accounts. At least some of these offerings are for accounts that don’t require deposits, don’t impose disconnection fees, and can’t lead to the possibility of late charges or other penalties. For some consumers, these aspects of the accounts reduce the financial burden of paying for power service.

(Some environmentally-minded consumers like pre-paid accounts because it helps them cultivate a stronger awareness of their energy use, presumably also leading to some savings.)

Prepaid accounts don’t inherently require a smart meter. Some companies in Texas offered prepaid services that involved estimated billing, but these kinds of prepaid contracts did result in a lot of excess consumer fees due to the inherent difficulty of estimating bills without a smart meter. Estimated-bill prepaid accounts in Texas led to a lot of consumer complaints to the utility commission. Smart meters help eliminate one big source of disputes and are saving low income consumers money.

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