Smart meter success is all about people, not technology

A study of some 100 smart-meter pilot programs around the world has concluded that the technology can lead to significant and lasting energy savings. The biggest difference-maker between a more or less successful program, however, turns out to be not the technology used, but the way in which utilities work and communicate with customers throughout the process.

“Empower Demand,” a report prepared for the European Smart Metering Industry Group (ESMIG) by VaasaETT, found that energy savings are greatest — an average reduction of 8.7 percent — for smart metering deployments coupled with in-home devices that display energy consumption data in near-real time. More detailed energy bills and web-based usage data led to a lower, but still significant, energy savings of 5 to 6 percent on average.

Furthermore, peak energy loads can be shifted by as much as 16 percent through dynamic pricing, in which energy costs are adjusted up or down based on demand, the study found.

Despite ongoing resistance against smart meters by some people who fear privacy or health impacts, the pilot programs covered by the study — which involved more than 450,000 residential customers in all — were generally met with a favorable response.

“The main findings demonstrate that consumers do react to feedback and dynamic pricing mechanisms positively, pilot results maintain over 2-3 years and they can also be effective in consumer groups of over 1,000 households,” the report states. “In addition, post pilot surveys show that on average 75 – 90% of participants were satisfied with the pilot … in which they took part.”

The study also noted that a focus on people, rather than on technology, makes a difference in a smart metering program’s success. Metering initiatives that engage customers throughout the process have the greatest potential for success.

“Smart meters fulfil their potential due to the fact that they can support consumer engagement to a market-appropriate level through feedback and dynamic pricing and/or home automation,” the report notes. “It is very well expressed by Chris Johns, President of PG&E (Pacific Gas & Electric) shortly after the company undertook the SmartRate Pricing Program pilot project in 2010: ‘We thought we were undertaking an infrastructure project but it turned out to be a customer project.’ “