Back in October I installed a new heating and A/C system at my house. It was HOT on the final day of the install and I had a houseful of people heading my way that evening. We flipped on the air conditioner and it successfully cooled the house before everyone arrived. I was excited to see how much less electricity that the new system was using, so I ran out to my electric meter hoping to watch the little wheel spin ever so slowly. I was shocked and a bit disappointed to find that someone had switched out my old, trusty meter for one of the new Smart Grid digital meters.
This was before we got into the energy retrofit business and before I had given much thought to why they would put one of these on my house. I speculated that the electric company was looking to save the cost and hassle of using people to walk around every month, dodging killer dogs to read people’s meters. I may have been partly right, but I’ve since learned that the reasons for using Smart meters far exceed my original suspicions.
I was first tipped off to the real reason for Smart meters when I learned that they digitally send back my usage information every 5 minutes to the electric company. This was a huge clue.
My economics professor in college would always tell me to “follow the money”. So when I started asking questions, and this isn’t a huge secret by the way, I learned that the real reason for Smart metering is to get to a point where the electric companies charge time-of-use billing instead of the current method of taking a reading each month, subtracting the difference and coming up with a total Kw then charging you on a tiered schedule.
For decades the electric companies have preached not using your appliances during “peak load times”. Has it changed our usage patterns? Not really. And they know that. That was the carrot approach in the carrot vs. stick method of making people change. Here comes the stick. I have had people form our local electric company tell me that time-of-use billing will result in $1-$2 per Kilowatt hour charges during peak times, you currently pay between $.14 and $.35/kwh depending on what usage tier you are in. So, on a hot August day, feel free to fire up your 5 ton air conditioner, dishwasher, TV, and washing machine, but you will certainly feel the “stick” from your electric company. It’s not all bad news though. They will have super low pricing, I’ve hear $.02-$.04/kwh in the middle of the night. And, now that you have a Smart meter on your house, big brother will now exactly when you are using your kw’s.
With all of that in mind, along comes the Smart grid and smart appliances. Imagine a house full of appliances that maximize savings by operating during lower rate times, lighting that dims automatically up to 50% when prices are high ( if you choose to have it set up this way)- see my previous post on the Google light bulb to see how this might work. Your washing machine will start in the middle of the night, then your dishwasher. And that is just the beginning.
Properly sized, efficient, and as small as possible, HVAC equipment will be paramount when all of this takes place because you’ll want to be comfortable at peak times.
The local electric company in our area’s #1 strategy for energy creating is conservation. It’s not renewables or more power plants. Renewables are certainly a strategy for them, but #1 is conservation.
When I learned about all of this, I started to wonder how it might effect everything. How would traffic patterns change on the 210 freeway if companies were pressured by the cost of peak-load electric rates to consider moving manufacturing to the middle of the night? Would 2nd and 3rd shift one-day be as large as the traditional 8-5 work day? Who knows? But it will be interesting to watch.
Here’s a link to a great illustration on the Smart Grid website of how your smart meter will work in your house in the future http://www.smartgrid.gov/the_smart_grid#smart_home