Sunday, December 21, 2014

Smart Meters Have Failed and Were a Dumb Investment

Smart Meters Have Failed and Were a Dumb Investment

Failed Smart Meter ProgamAs we approach the end of 2014, it is clear that it has been a devastating year for utility smart meters and smart grid advocates.  Whether all utility executives yet realize it or not, smart meters have failed.  They have failed miserably to the deliver the promised benefits.  We are left with nothing but the increased costs and risks associated with boondoggle projects reminiscent of pork barrel spending bills approved in the middle of the night by a Congress wanting to get home for the Christmas holidays.
The Year in Review
Here is a list of some of the most important articles and events highlighted this year at SkyVision Solutions:
Whether the issue ranges from privacy to cyber threats to fires to health effects, it has been all bad news.  Furthermore, there have been news reports that question the fundamental underpinnings of why governments and the smart grid industry were supposedly trying to ever sell us this smart meter fiasco of a project in the first place.
Cracks in the Industry Narrative
Cracks in the smart grid industry narrative began to appear in June when the industry mouthpiece website ran an article called, “Smart meters trapped between benefits and dangers, claims Forbes.”  In quoting the Forbes article, stated:
“Despite the promise of empowering people through enhanced consumption data… some people are scared and resist the idea of smart metering, citing concerns about meter accuracy, data security, and health,” wrote Forbes contributor Federico Guerrini.  “Privacy is probably the most sensitive issue:  similarly to what happens with phone calls metadata, information about the energy consumption of a family or of an individual, can reveal a lot of details about the life of the persons monitored.”
A “reality check” report was released in July by the South-central Partnership for Energy Efficiency as a Resource (SPEER) in Texas, entitled “An Update on Smart Energy in Texas.”  In that report it was stated that:
“Texas has nearly seven million smart meters deployed, but according to the most recently available published data:
  • Only 30,000 customers log in each month to Smart Meter Texas to obtain consumption information.  That’s less than ½ of one percent.
  • Only 60,000 customers have ever logged in to Smart Meter Texas, or less than 1% (Smart Meter Texas, 2013).
As of the last public report about Smart Meter Texas, there are only 12,000 HAN devices connected to Smart Meter Texas, or less than 1 for every 540 smart meters deployed (Smart Meter Texas, 2013).  According to an anecdotal report from the Smart Meter Texas Operations Manager, that number has fallen by over 15% in the year since the report was issued.”
Also in July an article was featured at regarding hackers finding an open back door to the power grid.  According to the article:
“Making the electricity grid greener is boosting its vulnerability to computer hacking, increasing the risk that spies or criminals can cause blackouts.”
“Adding wind farms, solar panels and smart meters to the power distribution system opens additional portals through which hackers can attack the grid, according to computer security experts advising governments and utilities.”
“… electronic meters that send real time power usage to consumers and utilities are providing new back-door entry paths for computer hackers to raise havoc with the grid.”
There was another admission from in late December in an article that dealt primarily with smart meter-related fires:
The fires put utilities in a bind.  Smart meters have been an essential building block for the smart grid initiative and have been represented as providing several benefits, including more reliable service, enabling customers to better control their energy use and participate in money- and energy-saving programs, as well as enabling automating smart devices in their homes.”
“However, several utilities have or are dealing with lawsuits and backlash from customers who do not want the advanced meters, criticism that they invite invasion of privacy and cause health problems — all issues that have led to organized groups dedicated to stopping smart meter deployments.  While many utilities have fine-tuned their customer outreach and communication programs and offered or agreed to opt-out options, those solutions are likely inadequate to the task at hand:  reassuring a number of wary customers that smart meters are safe.”
So finally there has been at least some recognition of the “dangers” associated with smart meter technology; plus, consumers are not necessarily all that interested in reviewing their private “enhanced consumption data” that was supposedly going to “empower” them.
Warnings from the UK, Canada, and Australia on Costs 
Then came a warning in September from the UK:  “Smart metering technology ‘could be out-of-date’ by the time it is rolled out, MPs [Members of Parliament] warn” and that the Public Accounts Committee also questioned the value of the £10.6 billion project, with consumers expected to save just £26 a year.
Plus, keep in mind for the UK that the measly savings of £26 a year, 2% of the average bill, is a hypothetical number that is projected if consumers change their behavior based on what the smart meters are telling them.  This amounts to wishful thinking that people need or want smart meter data to reduce energy consumption.
Furthermore, a new published study released in mid-December showed that in-home displays (IHDs) provided to customers in the UK in combination with smart meters would likely have little effect on influencing consumers to conserve energy.  The smart meters and IHDs may have a “novelty factor” for awhile that will wear off over time.
For a press release summarizing the Ontario Auditor General report, refer to the following link:  Auditor General New Release – Smart Metering Initiative Had Serious Shortcomings – Benefits Not Yet Realized
Ontario Auditor General Dec 2014
Ontario Auditor General Dec 2014
[The above video contains material used pursuant to the Fair Use Doctrine under 17 U.S.C. 107 and is presented in the public’s interest for non-commercial purposes.]
Also in December, there were reports from Australia that “VICTORIANS will be slugged smart meter fees of up to $226 on their electricity bills next year”:
“Bill shock:  Smart meter charges set to cost most Victorians more in 2015.”
“The rollout, ordered by Labor and continued by the Coalition, has been plagued by cost overruns and safety and privacy concerns.  Victorians have been paying annual smart meter fees since 2010.”
The New York Times Article
On December 6th, 2014, an article ran in the New York Times, entitled “Power Savings of Smart Meters Prove Slow to Materialize.”  The article starts out by stating:
“The end is in sight for the meter reader, … They are being phased out because tens of millions of new meters talk directly to the electric company.  The meters can record use by the hour, changing the price as the market changes and telling the customer — or maybe even the appliances themselves — the best time to buy energy.
But this is not happening. …”
“’The smart meter giving people real-time access to price information is not going to make them get up in the middle of the night and turn their dishwasher on,’ said John P. Hughes, the vice president for technical affairs at the Electricity Consumers Resource Council, a consumer group that represents mostly large industrial users. ‘Getting the enabling technology to do that is going to take a long time.’”
“And there is the reduction in the jobs themselves; although the meters were paid for in part by the Recovery Act, which was supposed to stimulate employment, the effect of the meters has been exactly the opposite.”
’It eliminated literally thousands of meter readers across the country, and no way has it created any type of permanent work,’ said Michael Langford, president of the Utility Workers Union of America. ‘The meter-reading jobs were decent, good-paying jobs. People were able to buy homes, pay their taxes, buy cars on them, and we eliminated those.’”
“But for consumers, the payoff has for the most part not been realized. In the Maryland Office of People’s Counsel, which represents customers in public service commission hearings, William F. Fields, a senior assistant, said that the cost-effectiveness of smart meters had yet to be demonstrated.”
‘I’ve never seen an analysis that shows that shifting my dish-washing, clothes-washing and clothes-drying load is going to make a significant impact on my monthly bill,’ he said.  ‘It’s just not that much electricity.’”
An Extremely Critical Article from an Industry Blog
On December 8, 2014, an article appeared in the blog for Engerati, “a global meeting place for energy professionals to network, collaborate, share and engage.”  The article was entitled “UK Smart Meters Delayed. Again.”  People should take heed to its message.  Here are some selected excerpts from the article:
“Smart meters – any practical value? … “For the consumer [the UK delay is] likely to mean more unnecessary costs heaped onto future energy bills.”
Despite the charade of one step forward, one step backwards, we still don’t know whether the deployment will have any practical value.  There is no EU mandate for it – individual countries need to show that smart metering is cost-effective.  The first DECC [Department of Energy & Climate Change] survey showed it was not, but DECC mandarins then fudged the numbers (not my phrase, but that of an involved MP); since then they’ve spent a considerable amount of time and effort in concealing what’s behind their calculations.”
“At [a Freedom of Information] tribunal, a DECC civil servant argued that it was necessary to keep the contents of this document secret, because if they were made public, the SRO who wrote it would be identified and they might be openly criticised or even questioned about how they reached their conclusions.  At the time I didn’t know what an SRO was.  I’ve since discovered it means Senior Responsible Officer. Whilst I might have had some sympathy for this line of argument if the report had been put together by some office junior, I would have thought that the use of words like ‘Senior’ or ‘Responsible’ in a job title would have implied a certain degree of competence and responsibility.”
Last year’s delay was caused by concerns about security, or rather the lack of it.  Since then, hackers have demonstrated how it’s possible to hack into Spain’s smart meters, so don’t be surprised if there’s another rescheduling of the UK deployment next year for a further security review.”
It was never cost effective for the industry to deploy these [smart meters].  However, they’ve realised that DECC has given them the opportunity to do it and charge the consumer under the guise that they should have been smart.”
Extracting Sunbeams from CucumbersIt’s all part of our current energy policy, which is coming to resemble Swift’s satire of extracting sunbeams from cucumbers.  That’s probably the only renewable energy policy that DECC has not tried funding, but now I’ve brought it to their attention, they might.  From feed-in-tariffs to keep the voters happy to offshore windmills that are about as effective as treadmills for mermaids, we have a department that is out of control and prepared to squander taxpayer’s money on anything that can be claimed to save energy, ministerial face, the climate or the world.”
“Perhaps they should read the article that Ross Konigstein and David Fork have just published in IEEE Spectrum.  They’re both long term developers of renewable energy who write in a carefully considered article that ‘We had shared the attitude of many stalwart environmentalists: we felt that with steady improvements to today’s renewable energy technologies, our society could stave off catastrophic climate change.  We now know that to be a false hope.  Renewable energy technologies simply won’t work; we need a fundamentally different approach.’  Which suggests that the Department for Sunbeams from Cucumbers needs to start thinking hard about a Plan B.”
“Our energy security is too important to be left in the hands of civil servants who deny the concept of ‘senior’ or ‘responsibility’, let alone the idea of an evidence base for their programmes.  I call on the Government to comprehend this and review the smart metering programme…”
Damage Control from the ‘Greenwashed’ Environmental Defense Fund (EDF)
Getting back to the New York Times article from December 6th and the smart grid industry being in full damage control mode, someone from the Environmental Defense Fund wrote an article at the EDF blog on December 16, 2014 entitled, “Smart Meters Need Effective Electricity Pricing to Deliver Their Full Benefits.”  Quoting this EDF article:
“In Matthew Wald’s recent New York Times article, entitled ‘Power Savings of Smart Meters Prove Slow to Materialize,’ he argues that smart meters have failed to produce measurable savings.  And we agree – but not because smart meters themselves have failed.  Rather, most customers with smart meters don’t have access to people-powered, or time-variant, electricity pricing, which creates opportunities to save money.  This is a missed opportunity for customers, utilities, and the environment.”
This article ends by stating, “smart meters alone won’t be enough.”  So EDF is advocating “time-variant pricing” to “fix” the problem that smart meters have failed to deliver anything meaningful.   In fact, EDF seems to be advocating an “opt-out” approach rather than an “opt-in” approach to time-of-use rates in order to effectively force more people into these pricing schemes.
The EDF article then makes the inexplicable comparison of comparing decisions related to time variant pricing [a new term for Time-of-Use (TOU) rates] to that of making organ donations upon your death.  Regarding an opt-in policy:  “It turns out that this type of choice structure invariably leads to low adoption rates – not just with time-variant pricing, but with a host of other types of decisions, such as organ donation.”  EDF has the apparent belief that everyone should give up a “pound of flesh” for the benefit of the almighty smart meter program in order to somehow make it work at all cost.
What these think tank-type technocrats fail to realize is that ordinary working people and the vulnerable members of our society, unlike large commercial customers, have little to offer in terms of shifting load to off-peak hours.  Sure, they can weatherstrip their homes or change a few light bulbs, but people don’t need expensive and risky smart meters to do that.  And as stated in the New York Times article, “I’ve never seen an analysis that shows that shifting my dish-washing, clothes-washing and clothes-drying load is going to make a significant impact on my monthly bill.”  In fact, it is more likely that TOU rates will increase the bills of most consumers (as has happened in Ontario, Canada).
Think about common sense for a moment.  The EDF article narrowly mentions that a barrier to TOU rates has been concerns of how this type of pricing “might negatively affect low-income customers.”  That is a valid concern, and also many more people who are working out of their homes whether they be self-employed or telecommuting and are not necessarily low-income.  You have stay-at-home parents with young children.  You have elderly people on fixed incomes with medical conditions who need to stay physically comfortable as it has been shown that exposure to temperatures outside of a “moderate range” increases the likelihood of hospital emergency department visits, hospitalizations, and premature death.
Basically anyone who functions on a normal daylight schedule at home would be negatively affected by TOU rates, and the rest have little to offer other than shifting a few routines to late evening such as laundry.  This is not going to offset the overall effect of TOU rates on residential customers or the immense costs to deploy the smart meters in the first place.  [For additional reading about how the smart grid does not save energy and about such issues as “vampire energy,” refer to the article The “Smart” Grid Is Not Smart, Safe, or Green.]
So, no, the so-called “time-variant pricing” is not the solution to saving the already failed experiment with smart meters.  Smart meters have failed. Period.  What we have accomplished so far is reducing the number of people employed as meter readers and the miles driven by those workers.  Meanwhile, customers are left holding the bag with increased costs as well as all the increased risks associated with smart meter technology.  The sooner we halt the continued deployment of smart meters the better off we and society will be.  To extend the more esoteric example of Swift’s satire on extracting sunbeams from cucumbers, let’s use a more simple analogy that hopefully even the smart grid industry executives will be able to understand regarding our current predicament on smart meters, the Humpty Dumpty English nursery rhyme:
Humpty Dumpty sat on a wall,Humpty Dumpty had a great fall.All the king’s horses and all the king’s menCouldn’t put Humpty together again.
Humpty Dumpty
Humpty Dumpty
Source Material for this Article:
“Smart meters trapped between benefits and dangers, claims Forbes,” at
“SPEER Releases Report on Smart Energy in Texas,” at
“Hackers Find Open Back Door to Power Grid With Renewables,” at
“Investigation into Nevada Smart Meter Fires Intensifies,”
“Smart metering technology ‘could be out-of-date’ by the time it is rolled out, MPs warn,” at
“Smart Meter Rollout a Waste of Money Says New Study,” at
“Ontarians paying billions extra for electricity, auditor general finds,” at
“Few benefits from $2 billion smart meter program, auditor says,” at
“Smart Hydro meters deemed dumb public investment by provincial auditor general,” at
“Bill Shock: Smart Meter Charges Set to Cost Most Victorians More in 2015,”at
“Power Savings of Smart Meters Prove Slow to Materialize,” at
“UK Smart Meters Delayed. Again.,” at
“Smart Meters Need Effective Electricity Pricing to Deliver Their Full Benefits,” at

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