Con Ed spending $1.5 billion on ‘smart meter’ program
Con Edison is
planning to spend $1.5 billion to make its electric and gas meters "smarter.
The utility, which
serves nearly 10 million people in New York City and Westchester, wants to
embark on an eight-year "advanced metering initiative," as part of
its recently
filed rate case. If successful, the program would replace roughly 4.7
million meters and could serve as a platform for many of the state's renewable
energy plans in New York City, by far the biggest consumer of energy in the
state.
Advanced meters
provide near real-time, two-way communication between customers and the
utility, allowing for precise voltage control, demand response and a more
streamlined incorporation of the myriad renewable energy and energy efficiency
technologies envisioned for New York's power grid.
"The smart
meters enhance that capability," said Thomas Magee, general manager for
Con Ed's Smart Grid Implementation Group. "They facilitate the ease with
which you can integrate these resources into the grid."
But even before
many homes and offices are equipped with solar arrays, wind turbines and
battery systems, the advanced meters can change how customers understand and
engage with their energy use right now—a major tenet of the state's plan to
overhaul its energy grid, officially called Reforming the Energy Vision.
The utility has
explored demand response initiatives for more than a decade to get customers to
turn down the power during peak demand periods, typically on hot summer
afternoons. Advanced metering involves the same principle, though with much
more precision.
Customers would be
able to track when energy is most expensive and adjust their use, conceivably
doing so remotely by smart phone.
Karl Rábago,
director of the Pace Energy and Climate Center, refers to the technology as
Smart Grid 2.0—a more modern version of traditional demand response and
efficiency programs.
"Smart Grid
2.0 is about a wealth of new services built on the Smart Grid 1.0
platform," he said, adding the advanced technology is about "offering
customers value, mostly from third parties, and including, if there is a market
for it, the option to control our toasters with our phones."
What other energy
companies will be watching for over the course of the rate case is how
welcoming Con Ed's system is to competing forms of energy. The utility touts a
wide array of technologies that can interact with their new meters but
renewable energy companies are concerned that Con Ed will shut out competing
power vendors.
Ultimately it will
be up the state Public Service Commission to determine the rules of play.
Con Ed is excited
about voltage control—essentially raising or lowering the level of power pumped
into buildings with greater accuracy.
"We manage the
grid here to a certain voltage level but we really don't know where are
customers precisely," Magee said.
If voltage can be
lowered to certain areas, the utility can deploy it elsewhere where it might be
needed more.
The meters would
also provide real-time information on outages, allowing the utilities to more
quickly pinpoint where problems lie and how to isolate them.
Smart meters have
been the subject of some controversy. Because they receive and send signals
like wi-fi devices or cell phones, some people fear they emit harmful
electromagnetic waves. A group of mid-Hudson valley residents recently
upbraided P.S.C. staffers at a hearing in Kingston, N.Y., over the
technology.
Customers have also
expressed privacy concerns, because the information exchanged between the
utility and customer would give a much more detailed profile of how a single
household uses electricity
Rábago, a former
Texas energy regulator, said utility companies already know plenty about their
customers.
"The utility
already knows how you use your electricity," he said. "If you're
growing pot, they know it, believe me,"
Con Ed proposes
rolling out the program over an eight year period. They plan to spend $8
million in 2015, $69 million in 2016, $174 million in 2017, $317 million in
2018 and $306 million in 2019
Future expenditures
will put the total price tag at roughly $1.5 billion. Each meter, with
installation, will cost the company $270 a piece.
"We're hoping
that that price comes down now," Magee said. "We think we're coming
in with this at the right time."
In 2010, using
federal stimulus dollars, governments and utilities around the country began
installing smart meters. There are about 50 million advanced meters in the
U.S., covering 43 percent of households.
Magee said there is
more competition now that the technology has been deployed on a wide scale.
Over the next few
months Con Edison will put out requests for proposals from meter vendors, but
the program can't begin in earnest until the utility's rate case is approved by
the Public Service Commission.
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