IEE's Lisa Wood: 'Change is happening'
I had a brief but informative chat with Lisa Wood, executive director of the Edison Foundation's Institute for Electric Efficiency (IEE), on Friday and thought I'd share a few of our exchanges.
The IEE has touted the rollout of interval meters in the country—about one-third of homes soon to be smart metered, one-half of U.S. homes by 2015. The basic notion is that you cannot manage what you cannot measure. The IEE's site states that it "works with the electric utility industry, regulators, policymakers and other stakeholders to advance customer-side solutions for energy management, including energy efficiency, demand response, distributed power and customer-focused technologies."
Along those lines, IEE has initiated the "IEE Partner Roundtable," which meets June 4 in conjunction with the Edison Electric Institute (EEI) annual convention in Orlando, Florida, in the first week of June. EEI, of course, is the national trade association for investor-owned utilities. The IEE Partner Roundtable brings IEE's management committee CEOs into discussion with executives of leading vendors whose expertise ranges from systems integration to metering infrastructure, from networks to customer-facing software.
You may recall that Wood penned an op-ed piece for us titled "Time to Move Beyond Pilots," which argued that pilot projects prevent utilities from moving forward more aggressively with grid modernization. In the essay she cited "status quo biases" among utilities and regulators for the inaction and argued for "phased deployment" instead.
One conversation that both Ms. Wood and I think will be intriguing is the following:
The Green Button initiative, backed by the White House and, so far, an impressive and growing number of large utilities—the Green Button provides a uniform way for consumers to access and view their own energy use data—may also allow consumers a simple way to provide their energy usage data to third parties that might offer innovative products and services.
That begs the question whether utilities that have joined the effort are in fact endorsing access to third-party solutions? Are utilities having the internal discussion over their future business model and will the result be a decision to own the customer, partner with third parties to manage the customer relationship or relinquish the customer to more nimble hands?
Obviously such a question, while near the heart of the utility business model, will find a variety of answers. I'd personally love to hear from utilities willing to share their thinking on this question.
Back to Wood's views. She said that the immediate benefits of smart meters is that they provide utilities with operational efficiencies such as remote connect/disconnect, outage information and more precise service truck rolls. Customers may be unaware of these benefits. Understandably, customer-facing benefits will take longer as they involve customer engagement programs for traction, Wood said.
She cited progress, however, in the findings of the industry's innumerable pilot projects, even if she has expressed some frustration with the pace of change in her earlier op-ed piece.
"We're seeing a lot of experiments," she told me. "We're not seeing as many full-scale implementations."
She did cite Oklahoma Gas & Electric's dynamic pricing program that seeks a 20 percent participation rate to curtail peak use.
"That's very real," she said.
Wood acknowledged that industry change has a chicken-or-the-egg feel to it, as utilities, regulators and consumer advocates work through their respective concerns. An example where all stakeholders have demonstrated that dynamic rates don't adversely impact vulnerable populations is the PowerCentsDC project that garnered a lot of attention over the past year, she said.
Another area of agreement between us: the fate of opt-out programs and who pays the cost of opting out. Currently, many states have implemented an opt-out option, but in California's case, it remains to be seen who will pay for the resulting manual meter reads and associated costs. In California, opt-out advocates in Marin County, for instance, insist that all customers bear the cost for individuals who refuse a smart meter.
Wood said that if those who opt-out bear the cost, that would limit the number of people opting out. And, in California's case, some industry observers have suggested that when dynamic pricing and other service options kick in (probably on an opt-in basis), word-of-mouth on the value of such a pricing scheme may lead some opt-outers to reverse their decision.
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