Stakeholders in smart grid: common ground?
- Posted on July 17, 2012
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In the past week, we've featured columns about the regulatory environment, about the future of utilities, about the role of customers and the opportunities for third parties. (Deep breath.)
Let's attempt to synthesize these disparate threads to paint a picture of an industry in motion, identify the moving parts and add it all up. This won't be an extended meditation, I'm just shooting from the hip, as usual. Let me say upfront that, as I provide links to the columns under discussion, you'd do well to read the audience comments, as they are written by practitioners; lots of perspective there.
In "Regulatory Change and the Smart Grid," Bridge Energy Group's David O'Brien essentially called for a meeting of the minds among regulators, consumer advocates, utilities and vendors to find common ground.
O'Brien didn't advocate singing "Kumbaya," but he did suggest that everyone take a deep breath and perhaps walk a mile in the other person's shoes. Regulators and legislators would have to work together at the state level to provide a framework for regulatory changes that rewards efficiencies and returns on investment tied to performance.
O'Brien also suggested updating the curriculum for incoming regulators to include the latest market and technology innovations and how they could be incorporated into new rate making methods and outcomes.
In "Lessons Learned in the Storm: Last Year's Storm," I noted that New York regulators faulted utilities under their jurisdiction for lacking a sophisticated means to produce better estimated time to restoration and effectively communicate that to customers. Fair enough. Vendors now offer outage management systems that might or might not aid better ETRs , but we know that communication strategies and technologies are there to keep customers informed.
The nagging question is what measures were identified as needed up and down the East Coast in last fall's one-two storm punch and were the same problems implicated in the destructive derecho storms of late June this year? If so, there ought to be hell to pay. If not, the industry ought to be gaining some pretty instructive lessons.
One reader forwarded me news of a petition to force Pepco to underground its lines. But the article pointed out how many miles at X cost that step would require and the prospect was daunting. However, why not prioritize certain weak links and consider partial undergrounding in a wider-ranging strategy to improve grid hardening?
Ah, the "customer." This peculiar animal can be found in myriad forms with different stripes, from those that would happily use a smart thermostat to automate a response to price signals to save a few of their own dollars and large amounts of customer-funded capital projects, not to mention aggregate environmental benefits. But at the other end of the spectrum, a leaked FBI report finds smart meter hacking surprisingly easy and no shortage of folks who don't mind defrauding their utility.
The Utility Telecom Council will sponsor a webcast next week on the technical and business impacts of smart meter opt-outs and I'd suggest that's one of the hottest topics right now.
Between opt-outs, hacking and simple paranoia of Big Brother, all of which speak volumes about customer-utility relations (draw your own conclusions), "customer engagement" is about a decade behind where it needs to be. Yet we know that many, many regions of the country have had successful smart meter rollouts with little or no pushback. It's just that very few of those regions have really seen value propositions enabled by the new meters. Let's see some more OG&E dynamic pricing programs to get the bogey man back in his cage.
Vendors, if they could do one thing, is to provide a solution to the data privacy dilemma. I harped on this in "Privacy, Wireless Telecom and the Power Industry."
I'm not entirely sure what Hydro One is doing technologically by adopting Privacy by Design, the brainchild of the Ontario Commissioner for Privacy Ann Cavoukian, but it should be studied and emulated here in the States. If a technological solution can separate billing information from personally identifiable information (PII) pertaining to energy use patterns in the home or small business, bring it on. Otherwise, a significant kernel of mistrust will inform the most deranged critics as well as those legitimately concerned about misuse of such PII data.
Stay tuned, we've got more intriguing discussions coming your way. And thanks for your readership and the many notes I get supporting this column and the frank discussions we have here. In the immortal words of Janis Joplin, "Get it while you can." It won't last forever.
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