(August 2011) Economic consultant Michael Rosenzweig challenges Constantine Gonatas’s proposal for ensuring FERC’s demand response rulemaking achieves its objectives. Also, Juliet Shavit...
I Want My In-Home Display
Consumers await a revolutionary interface.
Is it the customers? Is it the utilities? Is there a regulatory mandate? These questions have no easy answers,” Faruqui explains. “There are no federal regulations, and manufacturers are confused because of the different markets around the country. Technology is expensive because the economies of scale have not kicked in, and they won’t kick in unless an industry standard emerges. It’s a catch-22.”
But just as with high-definition TV, another technology that took longer than expected to reach the affordability tipping point, consumers are keenly interested in the features offered by in-home displays.
“We’re in an interesting time in the market,” says Barb Ryan, a senior research manager at consulting firm Energy Insights, who focuses her research on customer opinions and desires. “Household budgets are stressed and prices are going up. I don’t think a lot customers are aware of in-home displays yet, but when they are presented with the idea, large percentages are interested.”
According to Ryan’s research, when the technology is explained to them, 70 percent of consumers have a high level of interest in advanced displays, and 20 percent more have a moderate level of interest. The more information the device provides, the better. Consumers are most interested in real-time cost displays and programmable thermostats. And they want the information on the wall, not on the web.
“Customers are not at all excited about going online to see their energy use,” Ryan explains. “The big thing people really want, although it isn’t available yet, is having their use display segregated by appliances.”
A recent Energy Insights study shows that even the most rudimentary in-home displays lead to conservation rates of 4 percent to 14 percent. Other studies show high rates of customer satisfaction with in-home displays.
“When consumers have the choice, they like it,” says Chris King, chief strategy officer at meter data management vendor eMeter. “You constantly see satisfaction rates of 80 to 90 percent for people who have participated in pilot programs. The other measure that’s been studied is how many customers will sign up voluntarily. You get response rates of 30 to 50 percent.”
Still, most utilities are loath to take the plunge, at least quickly. About half the cost of installing smart meters is offset by operational efficiencies, such as remote meter reading, advanced diagnostics and exact outage mapping. But in some jurisdictions, other returns—like efficiency gains from demand response—don’t feed back to the utility. The result for most utilities is a lot of prognostication and pilot programs, but not much meaningful action.
“Once the will appears, both political and regulatory, it won’t take long,” Faruqui asserts. “You don’t have to dig up roads to do this. Once you reach the tipping point, it becomes inevitable. In two or three years the cost drops dramatically and everybody gets one. But some sort of market consensus has to occur. Someone has to step up.”
Green and Slow is Good
No place in North America may be farther along in this process than Ontario, where the government has mandated that the entire province be converted to smart