(August 2011) Economic consultant Michael Rosenzweig challenges Constantine Gonatas’s proposal for ensuring FERC’s demand response rulemaking achieves its objectives. Also, Juliet Shavit...
Bringing Customers On Board
Realizing the benefits of smart meters.
savings recommendations provide additional reinforcement and commitment. Reinforcement mediums may include personal savings statements, quantification of the societal benefits a customer’s participation has generated, and real-time pricing communications via in-home display devices.
• Device ownership and cost recoup : Customer meter and equipment surcharges have caused programs to fail in the past. General rate-base recoup, where the cost of the devices is applied to all customers equally through rates, is optimal. Utilities must develop procedures to facilitate the integration of customer-provided equipment into demand response, MDM, asset-management, and load-control systems.
• Device functionality : Technologically-advanced devices with automation can better respond to demand-response events. Manual interaction of any form usually decreases the participation rate, and thus the benefit of the program.
• Customer control : Tools such as business intelligence portals, historical consumption analysis, and predictive cost modeling can help customers determine what price levels are acceptable—and decide when to shift loads to other times when pricing is more palatable. Customers will have greater control over the services they receive, when they receive them, and what prices they shall pay for those services.
Finally, utilities should consider implementing comparative-analysis tools that allow customers to see how their participation in various rate programs and rate structures compare to others, thereby facilitating their decisions to enroll in one program versus another.
AMI and smart-meter technology and implementation programs involve a complex, broad array of challenges. Additionally, a large majority of the potential benefits provided by AMI are in fact related to customer acceptance and participation in new programs designed to lower system operating expenses and energy-consumption charges. Effective communications and change-management programs supplemented with novel, easy-to-use and understand tools and technologies will increase the likelihood of the utility and the customer reaping and sharing the rewards associated with AMI implementations.
There is a follow-up to this article: Bringing Customers On Board, Part II .