Smart Meters Gain Popularity, But Most Utilities Don’t Optimize Their Potential To Save Energy

Despite billions of dollars invested in advanced metering infrastructure (AMI), new ACEEE research finds that most utilities have vastly underused this technology to help customers save energy.

The report, which surveys 52 of the largest US electric utilities, shows how utilities can tap such data to deliver energy savings.

Big data, big savings

We live in an age of “big data.” Our digital and connected world creates, transmits, and stores immense amounts of data on all aspects of our lives. Not surprisingly, AMI — which comprises smart meters, communication networks, and data management systems — has grown rapidly. A key element of grid modernization, AMI is now in place in many states, covering nearly half of all meters in the United States.

AMI measures our electricity use in short intervals (typically 15 minutes or 60 minutes) rather than by month. Our electricity providers can use such timely, granular data to better manage and optimize generation and grid operations, thereby reducing costs and responding faster to power outages. They can also use the data to offer better programs and share insights from the data to encourage customers to save energy.

Yet our report shows that only one of the 52 utilities surveyed — Portland General Electric (PGE) — is building its capacity to optimize use of AMI for saving energy. PGE is tapping all six of the use cases we have identified for applying the data. These cases fall into four categories:

• Feedback: Moving from monthly, confusing energy bills to near real-time, customized feedback and applying behavioral insights on how customers can save energy and money.
• Pricing: Shifting from fixed rates that don’t reflect the underlying cost of service to time-of-use rates that inform and enable customers to respond to price signals.
• Data disaggregation: Using granular data for program targeting, evaluation, and innovative designs, such as “pay-for-performance.”
• Grid connectivity: Offering new programs with grid value and customer bill savings, such as grid-interactive efficient buildings (GEB) and conservation voltage reduction.

Our survey showed that behavior-based feedback and time-of-use rates are the most prevalent use cases, with 26 utilities implementing each of these measures. The least common are newer applications: data disaggregation (seven utilities) and GEBs (four utilities).

PGE has developed customer applications for AMI data, which include customer portals to track near-real-time energy use, data disaggregation for key end uses, behavioral tools, connections to energy efficiency programs, and pricing alerts. It is also piloting time-varying rates and conservation voltage-reduction programs.

Three utilities in our data set, Commonwealth Edison, NV Energy, and CPS Energy, leverage AMI for five use cases. Twenty-one utilities leverage AMI for two to four use cases, and seven reports using AMI for only one use case.

These findings suggest a large untapped potential for using AMI to deliver energy savings.