Cost of electricity: ‘It has to be painful’

October 23, 2009

What will President Obama’s “smart grid” bring our way? Consider this excerpt from today’s ClimateWire:

Michael Godorov, PPL’s manager of smart meter operations, said that a real-time pricing strategy requires a big differential between peak and off-peak prices to be effective. “It has to be painful enough for a customer to want to save money,” he said. “If you leave it to the consumer, you definitely have to put in enough incentives. The market has to make it imperative for customers to manage their use.”

“How do we get people to care enough about this?” asked David Mohler, chief technology officer of Duke Energy, at a conference in Washington last month.

If millions of motorists with plug-in hybrids were to arrive home at 5 p.m. on the hottest day of the year and want to do a quick recharge on a 220-volt appliance circuit, the electricity grid would have severe problems handling the load, Mohler said.

“We should have an ability to differentially price that,” he said. The fast-charge price could be equivalent to $20 for a gallon of gasoline, he suggested. Motorists content to charge overnight, when power prices are lowest, might have to pay the equivalent of 75 cents a gallon — a bargain price. “Until we can give them a way to painlessly respond to that price signal, I don’t know how we get to where we need to go,” he said.

Companies like Dallas-based Oncor that have committed to smart grid and dynamic pricing strategies believe most consumers will come along. Oncor has outfitted a truck trailer with a mini-classroom to show customers how its smart grid would work, and more than 22,000 people have taken a look since last year.

“We’ve had some people say, ‘Wait a minute, I don’t want this meter.’ They don’t understand it,” said Oncor CEO Bob Shapard. “They don’t like people coming in their backyard to change it. ‘What’s the matter with the meter I’ve already got?'” they say. “You get some of that pushback. The lion’s share of our customers, though, takes the other approach. Virtually all the customers that have been coming through the education center are asking, ‘When can I get my meter?'”

Here’s what you need to know about the smart grid and smart meters:

Smart = Consumer (gouging plus pain)

“Smart” is the new “stupid.”

5 Responses to “Cost of electricity: ‘It has to be painful’”

  1. antigreennuke Says:

    nothing wrong with the idea of flexible prices, as long as they are based on a free market of supply and demand. But once government or semi-government utilities are given control via smart meters, it’s likely they’re going to use it to push their green ideology and big brother monitoring on us. I’d expect energy “audits” done remotely and them sending you email warnings and energy saving “tips” based on your autmatically generated energy-profile (“you’ve exceeded your refrigerator’s official lifespan, time to buy a new efficient refrigerator, this message brought to you by GE”).

  2. nigelf Says:

    The solution is to abolish all the useless regulations against new power plants and let the market respond to an increased demand by building new plants. NOT by artificially increasing the price of electricity!

  3. 4timesayear Says:

    “It has to be painful enough for a customer to want to save money,”

    What, needing to make ends meet now isn’t enough? Seems to me that the ones wasting the energy have always been those with money to burn (like Al Gore). We peons have never been able to afford to waste it. It’s already painful. What more do they want?

  4. nikfromnyc Says:

    The solution to this is obvious. Have two batteries. That batteries are huge instead of the size of a beer can in the trunk makes this a bit inconvenient, granted, but imagining that they were that size makes the solution clear as can be.

    • antigreennuke Says:

      I agree a transition to electric cars is technically possible. As soon as the energy-conservation and “energy guilt” campaigns end and the government stops discouraging business activity left and right (nuclear energy being the prime example), we can finally move into a bright future of MORE energy and MORE prosperity NOT less.

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