Study shows big smart meter investment yielded 'very small' electricity savings

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Smart meters and time-of-use electricity pricing have only modestly reduced residential energy demand during the most expensive peak periods, a new study suggests.

Researchers at the University of Waterloo compared data for nine months before and nine months after time-of-use rates were introduced in November 2011 by an unidentified distribution company with more than 20,000 household customers in southwestern Ontario.

Using advanced statistical tools to factor out the impact of weather differences, their analysis showed residential demand for dropped just 2.6 per cent during on-peak periods and 2.4 per cent during mid-peak periods following the change.

"There is a gain, but the gain is very small," said Lukasz Golab, a management sciences professor and Canada Research Chair at Waterloo.

Smart meters to enable time-of-use pricing were installed by hydro utilities across Ontario at a cost of about $1 billion. A key goal was shifting demand away from peak periods to reduce maximum capacity requirements and save money on infrastructure.

The study did not attempt to assess if the cost of the switch to time-of-use pricing has been justified by modest changes in the behaviour of residential customers.

"Is it enough?" asked Catherine Rosenberg, a professor of electrical and computer engineering and also a Canada Research Chair at Waterloo. "Of that I'm not sure. We don't have the data to decide if these kinds of savings warrant the use of ."

The findings also suggest that time parameters used to set rates may not be aligned properly with actual usage, at least for residential customers. The summer on-peak period on weekdays in Ontario is noon to 5 p.m., but demand actually hit its highest point at 6 p.m. in the utility used for the study.

The research, which also involved former master's student Reid Miller, was recently published in the journal Energy Policy.

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Journal information: Energy Policy

Citation: Study shows big smart meter investment yielded 'very small' electricity savings (2017, May 31) retrieved 23 October 2019 from
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User comments

May 31, 2017
The consumers can't adjust to the change in just 9 months, because they can't all jump to install the equipment to make use of time-of-use discounts.

For example, to make use of cheaper night rate electricity, you have to install a larger storage water boiler to ensure you have enough hot water throughout the day when the rates are up. That costs money, and for many users it's simply impossible - where do you find the space in an apartment building?

Smart meters alone don't do anything. You need smart appliances and smart users.

The transition may take decades, as whole houses may need to be rebuilt to make a meaningful change in the use patterns without inconveniencing the occupants. It's not simply a matter of putting your heating or AC on a timer, because then your house will be hot/cold during the day.

Jun 05, 2017
Besides, there's nothing smart about time-of-use pricing.

The old style analog meters also had a switch that was driven by an overtone signal from the utility through the power lines, and would switch the counter gears depending on what the current rate was.

The meter had two or more sets of number wheels that would count your day and night kWh. Some models also had a switch that would engage external relays for heating/cooling systems etc. depending on which rate was on, so you could do things like only run your chest freezer at night.

Jun 11, 2017
"Besides, there's nothing smart about time-of-use pricing. "

Unless you are a power company trying to maximize resources and accurately cover your costs.

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