Photo Credit: Chris Doelle, Flickr
The uproar over bill spikes at Pacific Gas & Electric and Oncor seems so 2010, but that doesn’t mean that utilities are no longer immune to political lashings.
Just last week, George Jepsen, Connecticut’s Attorney General, denounced Connecticut Light & Power’s AMI proposal, which said the new meters would cost more than $430 million but would save customers more than $550 million over a 20-year period.
The utility cited savings in O&M and also in peak reduction, as the new meters would come with voluntary time-of-use pricing and demand response to curb peak usage. The AG, however, was unimpressed.
“CL&P’s proposal would force the company’s ratepayers to spend at least $500 million on new meters that are likely to provide few benefits in return,” Jepsen said in a brief filed with the state’s Department of Public Utility Control. Instead he called for waiting and watching until something better and more cost-effective came along.
The utility argues that waiting to replace its AMR meters with more advanced technology will only make the change more expensive down the road, and that the cost of maintaining the current system is more than that of a new deployment.
Jepsen’s argument is not about now versus five years from now, nor is it about exploring different communications systems or pricing schemes. Instead, he calls for a “surgical” approach throughout the brief, where meters are only given to those who ask, and can pay, for them.
Instead of demanding that CL&P pay for far more of the deployment, as was mandated after Baltimore Gas & Electric’s initial smart grid proposal was rejected (and later accepted), Jepsen’s letter asks the DPUC to simply deny the proposal.
Jepsen is not the only AG taking a cleaver instead of a scalpel to proposed changes for utilities. In Illinois, Attorney General Lisa Madigan’s office said she was “strenuously opposed” to a bill that would reportedly allow for rate increases to be approved in as few as 45 days, instead of 11 months, and would reportedly lock in profit margins for the utilities above 10 percent.
However, Commonwealth Edison, which helped write the legislation, is clear about the fact that the bill is up for debate. It’s true that the starting point may seem like the outrageous opening offer in a bustling bazaar -- but this is where the haggling gets interesting.
There is a middle ground between the utilities raising rates with no checks and balances and having to wait a year or longer to move forward with smart grid improvements, just as there is a compromise between a utility saddling its customers with the full cost of smart grid projects and having to bear all of the cost upfront itself.
After all that talk in 2010 about making the case to the customer, there is still obviously a long way to go for utilities to make the case not just to their own consumers, but also to politicians, that moving the grid into the 21st century isn’t just about padding the bottom line.
Let the bartering begin.