People like saving money, even if it's just a few dollars a month, according to the results from a smart meter and variable pricing pilot, PowerCents DC, conducted by eMeter and Pepco in the Washington, D.C. area.
The findings from the study, which were preliminarily released in July, found that people like critical peak rebate programs, although they save even more energy when they're enrolled in critical peak pricing programs.
Oddly, however, the pricing was nearly the same for the two groups. Customers paid about $0.11 per kWh in the rebate program and received a $0.75 cent rebate for every kWh they cut during critical peak periods. The critical peak pricing group only saw another tenth of a cent shaved off of the regular rate, to $0.109 per kWh, while they paid $0.75 per kWh during the peak price hours, which added up to about 60 hours per year.
There was also a group using an hourly pricing system that paid from $0.01 to $0.37 depending on the season and time of day. The peak pricing contingency reduced their use by an average of 34 percent in summer, compared with 13 percent for the rebate group and just 4 percent for the hourly participants.
Along with TOU pricing, participants received monthly energy reports and in-home displays with real time pricing and online access to Energy Engage, which showed detailed energy consumption data and tips for conservation.
The average savings came out to about $44 per year, which doesn't sound like a lot. "It's not a huge amount," admitted eMeter Chief Regulatory Officer Chris King. "But was it enough to motivate them? It definitely was."
More importantly, 93 percent of participants said they liked the program -- no matter which payment plan they were on -- better than their old rate, according to King.
The pilot also was infused with a robust education plan that included emails, regular mailing, community meetings, a web portal and refrigerator magnets about the basic parameters of the program. So while the savings were scant, the sense of empowerment was significant.
Also, it was not necessarily the technology that empowered people. When asked about how they preferred to receive information about their electricity, about half of the nearly 1,000 participants said they want it on their hard copy, snail-mailed bill rather than online. One-quarter of the respondents said they're not even interested in receiving information about their energy usage from a website.
So for all of the talk about your smart thermostat chatting it up with your smart dishwasher, which can then coordinate with your smart meter or be uploaded to a web portal through a Wi-Fi connection, this pilot shows that the general public just doesn't really care.
For Pepco, the process of giving customers a choice is top priority. "We will be changing the relationship with our customers," said Thomas Graham, president of Pepco Holdings Inc. "They'll know what the price of energy is and they can respond to that."
The option to respond to price signals, which were provided with 24-hour notice via telephone, text alert or email, is appealing, even without significant cost savings. And while many customers said that the online portal wasn't that interesting to them, it is crucial to have as a component of customer engagement (about a quarter of participants said it was 'very appealing').
The pilot, which will move into a full smart meter deployment, will likely be held up as an example of best practices for other utilities and jurisdictions to follow, according to George Arnold, National Coordinator for Smart Grid Interoperability for the National Institute of Standards & Technology. However, it is unclear whether dynamic pricing will be offered to customers that choose another electricity provider besides Pepco in the Washington, D.C. region. "Issues about access to data are among the issues we have to evaluate moving forward," said Graham.
EMeter is not the only company that uses an education-heavy but simple approach to engaging consumers to reduce their energy use. Other companies like OPower also have a similar approach to filling the gap to engage the low-income and low-tech residential market.
The San Mateo-based company has made significant inroads with the utilities to which it has already provided MDM services, and the company is also expanding into Asia with a pilot of its Energy Engage platform in Taiwan.
But even if this pilot is used as a best practices, there are a variety of companies that can offer these sorts of simple, consumer-based initiatives for critical peak reduction. While simplicity will be key for the first round of customer engagement initiatives, there will need to be a second generation of energy management systems waiting in the wings for people to take advantage of once they become comfortable managing their energy use based on dynamic pricing.
But we're not there yet. Not even close.