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California utility Southern California Edison (s eix) has been slowly laying down the final details for one of the largest smart meter deployments in the U.S.: 5.3 million smart meters to be installed between 2009 and 2012. California’s regulatory body for all things power-related, the California Public Utilities Commission (CPUC), said on Thursday that it had approved $1.63 billion in funding from rate payers for the third deployment phase of the program.
While SCE had sought approval of that funding over a year ago, the CPUC had to determine that paying for the program with rate payers funds — which could mean an initial increase of 1.5 percent on customer energy bills — would also benefit the ratepayers themselves. CPUC says in its release that it has “determined that the project offers between $9 million and $304 million in net benefits to consumers.” And that doesn’t begin to cover what consumer can ultimately save on their bills with real time pricing, what the utility can save from energy conservation, and the overall carbon emissions reductions.
The CPUC’s approval actually adopted the decision of a settlement between the SCE and the CPUC’s rate payer advocacy group Division of Ratepayer Advocates (which acts as an independent body). That settlement said that SCE’s smart meter program could reasonably generate $1.17 billion in operational benefits and $816 million in energy conservation benefits, and determined the $9 million baseline net benefit to consumers.
SCE’s smart meter rollout will enable the utility to offer close to real-time pricing as well as thermostats and appliances that can respond to the needs of the power grid. By implementing demand-response technology, SCE can not only save money from not having to add more power generation, but can make the grid more stable by shifting loads during peak times.
For consumers, real-time pricing can help them save on their monthly bills. In California Statewide Pricing Pilot –- a large electricity pricing study conducted in SCE’s service territory during the summers of 2004 and 2005 — consumers in a pilot study did end up reducing their consumption based on price info. But more importantly, smart meters can help consumers reduce their energy consumption, which means less carbon emissions. SCE estimates their smart grid program will “reduce emissions of greenhouse gases and smog-forming pollutants by a minimum of 365,000 metric tons per year – the equivalent of 79,000 cars being removed from the road.”