Here’s part of the answer to meeting Cascadia’s energy needs without building lots of new power plants: real-time metering of electricity so consumers can choose when to flip the switch.
Electricity costs vary by time of day but power companies typically roll charges into a monthly bill because it’s more profitable. Imagine how demand would change if companies had to give conumers more choice. The article cites a study that consumers would save nearly $23 billion a year if they shifted just 7 percent of their peak consumption to less-costly times.
Just as cellphone customers delay personal calls until they become free at night and on weekends, and just as millions of people fly at less popular times because air fares are lower, people who know the price of electricity at any given moment can cut back when prices are high and use more when prices are low.
Metering is just one of the hurdles in the way of more renewable energy without building more traditional power plants.
Comments
2 responses to “A fix for energy shortage? Consumer choice”
Where is the reference for ‘power companies typically roll charges into a monthly bill because it’s more profitable’? You might research a bit and find out that PSE proposed real-time rates, had a pilot program implemented (I was on that pilot and it worked great), but the WUTC shut it down because consumers were too confused about the different prices at different times of the day. The pilot had only 3 different time-of-day blocks with pricing fixed at each block as opposed to the more complicated implementation of real-time pricing. PSE has installed meters at the residential level which provide real-time usage data. Customers are currently able to use the PSE web site to see their real-time and profile of usage.
Every power utility would like to lower its peak demand since the cost in extra equipment (additional base generation, additional reserve generation, additional line capacity, additional transformer capacity, additional reactive support) is substantial and often only needed for a few peak hours in the peak demands days of the year. Yes, utilities can receive capital recovery on these assets, but often at the expense of getting increases in regulated rates to cover increases in fuel purchase costs.
Unfortunately most utilites are constrainted by their local state regulator and prevented from offering real-time pricing. The WUTC is ours for Washington State.
http://wutc.wa.gov/
Let’s get some public visibility into how our state regulator constraints this industry.
The UTC has also actively protested against the Federal Energy Regulatory Commission pushing market-based pricing for electricity in the pacific northwest:
14-Feb-2003 WUTC Newsletter
WUTC ACTIVE IN OPPOSING STANDARD MARKET DESIGN
The UTC has actively opposed a Federal Energy Regulatory Commission’s
(FERC) proposal to restructure the electricity sytem because it will harm
customers and utilities in the Pacific Northwest. Instead of forcing the
creation of expensive and risky new power markets in the Pacific Northwest,
the UTC argues that FERC should focus on better monitoring and policing of
existing wholesale power markets. The federal proposal would foster
uncertainty and instability for electricity prices and investments in new
power plants. Among other things, the FERC proposal would require
market-pricing of transmission service and formation of centralized,
spot-markets for electric power. Such new, required markets are unnecessary
in the Pacific Northwest and would be risky and damaging to the region’s
hydropower system, said the UTC in comments filed before FERC. FERC is the
federal agency that regulates transmission of electricity and wholesale
power sales in interstate commerce. The UTC is responsible for
participating in federal regulatory proceedings to represent the interests
of Washington electricity customers.
I’m not sure how breaking it into three time blocks would help consumers moderate demand. It seems like real-time needs to be the goal. It doesn’t really help to know that it’s cheaper in the middle of the night, but it might help to know it’s cheaper at 8 pm than at 7 pm or depending on a particular day’s demand.
You’re right about the WUTC. How does their performance compare to those in other states?