Smart Meters Do Good In Washington D.C.

Are Americans capable of saving money–and energy–with better information and better available plans concerning their electricity usage? The results from a smart metering pilot program in Washington, D.C. would indicate that the answer is ‘yes.’

In the program, called PowerCentsDC, Pepco residential consumers in the nation’s capital were offered different rate designs facilitated by smart meters. The results of the program found that participants voluntarily reduced their summer peak electricity demands when given a price signal to let them know when electricity rates would be highest. As a result, they saved money (although a recent release doesn’t say how much, exactly).

smart meter

Image via PG&E

Among the different usage plans offered by PowerDentsDC, the ones that received the strongest opt-in response from customers were “critical peak pricing” (CPP) and plans that offered an hourly pricing. The CPP plan increased electricity prices five-fold for about 60 hours per year with power discounted slightly from regular rates during the remainder of the year. The hourly pricing plans included prices that vary hourly throughout the year and offered rebates to customers who curbed their usage during peak events, creating a “critical peak rebates.”

More than 90 percent of all participants saved money through PowerCentsDC rates, according to the non-profit Smart Meter Pilot Program, Inc. (SMPPI), which sponsored the pilot. A large majority of participants, when asked, stated their preference for the variable PowerCentsDC rates over the conventional flat rates Pepco has historically charged.

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Susan DeFreitas has covered all manner of green technology for EarthTechling since 2009. She is a graduate of Prescott College for the Liberal Arts and the Environment, and has a background in marketing green businesses. Her work on green living has been featured in Yes! Magazine, the Utne Reader and Natural Home.

    • Barbara Alexander

      Actually, this study did not document any significant bill savings. First, there was no statistically valid evidence of overall usage reduction by pilot participants. Second, the peak load reduction, while important and useful, did not result in any significant bill savings for participating customers, the average was 2% to 5% depending on the pricing option. This is typically not enough to stimulate customer enrollment in such pricing programs. Furthermore, the pilot did not reflect the actual costs to implement smart metering and new pricing programs for Pepco customers in D.C. As a result, once you include costs, the pilot did not suggest any important level of customer bill savings.

      Barbara Alexander
      Consumer Affairs Consultant

    • Concerned