Smart meter skepticism has gone from talk to action as concerned residents and state regulators are challenging the value of smart meters in courts and regulatory hearings. Merwin Brown, co-director of the California Institute for Energy and Environment, says utilities' poor communication with their customers is to blame: "‘Hey you customer! You can’t understand this, but we’re doing this for your own good. We don’t know how to tell you why this is a must!'"

So why aren't utilities communicating frankly with their customers about the real reasons for smart meters? Take a look below to see why poor communication is holding back true smart grid progress—and what utilities should be doing to explain the real reasons to customers.
 

BAD ENGAGEMENT IMPEDES SMART GRID PROGRESS

One example of the impact of poor communication is the smart meter roll-out in Maine.

In June, the Maine Public Utilities Commission (PUC) voted to audit the smart meter program at Central Maine Power Co. (CMP), arguing that smart meters have cost customers millions of dollars without providing energy savings and benefits. In fact, the PUC flat-out denied CMP’s claim that customers will save a total of $25 million over the smart meters’ 20-year lifespan. Rather, the program will cost customers $80 million in rate hikes over that same period, according to the PUC. Even though 615,000 smart meters have been installed, very few customers actually used the smart meter data. The PUC’s hunch is that CMP failed to create and market valuable smart meter products and services. On top of that, the PUC has since been investigating smart meters after Maine’s Supreme Judicial Court sided with residents, who were concerned that regulators failed to ensure the delivery of "safe, reasonable and adequate" electricity service. Safe to say, CMP's poor customer engagement resulted in increased scrutiny and a lack of trust from customers and regulators.

But this is not an isolated case.  Poor communication and smart meter problems threaten to block smart grid progress.  At least several U.S. states have either banned smart meters, considered legislation against them or allow customers to opt-out.  After weighing the cost and benefits, Germany decided this month that the European Union’s recommendation that 80% of homes get smart meters would simply be too costly to consumers. Meanwhile, the anti-smart meter movement is taking root, especially as residents push back against utility claims that smart meters are completely safe. Just this July, British Columbia residents filed a class-action lawsuit against BC Hydro, citing smart meter’s potential effects on human health.

“If you took it at face value, the smart grid sounds like something the customer wants, asked for, is demanding, and will be excited about—like when the next iPhone is going to drop,” Merwin Brown says. “But that’s not the case.”

Over-promising smart meter benefits only undermines the smart grid, says Brown. Smart meter programs must be coupled with customer engagement initiatives to educate customers on the smart grid. After all, poor customer engagement only serves to worsen utilities' reputations and increase customer dissatisfaction.
 

REAL PROGRESS WILL BE ACHIEVED THROUGH REAL TALK

Utilities seeking to have successful smart meter initiatives must meet with customers and have frank conversations about smart meters, Merwin Brown urges. The true benefits of smart meters are far more complex than the oft-touted energy and money savings. They are the key consumer-facing piece of utilities' plans to contain the price of electricity, reconcile under-investment in the transmission system and improve reliability within limited operating margins. The recent rise of renewable energy and distributed generation resources only increases demand on smart technology to mitigate grid volatility.

It's reasonable that utilities believe customers will never truly understand this. So far, only a handful of utilities, including the Sacramento Metropolitan Utility District (SMUD) and Oklahoma Gas and Electric (OG&E), are effectively engaging customers on smart meters.

According to Brown, SMUD dispatched utility representatives to personally visit residents concerned about smart meters. With OG&E, utility executives saw the smart meter program as a customer engagement project, not just an infrastructure project. Roughly 44,000 OG&E customers are enrolled in SmartHours, a peak-time reduction program which helped the utility shed 72 MW of load by December 2012. Through its myOGEpower program, which uses a cloud-based web platform by Silver Spring Networks’ CustomerIQ technology, customers can view their electricity usage, bill estimates, monitory daily or hourly use and compare use over time. Customers also receive a weekly myOGEpower email summary reminding them to check their energy consumption. In a pilot program, customers with smart thermostats reduced peak demand by 57%.

The take-away here is that OG&E and SMUD realizing the importance of customer buy-in, something which will not only advance smart meter initiatives but also improve utility-customer relations. If utilities want to better their reputations, achieve smart grid progress and engage their customers, they have to do more than talk about it—they have to talk to the customer.
 

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