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While speaking at PCBC 2010 last month during the Smart Energy Series, I noticed a number of audience members checking their phones, undoubtedly looking at e-mail, text messages or ‘tweeting.’ It then occurred to me that, as for many of you, my cell phone is an indispensible communication tool I (almost) never leave home without.
Because my cell is such an integral part of my life, it’s imperative that both the phone and network plan fit my needs. As my needs and wants shift, my handset and plan changes as well. What’s great is how the infrastructure of this service empowers me to not only understand what I need (i.e. more minutes, faster speeds, etc.) but helps me make informed decisions based on my usage.
Thirty years ago we had no such power. Phone service options were simple: local and long distance. Pricing plans were established by phone companies without knowing how many minutes we used or number of calls we placed. But our thinking evolved as technology advanced and more information became available, not to mention the adoption of cellular services. We moved from simply accepting ‘all-you-can-eat’ pricing and expected to pay only for what we use (and have the minutes we didn’t use roll over). Our collective mindset towards this service has shifted and we will never return to the days of old.
But why talk about cell phones on a smart grid website? Because just like the cell phone, the smart grid has the potential to become an indispensible tool that helps to personalize energy for consumers so that monitoring their consumption becomes an easy, natural part of everyday life. A smarter grid can provide the information we need to help shift from an ‘all-you-can-eat’ pricing for electricity to paying for what we need and use.
The cell phone payment plan is a primary example of the smart grid’s potential: When I recently went in to renew my contract I was bombarded with options – did I want to sign up for 450 minutes a month or 5,000? Did I want mobile TV, turn-by-turn navigation, unlimited mobile-to-mobile calling? Although the options are seemingly endless, the point is this: I pay for what I need based on how much I use. And I make this decision based on information available about my usage.
My electricity bill is a different story – I have no clue how much I’m being charged for the month until my bill arrives. Even though I turn off lights when I’m not in the room, I have no idea what the saving impact is on my monthly bill. And unlike my cell phone that costs less to use between 9pm and 6am, I don’t know how much electricity costs throughout the day.
That lack of information about energy use could change with a smarter grid. The smart grid is about empowering you and me with the information we need to make smarter energy decisions.
Similar to how making calls on your cell may be less expensive between 9pm and 6am, the smart grid could allow us to tap into cheaper electricity rates that could become available when energy costs less to produce – during non-peak hours.
Which brings me to my point: what does having access to flexible energy rates mean for you? Imagine if your electricity provider could offer you options like your cell phone provider. Imagine if you could tap into lower electricity rates offered by your power company at certain times of day. Imagine if you had information that could help you save money by automatically adjusting electricity consumption in response to pricing signals from your utility.
When you consider that home appliances – including heating and cooling – account for a combined 85% of total energy consumed in the home, being able to tap into lower electricity rates becomes an even more attractive opportunity.
Just how would the appliances tap into these lower rates? Smart appliances could respond to price signals from utilities, using energy when the cost is lower during off-peak hours (typically between 2 pm and 7 pm). For example, you could set your refrigerator to automatically delay the defrost cycle until utility rates are at their lowest, set your clothes dryer to reduce its wattage when operating during peak hours, and set your water heater to operate only in its highest efficiency mode during periods of high electricity demand. Although these automatic settings are ideal, consumers would still have full control to run the appliances when we need them, accommodating any immediate needs.
So why now?
As we look to our energy future, we’re faced with an increasing number of challenges. Reliability and weather issues affecting the nation's aging electric grid cost U.S. businesses more than $150 billion per year from power disruptions and outages, according to the U.S. Department of Energy. Compounding this problem, the U.S. Energy Information Administration predicts that global energy consumption will triple by 2050.
There’s plenty of good news for consumers though: a year-long study by the U.S. Department of Energy showed that real-time pricing information provided by a smart meter helped consumers reduce their electricity costs 10% on average and helped reduce their peak consumption by 15%.
What’s more, with smart appliances, we can set preferences and walk away, letting the technology work for us. This 'set-it-and forget it' functionality is good for both the utility and for us consumers – we’ll be able to save energy without having to remember, for example, to turn off the lights.
I’m excited about the vast potential the smart grid has to help us make smart decisions about energy use. After all, the more we know about how much energy costs and how much we use, the better armed we’ll be to make small changes to save money and conserve energy – knowledge truly is power.
Learn more about what the smart grid means for consumers on ItsYourSmartGrid.com’s Smart Grid Solutions page.
Caption: GE Smart Appliances in action (Smart appliances include from left to right: refrigerator, microwave, oven, washer & dryer, and water heater) |
