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Power metering: evolution is required

image credit: kW and kWh should be measured and charged
Rafael Herzberg's picture
Consultant energy affairs Self employed

Rafael Herzberg- is an independent energy consultant, self-employed (since 2018) based in São Paulo, Brazil* Focus on C level, VPs and upper managers associated to energy related info, analysis...

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  • Jul 24, 2020
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Power Metering: evolution is required

Digitization has taken over our lives. For two main reasons: the value they bring to our daily activities and their increasingly attractive cost.

In the electricity sector, two are the main cost parameters incurred by the value chain: kW capacity and kWh energy.

For business and institutional consumers the meters record kW and kWh and are thus charged accordingly.

Residential meters only register kWh. And so what? In practice, the kWh tariffs include a "prorated" value for the kW capacity..

It is high time to evolve. To reflect the reality of each consumer and thus enable attitudes towards efficient and parsimonious use of capacity.

Discussions
Tom Langdon-Davies's picture
Tom Langdon-Davies on Jul 28, 2020

Smart digital meters could allow consumers to be rewarded or not penalised for limiting demand at peak times, as commercial consumers are, e.g. the Triad system in UK.  This would be in addition to the "hard stop" peak capacity demand.

Unfortunately we are still a long way from such sophistication here!

Jim Stack's picture
Jim Stack on Jul 28, 2020

I agree. I Think everyone should be billed by Time Of day and have Demand charges. But so they can control their use they should be able to have Solar with advanced Batteries so their home or business can cover these Peaks. In FACT they should be paid the Peak rate if they send power back during the Peak hours. When you make fair traiffs that encourage the right behavior you will get good results. 

Eric Van Orden's picture
Eric Van Orden on Jul 28, 2020

Personally, I'm on a residential peak demand rate with Xcel Energy Colorado (https://www.xcelenergy.com/residentialrates).  As a consumer, I like it because of the low cost of energy (kWh) at night is great for sleeping in a cool house and charging my EV.  The demand (kW) charge between 2-6pm is steep but totally manageable.

That said, having access to real-time energy insights on my mobile app really helps to reduce the stacking of major appliances. I'm happy to pay attention, save on my bill, and support a more efficient grid. As time goes on, digitization and automation will make it even easier for utilities to balance increasingly dynamic supply and more flexible demand. But, you have to start somewhere with the measurement and price signals. 

Matt Chester's picture
Matt Chester on Jul 28, 2020

I'm curious if you think adoption of this was easy for you that might have been tricky, frustrating, or discouraging for someone outside of the energy industry. I've contacted my utility multiple times asking for some sort of TOU rates, which probably puts me in the great minority of residential customers, but I always got the impression part of the inertia is that they don't know that the average customer would really act any differently 

Eric Van Orden's picture
Eric Van Orden on Aug 12, 2020

From a consumer perspective, it would take a large groundswell to push a utility to time of use rates. The adoption of TOU rates takes some work by the utilities for sure. It requires the right metering infrastructure, a potential pilot to inform the proper rates structure before going broader, and planning a lot of important details to educate consumers about the options and cost risks/rewards. 

That said, Steve Jobs showed us the value of delivering something that consumers are not asking for or don't even know to ask for. Delivery of a great product including pricing, customer experience, social benefit, etc. make the difference.  

Matt Chester's picture
Matt Chester on Aug 12, 2020

That said, Steve Jobs showed us the value of delivering something that consumers are not asking for or don't even know to ask for.

Great analogy! Thanks for the follow up, Eric. 

Rafael Herzberg's picture
Thank Rafael for the Post!
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