Utility executives and some energy-efficiency experts have been dreaming for years of a smart electricity grid connected to smart appliances that can be remotely controlled. In many North American cities, however, the installation of smart meters has faced strong opposition from some homeowners. The resulting fallout has amounted to a public relations nightmare for electric utilities.
According to utility engineers, the smart grid will be able to accomplish many things. Married with smart appliances, the smart grid will eventually:
- Allow the utility to read your meter without visiting your house.
- Allow the company to create tiered pricing systems with rates that vary depending on the time of day.
- Provide the utility with real-time access to energy use data for each customer — data that can be broken down by appliance.
- Provide homeowners with real-time energy use data.
- Allow customers to remotely control their own appliances.
- Allow the utilities to remotely control customers’ appliances during periods of heavy electrical demand as part of a “demand response” strategy.
GE, Samsung, and LG are now manufacturing smart appliances that can interact with a smart grid and can be controlled from a remote location.
When utility executives first hatched the idea of smart appliances, their chief motivation was a desire to remotely control appliances as a “demand response” strategy. “Demand response” is utility jargon; it refers to measures designed to lower electricity demand during peak hours. (When peak load is high, some electric utilities struggle to meet the electricity demand of their customers.)
I first became aware of utility executives’ smart grid vision in early 2008. My article on the topic, “DOE Studies Homeowners’ Tolerance Of Utility-Controlled Appliances,” appeared in the February 2008 issue of Energy Design Update. I wrote, “In a study conducted by researchers from the Pacific Northwest National Laboratory, 50 homeowners in Washington and Oregon were offered a free electric dryer and a free electric water heater in exchange for participation in a study called the Grid Friendly Appliance Project. It was explained to the homeowners that the new appliances included devices allowing their heating elements to be remotely controlled. The control devices turned the heating elements off during certain peak load periods, ‘to help reduce pressure on the grid.’ Describing what might be termed ‘stealth load shedding,’ the researchers explained, ‘Anyone’s willingness to supply demand-side responsiveness will be influenced by the inconvenience they must endure to supply the response.’ … The ‘grid-friendly’ dryer used in this demonstration simply stopped powering the heating elements, leaving the dryer drum to tumble until the heating elements could come back online. Significant power was thereby shed without an observable inconvenience to the dryer owner.”
As a website established by the Canadian Electricity Association explains, “At both the commercial and residential level, utilities have for several years been actively deploying demand response programs to smooth out periods of peak consumption. In these programs, water heaters or thermostats respond to explicit requests made by utility control centers to reduce electricity demand.”
The beginnings of a backlash
In recent years, utilities have faced a backlash from customers who resent the idea that utilities are developing the capability to remotely control the operation of their appliances. As a result of this backlash, utilities and appliance manufacturers have backed away from a discussion of the “demand response” capabilities of smart appliances.
In spite of this backpedaling, it’s easy to uncover revealing quotes that elucidate the motivation behind the development of a smart grid:
- From a 2009 article inThe New York Times: “Someday utilities hope to use the [smart] meter to control consumption by major appliances like air conditioners.”
- Kevin Nolan, Vice President of Technology for GE Consumer, is quoted on the GE website as saying, “We believe with our Demand Response appliances, GE will help consumers significantly decrease power usage during peak demand periods, which will help the utilities reduce the need for more power generation and help consumers save on their energy bills.”
- From a smart grid website set up by the U.S. government: “A key element that allows all of the emerging Smart Grid technologies to function together is the interactive relationship between the grid operators, utilities, and you. Computerized controls in your home and appliances can be set up to respond to signals from your energy provider to minimize their energy use at times when the power grid is under stress from high demand, or even to shift some of their power use to times when power is available at a lower cost. … This is more complicated than a simple on and off switch. For instance, a smart air conditioner might extend its cycle time slightly to reduce its load on the grid; while not noticeable to you, millions of air conditioners acting the same way could significantly reduce the load on the power grid.”
- From a manufacturer of control systems: “DR [demand response] programs can be automatic, with utilities having the right to reduce or turn off certain energy-consuming appliances for a short amount of time at customer sites, such as air conditioners, pool pumps, and hot water heaters. …In a true ‘press and play’ environment, HAN-enabled devices such as appliances can be connected to the HAN simply by plugging in the appliance to the electricity outlet and then pressing a button on the device. … By embedding intelligence in every device, there is no need for expensive controllers to manage devices.”
- From an article on the website of the American Radio Relay League: “Home Area Networks are consumer portals that link ‘smart meters’ to controllable electrical loads (‘smart appliances’). Its functions can include … control of loads without continuing consumer involvement.”
- From an article in the Wall Street Journal: “Smart appliances can be controlled remotely by a power company to go into energy-saving mode or shut off during times when there is high demand for electricity. Consumers could override the feature but likely will pay more for power during these periods. … … Smart appliances will come equipped with communications modules and software. During grid emergencies or periods of high electricity use, utilities could ping smart meters or other devices, such as home-network controllers, to order appliances to hunker down in energy-saving mode. Whirlpool’s smart dryers, which will account for a quarter of the company’s expected 2011 production, will be able to operate in a variety of modes. In one energy-saving mode that might be used when electricity demand is high, the heat will turn on and off during an extended drying cycle but the spinning will continue to prevent wrinkles.”
- From an article one the website of the HomePlug Alliance (a group of companies working to develop technology specifications powerline networking): “[Smart grid technology] helps consumers participate in peak demand shut down programs, with price incentives to allow the Smart Grid to automatically cut electricity usage for non-critical devices during spikes in demand.”
Remote control — but for whom?
Once a homeowner decides to install a web-integrated appliance can can be remotely controlled — for example, by a smart phone — the question arises: can utilities take advantage of that remote control capability?
In most cases, the answer is yes — although utilities take pains to point out that they would never use the capability without the permission of the affected homeowner.
For example, an online news release touts the advantage of a “home manager app [that] enables remote control of GE’s Brillion-enabled appliances.” The news release emphasizes homeowner control: “General Electric Co.’s new line of Brillion-enabled products … aim to give consumers more control over home-energy usage with GE’s Nucleus Home Manager iPhone app.”
There have been several elements to the backlash against the installation of smart meters, including worries about the health effects of electromagnetic fields, worries that terrorists might gain control of homeowners’ appliances, and privacy worries.
Perhaps the most complete report on this last concern is “Smart Privacy for the Smart Grid,” a paper written in November 2009 for the Information and Privacy Commissioner in Ontario. Because the report is well written, it’s worth quoting at length:
“Customers’ relationships with power utilities are generally borne out of necessity — unless an
individual can generate their own power, they must either obtain power from a utility or go without it. The expectation, however, is that the utility will supply electricity only, and not to monitor customers’ behaviors and activities. Much in the same way that we do not expect the postman to look inside our windows when he is delivering the mail, or the cable person to monitor the TV shows we watch after he has completed the cable installation, so too do customers not expect there to be any surreptitious profiling of their in-home energy-related behavioral patterns. …
“For example, it is suggested that the following information could be gleaned with the introduction of end-user components (these issues will become more practical concerns as appliances and devices become part of the grid): Whether individuals tend to cook microwavable meals or meals on the stove; whether they have breakfast; the time at which individuals are at home; whether a house has an alarm system and how often it is activated; when occupants usually shower; when the TV and/or computer is on; whether appliances are in good condition; the number of gadgets in the home; if the home has a washer and dryer and how often they are used; whether lights and appliances are used at odd hours, such as in the middle of the night; whether and how often exercise equipment such as a treadmill is used. Combined with other information, such as work location and hours, and whether one has children, one can see that assumptions may be derived from such information.
“For example: the homeowner tends to arrive home shortly after the bars close; the individual is
a restless sleeper and is sleep deprived; the occupant leaves late for work; the homeowner often
leaves appliances on while at work; the occupant rarely washes his/her clothes; the person leaves their children home alone; the occupant exercises infrequently.”
Utilities now downplay the “demand response” capabilities of smart appliances
Now that utilities are facing a strong backlash against smart meters — the protest movement includes anti-smart-meter websites — electric companies rarely mention the “demand response” capabilities of smart appliances.
In “Anatomy of a Demonstration Pilot: Smart Grid Appliances Case Study,” a 2013 presentation by Jolyn Newton, the author notes, “GE and other appliance manufacturers are moving away from utility control for grid stabilization and energy optimization and toward consumer [applications] … enabled through smart phone apps.”
An article in Intelligent Utility magazine quotes John McDonald, the director of technical strategy and policy development at GE Digital Energy. McDonald is well aware of the danger of missteps by the manufacturers of smart appliances. The article notes, “How appliances communicate with a control hub or with each other also remains to be worked out. Two things AHAM [the Association of Home Appliance Manufacturers] members are adamant about, according to Smith: consumers must be able to override any energy-saving commands issued by the utility … Of course, with demand response and dynamic pricing in their infancy, smart appliances and home networks remain a work-in-progress. … ‘On the consumer side, I don’t want to rush,’ McDonald [said] recently. ‘I want to take baby steps, because we do not know [yet] how to engage consumers. We don’t know what technologies we should put together. And I don’t want to have even one big misstep, because it takes a lot of successful projects to overcome that one bad project. So let’s take our time.”
Many states have set up informational websites that try to reassure homeowners that smart meters are harmless, and nearly all of them now emphasize that homeowners will remain in control of their appliances. For example, a smart grid website maintained by the state of Michigan announces, “Smart appliances will be controlled by the homeowner and NOT the utility, leaving the decision of when an appliance operates in YOUR hands.”
The same issue is addressed by a website maintained by the state of Ohio, which answers a frequently asked question this way: “Will the electric company be able to control customers’ electricity usage? The purpose of this technology is not to give control of electricity usage to the power company but rather to make customers more informed and allow communication between customers and their utilities. … Smart grid … empowers customers by putting them in control of their usage.”
Who benefits most from time-of-use billing?
As smart meters get installed in many communities, homeowners are asking, “What’s in it for me?” The usual response from utilities is, “As soon as we get enough of these smart meters installed, we’ll be offering time-of-use rates that may save you money on your energy bill.”
There are two problems with this argument.
One is that most utilities aren’t yet offering time-of-use rates to homeowners.
Another is that even in communities that have implemented time-of-use billing, most homeowners aren’t seeing advantages to the new system. After all, most people don’t want to do their laundry after midnight. In some cases, homeowners with time-of-use billing have seen their monthly bills rise, not fall.
While peak load reduction is a problem for utilities, it isn’t really a concern for most homeowners. That makes smart meters a very tough sell.
Information is valuable
If the most expansive vision of the smart grid — one that includes the deployment of smart appliances — is ever fully implemented, the grid will produce massive amounts of data. That data will be highly valuable to researchers.
But the data will also be highly valuable to marketers — for example, marketers who are eager to know which homeowners have old refrigerators or balky air conditioners.
By now, most of us know why Google offers us free gmail accounts. Google doesn’t do it as a public service; the company does it because it wants to read our e-mails. The data that is mined from scanning our e-mails is enormously valuable to marketers, and Google is making a tidy profit by selling it.
My reference to Google isn’t just for purposes of illustration, since Google has a finger in this pie. This year Google paid a whopping $3.2 billion to buy Nest Labs, the manufacturer of a web-connected thermostat that has amassed boatloads of data on the energy-use practices and daily habits of U.S. homeowners. (Since Nest thermostats include motion detectors, they inform Google when homeowners come home from work and go to bed.)
It’s not a utility conspiracy
I am not a conspiracy theorist. I don’t believe that evil utility executives are conspiring to gain control of our washing machines and clothes dryers.
Nevertheless, the rollout of the smart grid in the U.S. and Canada has been a textbook case of flawed public relations. Utilities have been tone-deaf and oddly blind to homeowner concerns.
In theory, a smart grid connected to smart appliances could give utilities remarkable flexibility in handling peak load problems, and could result in substantial energy savings. However, just because engineers are capable of designing a system that achieves these ends, doesn’t mean that we should do it.
The rollout of smart grid technology comes at an historic point for electric utilities in the U.S. The smart grid was conceived at a time when peak loads were straining the capacity of many utilities. Times have changed, however. Many U.S. utilities now have too much generating capacity, and electricity use is declining in some areas. At the same time, the precipitous drop in the cost of photovoltaic modules has set the stage for revolutionary changes to our grid. Many analysts now predict that electricity prices are likely to drop over the long term.
Growing anger at the big-brother aspects of smart grid technology could easily manifest itself in a growing demand for dumb appliances. Some homeowners may even be tempted to go off-grid, an option that is likely to become increasingly attractive as cheaper batteries make electrical independence more feasible.
Moving our appliance switches to the cloud
In the old days, we kept our pictures in photo albums, and we stored the photo albums on our bookshelves. When Americans began switching to digital photography, we stored our photos on the hard drives of our home computers and CD-ROMs.
In the last few years, however, Americans have begun to move their family photos to the cloud. Time will tell whether the vast amount of personal data now being stored in the cloud will remain protected from hackers, from marketers who are eager to identify new customers, and from unexpected computer glitches.
Manufacturers of refrigerators and washing machines are now asking us to move our appliance switches to the cloud. The purported advantage to homeowners is the ability to use our iPhones to activate our appliances from a remote location. This questionable benefit is balanced, of course, by all the risks associated with cloud-based control.
Will Americans eagerly buy smart appliances, or will they clamor instead for dumb appliances? The answer is uncertain; stay tuned.
Martin Holladay’s previous blog: “Geothermal Energy and Narrow Streets.”