Government Subsidizes Creation of a "Smart Grid" To Monitor/Control Energy Usage

[rambone]

Thanks Clif45 for the link.

If private utility companies offer this on their own, that is one thing.

When the Federal Government steps in - delivering taxpayer money or to administer energy oversight - I am against it.

It is not surprising to me that the push for this "smart meter" coincides with push of "Cap & Trade," the Federal Bill that allows the Government to ration energy usage and strangulate the American economy and homeowner.

Stimulus Grant to Cut Cost of BGE 'Smart Meters'

WASHINGTON - Baltimore Gas and Electric Co. officials said a $200 million federal subsidy awarded to the company Tuesday would lower the cost to customers of an ambitious project to provide every household with an advanced "smart meter" that will enable them to better control energy use.

BGE plans to install 2 million of the devices between 2010 and 2014 and charge customers for the upgrade. The smart meters would give BGE's residential and commercial customers hour-by-hour information about energy pricing and enable them to cut back at times of peak costs.

When the utility giant unveiled the initiative in July, it estimated the total cost at $500 million - with an average customer paying a $1.24 monthly surcharge over the 15-year life of the meters. The federal subsidy lowers BGE's initial price tag by 40 percent, a reduction that would be passed along to customers in the form of lower bill surcharges during the first five years of the program.

Because almost half the money for the advanced electric meters would now come from the federal stimulus program, BGE officials faced questions at a Baltimore news conference about how many jobs would be created and where those jobs would be located.

Mark Case, BGE's senior vice president for regulatory affairs, said the company had estimated in its grant application that the project would create 1,700 jobs in areas such as installing the meters and related equipment, as well as manufacturing the devices. He said BGE would be examining "buy American" provisions of the stimulus law to see how it might affect equipment purchases for the meters, switches, communications devices and software for building the "smart-grid" system.

Two companies that produced meters and communications equipment for a BGE "smart meter" pilot project, Aclara and Sensus, have manufacturing facilities both in the United States and in other countries, according to an Aclara official and the Sensus Web site. A Sensus spokesman did not immediately return a phone request for information.

The project would also eliminate all of BGE's meter-reader positions. Because the advanced meters would automatically be in constant two-way communication with the utility's central offices, BGE employees would no longer need to go house to house to gather information about energy consumption.

Case said the company's 115 remaining meter readers know that their jobs will be phased out and are already looking for other jobs within BGE or elsewhere.

The grant to BGE was one of 100 awards nationwide, chosen by the Department of Energy from among 400 applications and announced in conjunction with President Barack Obama's visit to a solar power plant in Florida.

The Potomac Electric Power Co. and Atlantic City Electric Co. were awarded a total of $168.1 million for smart meters and other devices for its operations in the Maryland suburbs of Washington and in other states. PJM Interconnection of Norristown, Pa., received nearly $13.7 million for equipment designed to reduce congestion on a 10-state regional power network that includes Maryland.

Obama called the $3.4 billion in stimulus grants "the largest-ever investment in a smarter, stronger and more secure electric grid."

BGE, whose parent, Constellation Energy Group Inc., is trying to close a deal to sell half its nuclear power business to a French utility, still must gain the approval of the Maryland Public Service Commission for the smart-meter initiative before it can receive the federal money.

The company initially estimated the cost of the project, which would be passed along to both residential and commercial customers of its electricity and gas service, at $500 million, without the federal subsidy.

Constellation's president and chief executive, Mayo A. Shattuck III, told reporters that BGE hopes to receive final approval from state regulators by the end of this year.

The BGE project was one of six to receive a maximum $200 million grant through the stimulus program. Company officials said the federal aid will mean a significant cost reduction for BGE customers.

Case said consumers would be able to save far more than the cost of the program by adjusting their energy consumption to avoid using electric devices and appliances, such as dishwashers and washing machines, at times of peak energy costs.

Customers in BGE's pilot program saved an average of $115 over a four-month period, Case said. Some independent studies have shown that savings decline as the novelty of the program wears off.

Overall, BGE has estimated that customers would save at least $2.6 billion overall once the program is in place.

BGE President Kenneth DeFontes called the federal grant a recognition of BGE's status as "a leader in smart grid technology" and "the superiority of our proposal."

Shattuck praised the seven Democratic members of the state's congressional delegation for the "essential role" they played in supporting BGE's application.

Industry analyst Mark McGranaghan called Shattuck's statement "a little weird." He said the Energy Department had gone out of its way to prevent outside influence from affecting the grant awards.

"The process was very structured," said McGranaghan, director of distribution research for the industry-supported Electric Power Research Institute. "I'd be very surprised if there was any politics involved."

He said BGE probably benefited from the fact that its proposal included dynamic pricing, which the Obama administration favors as a form of price transparency.

Under the BGE plan, customers could save money by conserving electricity on certain days between 2 p.m. and 7 p.m., a period of peak energy use during the summer.