April 29, 2015
Could smart meters be smarter? ComEd critics say yes
Commonwealth Edison calls smart meters a way to give households greater control over their power usage and costs.
But now that ComEd has installed more than 1 million of the gadgets in homes and businesses throughout the Chicago area, the utility is resisting efforts to require it to offer common money-saving rate options that smart meters make possible.
Consumer advocate Citizens Utility Board, along with the Environmental Defense Fund, have petitioned state utility regulators to look at requiring ComEd to offer rate options allowing households to shift more of their energy consumption to low-demand hours of the day and pay lower, off-peak prices as a reward.
These “time of use” products—for example, free energy on Saturdays or off-peak prices for nighttime energy use—have become more common in other markets as smart meters have taken hold. Smart meters, which give ComEd minute-by-minute information on customers’ power usage, make such offers possible. But they’ve been slow to take off here.
ComEd has moved for the Illinois Commerce Commission to dismiss CUB and EDF’s petition. The utility argues that it offers other rate options that give customers similar opportunities and that it’s moving to remove impediments to time-of-use offerings by competing suppliers.
But ComEd also seems to argue in filings before the ICC that the commission doesn’t have the authority to order it to offer such options itself. If anything like that emerges, it will be at ComEd’s time of choosing.
“ComEd does not currently offer the petitioner’s version of a TOU supply service, and cannot be ordered to establish one,” the utility stated in an April 10 ICC filing.
That, CUB believes, flies in the face of the spirit of the 2011 smart-grid law that allowed ComEd to substantially raise Chicago-area delivery rates via a formula that greatly constrains ICC review in order to finance $2.6 billion worth of grid upgrades, including the smart-meter installations.
“We need to maximize the value from the smart grid and part of doing that is offering more utility rate options for consumers,” CUB Executive Director David Kolata said in an email. “When you break down ComEd’s legal argument, it is essentially claiming that the ICC lacks jurisdiction over maximizing the value from smart grid investment, and we find this troubling and counter to the clear policy goals outlined in the law.”
Of course, unregulated suppliers are seeking to offer such products. To date, it has been hard for them to get data from ComEd to smooth the way for such offers. But both sides say there’s progress. The suppliers want the ICC to look at barriers to market development before reviewing whether to require ComEd itself to make such products available.
The trouble is, households, which increasingly had gotten their electricity from companies other than ComEd largely through buy-in-bulk programs overseen by their cities and villages, are being returned to the utility now that savings are hard to come by. The residential power market appears to be returning to the way it was before a few years ago, when anything innovative and new, for better or for worse, came from the utility.
“We would like to see the competitive market offer dynamic rates, but there is no reason to rely purely on alternative suppliers,” Kolata said. “Most residential consumers are customers of ComEd, at the end of the day, and this is particularly true now that cities like Chicago are moving back to the utility.”
ComEd already offers customers a real-time pricing program that charges them for energy based on hourly changes in the markets. Many households aren’t comfortable with the price volatility inherent in that program. About 10,000 participate.
The smart-grid law also required ComEd to offer “peak-time pricing.” Participants in that program get a bill credit for reducing their usage during the five highest-demand days of the year. About 60,000 of ComEd’s 4 million customers are enrolled in that.
“The CUB/EDF proposal seeks to force ComEd to offer a program that’s redundant of ComEd’s existing programs and that the ICC has previously declined to accept,” ComEd said in a statement. “It’s also inconsistent with existing (supplier)-sponsored competitive offerings. That’s why ComEd joined virtually all other parties in seeking a dismissal of this petition.”
Also seeking to dismiss is the staff of the ICC, which argues that the commission shouldn’t devote limited staff resources to an issue subject to questions of legal authority.