Regulator failed to monitor Con Edison - report
Tue Jan 30, 2007 3:40am ET
NEW YORK, Jan 30 (Reuters) - A large decline in the number of staff at the New York State Public Service Commission contributed to its failure to adequately monitor power company Consolidated Edison Inc. (ED.N: Quote, Profile , Research), according to a State Assembly task force report cited by The New York Times.
The report is a response to a blackout that struck the borough of Queens in New York City last July, cutting power to more than 174,000 people at the height of a heat wave.
An Assembly member provided a copy of the report to the Times on Monday, the paper reported in its Tuesday edition. It is scheduled to be released on Tuesday, the Times said.
In a report of its own released earlier this month, the State Public Service Commission concluded that Con Edison's failure to properly maintain and operate its electricity network was the primary cause of the blackout.
In the report obtained by the Times, the task force found that the commission had about 800 employees when George Pataki began the first of three terms as governor, the Times said. Now, partly due to deregulation, it has about 550 employees, the paper said.
The task force also recommended that the state review Con Edison's monopoly every 10 years, the Times said.
The report agreed with the state commission's report that Con Edison undergo a formal proceeding, which could result in financial penalties, the Times said.
It also recommended that Con Edison spend $20 million over three years to develop an electrical grid in western Queens that would use energy more efficiently and permit the company to better monitor its use, the Times reported.
State Public Service Commission officials could not immediately be reached for comment.
Tuesday, January 30, 2007
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'Smart meters' could generate ways to save on electricity
ReplyDeleteBGE is testing devices that would reward less use
By Paul Adams
sun reporter
Originally published January 7, 2007
Imagine an electricity meter that can pinpoint power outages, automatically turn household appliances off when wholesale electricity gets too expensive and - with enough of them in use - possibly reduce the need for new power plants.
All rank among the potential benefits of so-called smart meters, which are fast becoming the darling of the utility industry as state and federal regulators push power providers to cut energy costs. Utilities are turning to the devices as they struggle to meet demand, which in some areas is expected to outpace construction of new power plants and transmission lines. The meters average about $100 or more per household to install, but advocates insist that consumers will save much more than that in power costs over the long run.
Baltimore Gas and Electric will join the movement this year as it begins testing meters that, among other things, could save customers money by rewarding them for using less power during times of peak demand, as on hot summer afternoons. The technology works in part by making it possible for utilities to measure a customer's power use on an hourly basis without the need for meter readers, who must head into residential neighborhoods to collect the data.
Many experts say the trend reflects a growing realization among utilities and policymakers that cutting demand might be a faster and more effective way to bolster the nation's aging power grid than building new plants. It also represents a seismic change in thinking for utilities, which have historically seen their profits linked to how much electricity they sell.
"It costs less to not use electricity than it does to construct new generation," said Ray Dotter, a spokesman for PJM Interconnection, which manages the power grid for Maryland, the District of Columbia and 12 other states. PJM supports the use of smart meters as a way to balance energy consumption in the grid.
Though critics worry that utilities are pouring billions of dollars into technology that would be better spent on conservation, most agree that benefits are to be gained from smart meters.
Currently, most residential customers pay the same electricity rate day after day no matter when energy is used, even though the true price of power can change drastically throughout the day and year.
A key feature of smart meters is the ability to record a customer's energy usage hourly and then send that data back to the utility over low-voltage power lines or through wireless transmission. The technology eliminates the need to have meter readers go out into neighborhoods to collect the data - a function performed by BGE employees.
Once smart meters are installed, a utility could use the data to offer customers different rates for using power at different times of day. That would allow utilities to greatly expand and enhance their existing "time-of-use" programs, which could help consumers save on electricity costs.
The financial incentive is designed to encourage customers to reduce demand when energy is needed the most. Most industrial customers already use such an approach, often employing energy consultants to tell them when to curtail usage to achieve the greatest savings. Currently, too few residential households enroll in the time-of-use programs to have a major impact on the power grid. But with residential rates soaring, utility officials say they believe more homeowners will be willing to sign up for such programs.
Some regulators see a day when time-of-use rates will be the norm rather than the exception. For example, Pacific Gas and Electric Co. in California has begun installing 10.3 million smart electric and gas meters in every home in its service territory. The effort will cost $2.2 billion over 20 years and be funded by ratepayers.
The movement got a boost from the Energy Policy Act of 2005, which ordered states to investigate the potential implementation of such "demand response" programs. Those studies are under way in Maryland and elsewhere.
Done right, proponents say, demand response programs can shave as much as 10 percent to 15 percent off customers' bills by rewarding them for shifting certain tasks - such as washing dishes or doing laundry - to early morning or evening hours. State and federal regulators say the potential for savings might be greatest in the Mid-Atlantic, where a shortage of transmission lines can send wholesale power prices soaring during a heat wave. Wholesale power that might normally sell for $60 to $100 per megawatt within PJM can briefly climb to more than $1,000 on exceedingly hot days.
"The good news is that when markets are tight - like they have been in the PJM - even small changes in demand can have a big effect in reducing the wholesale price of electricity," said William R. Prindle, deputy director of the American Council for an Energy-Efficient Economy in Washington. BGE has consulted with the energy policy group on conservation programs it is developing.
BGE plans to launch a pilot program to test new meter technology as part of a broader energy management strategy that will include conservation. The initiative comes in the wake of a 72 percent rate increase that resulted in part from rising wholesale energy prices.
"We are looking at ways to better help our customers manage energy costs and usage, and there are various programs out there to do that," said Linda Foy, a spokeswoman for BGE.
The company said the scope and details of the program are being worked out, but it is expected to touch all 1.1 million of its customers. Pepco has proposed a similar pilot program in Washington, where it hopes to outfit the homes of 2,250 customers with smart meters. The plan is awaiting regulatory approval.
Experts say lowering demand even a few percent or less at critical times means some power producers don't have to turn on their most expensive natural gas and oil generators to meet demand. Such "peaking" plants often operate fewer than 100 hours a year but can have a disproportionate effect on the wholesale price of electricity.
However, critics note that shifting power usage to different times of day will not reduce - and might even enhance - the need for baseload coal and nuclear plants, which come with environmental costs.
"Before any utility spends billions on massive new metering technology, they ought to be spending that money on energy-efficiency programs," said Martin Kushler, director of utility programs for the American Council for an Energy-Efficient Economy.
more: http://www.baltimoresun.com/business/bal-te.bz.meters07jan07,0,3322877.story?page=2
http://www.dallasnews.com/
ReplyDeletesharedcontent/dws/bus/stories/DN-smartmeters_31bus.ART.State.Edition2.29a59cb.html#
Electricity rates may start going by the clock
Smart meters could let TXU, others charge by time of day
12:00 AM CST on Wednesday, January 31, 2007
By ELIZABETH SOUDER / The Dallas Morning News
esouder@dallasnews.com
By the end of this year, some electricity consumers in North Texas may have the option to save money by using power in the evening rather than during the day.
Thanks to a major power line upgrade that starts this week, electricity companies could charge different rates based on what time of day electricity is used. Customers who sign up for such pricing plans could get rock-bottom prices at night and on weekends but pay a hefty premium for power during peak hours.
Consumers will be able to monitor their electricity use and charges in real time, and some will be able to connect to the Internet through power lines.
This week TXU Corp. began installing the initial 10,000 smart meters in Dallas. The new meters are a key piece of a four-year technology upgrade that will turn North Texas power lines into a communications network.
"It's a communications network that we lay over the electricity network," said Jay Birnbaum, vice president for Current Communications Group, which created a partnership with TXU last year to help install and operate the new technology.
"We can talk to our equipment that we install throughout the network. We can talk to a modem inside your house if you're a broadband customer. And we can talk to a meter on the side of your house," he said.
Experts say the new technology could change the entire power industry. It will automate meter reading and help TXU Electric Delivery respond to power outages more quickly.
Generation costs go down, because consumers have an incentive to use power during off-peak hours, when it's cheaper to produce. And that means the state could need fewer new power plants to meet peak demand.
When experts talk about what the technology could one day mean for consumers, they describe an energy Utopia, a "House of Tomorrow" in which a consumer uses a Web site to control household appliances, turning on the air conditioner or the oven remotely before leaving work, setting the dishwasher to start when electricity prices drop, or putting the freezer on a strict electricity diet.
Making the switch
It all starts with new meters.
TXU Electric Delivery, the regulated wires-and-poles unit of the Dallas power company, began installing smart meters Tuesday in homes and businesses in Lakewood and surrounding neighborhoods. The trial installation will take about three weeks.
Each installation takes a couple of minutes. Spokeswoman Carol Peters said TXU will leave door hangers explaining the technology. If workers can't reach a meter behind a fence or inside a house, they will leave a hanger asking the owner to call and make arrangements for the switch, she said.
TXU plans to upgrade 300,000 meters in the Dallas-Fort Worth area by the end of the year. And by 2011, the company expects to have spent about $450 million to change nearly 3 million meters in its service territory.
All of the new meters will be automated, and many will have broadband-over-power-line technology, including those in Dallas, Fort Worth and some suburbs.
The new system will read electricity meters 96 times a day. And TXU Electric Delivery will create a Web site where consumers can check their electricity use in real time, Ms. Peters said.
Eventually, Current, which is adding technology to the wires as TXU upgrades meters, will offer broadband Internet service over power lines to consumers. Mr. Birnbaum declined to say when. He said the company will probably roll out the service in individual neighborhoods as the technology upgrades are completed.
The cost of the new technology could trickle down to consumers if state regulators allow TXU to increase the amount it charges electricity providers for using power lines.
Customer's viewpoint
Some TXU Energy customers are already testing a simple time-of-use product.
The company launched a pilot program last year charging 11.9 cents per kilowatt-hour during mornings, nights and weekends, and during the winter. But May through October, between 1 p.m. and 6 p.m. on weekdays, the price soars to 29.8 cents per kilowatt-hour.
Edith Omberg, a retiree in Hillsboro, signed up for the program because she thinks she can save some money next summer. She said she's already become more strict about electricity use as prices have risen.
"It may be some work, aggravation even, you know," she said. "And I'm retired; we will be home. But I think I can do it."
She plans to set her temperature above 80 degrees during the afternoons and do her laundry in the mornings.
"We have energy-saving light bulbs, you know, and if I can keep the husband from leaving the hall light on all the time whether he needs it, this sort of thing, I think we'll do well," she added.
TXU Energy spokeswoman Sophia Stoller said the company will roll out the pricing plan to more customers this year.
She said executives will reset the prices to keep them competitive. Since the pilot program began, some retailers have begun charging less than 11 cents per kilowatt-hour all day long.
Other electricity providers are considering whether to offer their own time-of-use pricing plan to compete with TXU Energy. Once the new technology is installed, competing providers could create their own time-of-use pricing plans, collecting the data generated by the new meters and billing customers accordingly.
Matthew Benner, senior vice president of retail marketing and operations for Reliant, said he's thinking about offering such a system. He likes the idea of giving consumers an incentive to use energy at a time when demand is usually low and power costs less on the wholesale market.
"Time of use is just a fabulous idea. The cost to provide power during the peak is just a lot higher than providing power other times of day," he said.
During peak demand times, electricity generators must fire up their older, less efficient generators to meet demand. That boosts the wholesale market price. When demand dies down in the evening, power companies can rely on more efficient plants, and market prices drop.
Foreseeing confusion
But other people in the industry worry that charging different prices could be too confusing for some consumers who are still getting accustomed to the deregulated market.
Brent Moore is head of SaveOnEnergy, a Web site that helps consumers choose electricity plans. He thinks the time-of-use system is the future of the industry, but it's a little early for most consumers.
"If I get a customer on the phone today that was with TXU for 60 years and I was trying to convince them to switch, and I tried to offer them that product, I would get a deer in the headlights," he said.