A smart electricity meter with dollar amount. Photo is a promo image from Rainforest Automation

The way Nova Scotia Power measures electricity consumption relies on a worker coming to your home to read the meter once every month or two. In the rest of Canada, the meters have gone digital and are using Advanced Metering Infrastructure (AMI) to allow two-way communication via a wireless network to provide a continuous flow of information from the house to a data centre managed by the utility.

The new “smart” meters will benefit NS Power’s online customers by providing more information about energy consumption that may encourage people to dial back or change the way they use electricity at home. Some meters are smarter than others, as we reported on Friday, and meters equipped with Zigbee radios can also relay consumption by home appliances in “real time.”

These are not the “smart” meters NS Power is proposing to buy, raising questions about why the utility would change out 495,000 meters without choosing the most up-to-date technology. In its defence, NS Power says the product it has chosen has the flexibility to allow for home monitoring in the future. If so — and at least one energy consultant remains skeptical — home monitoring systems will be added at the homeowner’s expense.

NS Power states its smart meters will reduce the cost of electricity by $38 million over the meters’ projected 20-year life. It says consumers will use 0.75 per cent less electricity each year — partly as a result of receiving emails and texts advising them they are about to hit or exceed their budgeted monthly limit for electricity, a practice Bell uses with cellphone users. NS Power says the flood of information released by the new AMI meters will give the company the opportunity to design new pricing that would reward customers who use less energy — although the company expects that would take three years to implement.

EfficiencyOne is the utility the province created in 2010 to manage energy conservation programs in Nova Scotia. It is mandated through the Public Utilities Act. By 2020, its goal is to see Nova Scotians using 30 per cent less energy. EfficiencyOne  supports the move to smart meters but suggests it would be like putting the fox in the hen house (my analogy) to allow NS Power to manage any energy conservation measure, including sending out “bill alerts” to its online customers.

The problem, says Efficiency One in its submission to the Utility and Review Board, is conflict of interest:

It is broadly acknowledged within the electricity utility industry that Investor Owned Utilities have a disincentive to make meaningful investments in energy efficiency programs. The American Council for an Energy-Efficient Economy (ACEEE) states: “As long as utility revenues are a direct function of energy sales, there will be an incentive for the utility to increase ‘throughput’ by selling more electricity or natural gas. Utilities have a fiduciary responsibility to their shareholders to earn profits and yield appropriate returns to these investors. Thus there is an inherent conflict between corporate financial objectives and the energy savings objectives for utility energy efficiency programs.”

It’s for those reasons EfficiencyOne is proposing to take over the management of any conservation program spun off from the smart meters, including emailing the “bill alerts” to NS Power customers. (In hindsight, it’s interesting to recall the UARB had been called in to referee a turf war between NS Power and EfficiencyOne over how much customer information could be shared between the two rival utilities.)

Here are the four recommendations EfficiencyOne has for the UARB as it considers the introduction of “smart” meters:

1. Permit the introduction of AMI technology on the basis it will enable the development and delivery of additional cost-effective electricity efficiency and conservation activities. EfficiencyOne urges caution in accepting the specific savings estimates that NS Power has proposed for its self-operated energy  efficiency programs.

2. Provide in any approval Order that NS Power is prohibited from developing and/or implementing any energy conservation programs that are enabled by the AMI technology, on the basis that: a. Such programs are in conflict with s. 79I(3)(e) of the Public Utilities Act; b. NS Power is in a direct conflict of interest with regard to the development and/or operation of energy conservation programs.  

3. Direct that all energy efficiency and conservation programs enabled by the AMI  technology are to be designed and operated by the Efficiency Nova Scotia (ENS) franchise holder. 

4. Direct that NS Power is required to allow broad access to the AMI network by the ENS franchise holder, as it is required for the identification, development and delivery of electricity efficiency and conservation activities. 

In 2014, legislative changes required that conservation initiatives be provided to NS Power by EfficiencyOne for a 10-year period. The cost of these activities is already included in the power rates we pay.

Other written submissions to the UARB from three consultants hired by the consumer advocate and the regulator suggest that NS Power’s cost-benefit analysis of its smart meter program contains flaws. The consultants agree introducing smart meters won’t save consumers the $38 million estimated by NS Power but their own cost estimates range from a low of a few million dollars to $60 million.

Jennifer Henderson is a freelance journalist and retired CBC News reporter.

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