Smart grid technology benefits everyone from utilities to consumers and a business case can be made for the large capital investment required to get us there.

That’s the message eMeter Co-Founder and CTO, Larsh Johnson gave Breaking Energy during a recent interview. Energy and infrastructure giant Siemens acquired eMeter in January 2012.

Distribution operators need to know how much water, power or natural gas is flowing through the grid at any given time and what portion of the grid is using each resource. Traditional meters can typically only provide total consumption data on a monthly basis, making it difficult to track how effectively each commodity is being used.

eMeter’s technology allows utilities to view consumption data – at the industrial, commercial and residential level – in 15 minute intervals. Once fully deployed, instead of aggregate monthly data, utilities will be able to read every meter every day and see how much energy is flowing to various parts of the grid at just about any moment. Around 30% of the utility meters currently operating in the US are “smart,” according to Johnson.

Early Adopters

Two of eMeter’s largest utility clients include the Independent System Operator of Ontario and Houston utility Centerpoint Energy. The cities of Burbank California and Jacksonville Florida are noteworthy because eMeter works with both the water and electric utilities.

In New York, Con Edison is starting a deployment program now that Johnson estimates will take about three or four years to complete. The top 3% to 5% of Con Ed’s largest energy consumers already have this type of intelligent metering in place and the utility is now looking to push it out to the rest of the market, which in total is over 3 million customers.

Energy Going Down the Drain

Around 15% of the water currently distributed through US municipal water systems is estimated as lost due to leakage. This number grows if you consider inefficient of ineffective water use, like conducting irrigation during the hottest part of the day. The situation is more severe when one considers that 30% of the cost to operate a municipal water system is spent on electricity, so wasting water means wasting power.

Around 15% of the water currently distributed through US municipal water systems is estimated as lost due to leakage

Smart meters are now monitoring how much water enters the system and how much comes out. The meters can also detect wasteful malfunctions within the system and problems at the customer end can be identified. Above average water usage at a residential location could indicate a problem that a meter would “notice” and be able to alert the utility about.

Making Wind and Solar More Efficient

To ensure utilities are efficiently distributing power, distributed energy resources like small-scale wind and solar need to be metered as they enter the grid. Given the intermittent nature of these resources, they also need to be monitored for reliability and availability. Smart metering helps accomplish this.

Smart meters can identify and regulate excess supply entering the grid from wind and solar sources. The granular data they provide can help formulate pricing mechanisms that encourage the use of certain resources during peak load times. Alternatively, a utility might want to incentivize wind usage during the evening when power demand decreases and wind activity tends to increase.

A Complicated but Compelling Business Case

Given expectations for strong global power demand growth over the medium to long term, eMeter sees opportunities in the US, Europe and Brazil. The company is also evaluating the Indian market, says Johnson.

High initial capital costs to deploy and operate eMeter’s technology can be justified by considering the operational and social benefits. The social benefits associated with a group of consumers becoming more efficient energy users do not directly strengthen a utility’s return on investment because that company is selling less of its product – whether it is water, power, natural gas or all three.

However, the net return is typically measured over a 15-year period and adding social savings into the equation reduces the overall payback period, according to Johnson. When people pay less for energy in a consumer-driven economy, they can spend more on other goods and services, providing a net gain to society.