Customers and 'Big Ideas': what it's all about

Readers keep us honest on bold assertions

Phil Carson | Apr 26, 2012


Call it spring fever if you will, but readers weighed in on two major issues we presented this past week, setting us straight and sharing their insights.

In "Customers Need Energy Data First," I looked at research into customer engagement strategies presented to the National Association of Regulatory Utility Commissioners (NARUC) by Roger Levy of Levy Associates, which worked in conjunction with the Lawrence Berkeley National Laboratory's Smart Grid Technical Advisory Project.  

The fundamental finding presented was that in-home displays are essential. The fact is, "it's the energy use information, stupid." (My paraphrase, not Levy's.)

"I hope the decision-makers who determine what gets done and how it ultimately gets paid for are reading this article and thinking hard about what it says," wrote faithful contributor and consulting engineer Jack Ellis. "We don't need to have utilities invest billions of dollars in devices that get installed and gather dust. I also agree with Levy that there's absolutely no reason for customers to be limited in any way by the type of device they rely upon for usage and price information. In this [regard], consumer choice is necessary, it's feasible and it's paramount."

"I totally agree with the main points of this article," wrote Milton Scritsmier of Boulder, Colo. "A few years back I bought a Kill-a-Watt meter for around $25, which plugs between your appliance and the wall outlet and gives you accumulated energy usage info. By putting it on various appliances in my home, I quickly learned how much my PC, DVRs and stereo amplifier were adding to my electric usage. After that experiment which identified the power hogs, there was little to be gained from continual monitoring."

Greg Tinfow, CEO,  Energy Informatics LLC, was especially excited to read about Levy's findings.

"It's about time that somebody spoke up to power about what those of us fighting in the trenches have known for many years: the value of real-time feedback is overrated and un-actionable for most people," Tinfow wrote in our forum. "I've been having this argument at conferences for more than a dozen years, and continue to have it, even on Energy Central, with people who try to spin inconclusive or minimal results into big wins.

"A two percent reduction in electricity usage (cited elsewhere on Energy Central), although material to some people, is not a big win; 35 percent is," Tinfow continued. "That's the level that the Rocky Mountain Institute was able to help squeeze out of the Empire State Building's energy use, and less than I have achieved over the past three years in my own home. It wasn't real-time feedback that yielded these gains, it was data collection coupled to rigorous analysis and prioritization of which actions would yield the fastest payback.

"Those who have read my periodic rantings on this site can probably sense my frustration about the sorry state of information provided to customers by their energy providers," Tinfow concluded. "People really don't care about kilowatt hours and electricity usage profiles, they care about money and the environment. They need clear metrics for how their behavioral changes will translate into dollars, or societal benefits. They want to know which things to spend money on and how long before they pay for themselves."

On Tuesday, in "Big, Bold New Ideas for Utilities?," I noted the snarky pushback against the aforementioned Rocky Mountain Institute (RMI), which has worked with major utilities at the latter's request and, indeed, helped the owners of the globally iconic Empire State Building to cut one-third of that enormous building's energy use. What's not to love? Apparently, big, bold new ideas. The most closed minded response I got was a backchannel claim by a gentleman who "deals in facts" only and eschewed ad hominem attacks while characterizing the RMI as "radical environmentalists." (Perhaps this is just a warm-up to the presidential election this fall.) 

Of course, I had to suggest that big bold ideas were  being pushed by the utilities, not third parties. Where did I get that idea? (Jim Rogers, CEO of Duke Energy, invited the RMI to help him chart his utility's future.) But our new correspondent Milton Scritsmier of Boulder was having none of it.

"I disagree," Scritsmier wrote in our forum. "The move towards renewables wouldn't be happening without renewable mandates by many states and recent moves by the EPA. Ultimately the utilities don't care because their ratepayers will finance whatever changes are necessary and the regulated utilities will still make their guaranteed profit. Why fight when you can still win by embracing it? Last year Xcel in Colorado got the ratepayers to finance the closing of old coal plants that were getting harder to maintain and replacing them with shiny new efficient plants running cheap natural gas. Sounds like a good deal to me.

"I'm not against renewables," Scritsmier assured our readers. "One day we are going to have to move away from fossil fuels and everybody knows there will be failures along the way. However, while I'm not a power engineer, my background is in engineering, and for something as critical as our power supply nobody should ever advocate jumping head first into such unproven solutions on such a large scale. Rather than make a huge leap into the unknown, why not take it in steps by replacing coal with natural gas? I didn't like the strong-arm tactics Xcel used last year in moving from coal to natural gas, but it was a step in the right direction."

Hey, I didn't say it. You, our readers, did. And I'm glad for the broader perspectives, which are hard to find in my isolated cave.

Phil Carson
Intelligent Utility Daily

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Shift to renewables won't happen overnight...but...

Phil, thanks for initiating a great conversation. While I agree with Scritsmier that "jumping head first into unproven technologies" when facing something as important as our energy future is unwise, renewable energy sources like wind and solar are far from unproven technologies. In fact, RMI research shows that with today's technologies, renewables have the technical potential to provide at least 80% of the electricity needed (keeping in mind efficiency gains achieved in transportation, buildings and industry) by 2050. This finding will be supported by an NREL report soon to be released mid-May.

The energy choices we make today need to be informed by a long-term vision of what services we want to deliver, and the safest (for national security and human health), most risk-averse, and flexible way possible. Today's system is aging, but technological advances and innovative IT have opened up new choices, and global growth in renewables is driving cost reductions. While natural gas may be a cheap and lower-carbon transition, its volatile costs make it less attractive in the long-term than a customer-centric electricity system that is efficient, renewable, and distributed.

While barriers remain, this is the direction that leading--and even unexpected utiltiies are moving. Working together with different players in the value chain is critical to make sure the regulatory environment and business models match up to support a common long-term goal.