FINDINGS

Avangrid electric delivery rates during peak period — between 4 p.m. and 6 p.m. — could triple with the introduction of 'smart meters."

Customers rejecting smart meters could be forced to pay an extra assessments on their monthly utility bills.

New York is trying to even out electric demand throughout the day to lessen dependence on fossil fuel electric generation.

If you’re still having trouble figuring how to lower your electric bill by shopping for a supplier, just wait until the next advance in utility deregulation comes to your home.

They’re called ‘smart meters,’ and they could upend the way you live, providing a jolt to how a homeowner uses electricity and natural gas.

Why?

Because if you are don't watch how and when you use electricity your utility bills will jump dramatically.

This brave new world of electric consumption, already in place in some parts of New York, Wisconsin, California and seven other states, is coming to your home sooner than you think, possibly within the next five years.

While promotional materials bill the new meters as a new more efficient way to monitor electric service by eliminating meter readers and allowing the utility to more accurately pinpoint power interruptions with two-communication, there is another more ominous feature: the ability change electric (and natural gas) prices throughout the day.

Called ‘time of use’ pricing, policies and procedures are still being developed. But in January customers in the Avangrid smart meter pilot program in Ithaca could find at least a partial introduction of time of use pricing unveiled on a volunteer basis. Avangrid is the parent of New York State Electric & Gas Corp. and Rochester Gas & Electric.

Under the new pricing formula, the weekday cost for electricity between 4 p.m. and 6 p.m. will rise dramatically.

In a limited distribution is a document filed with New York’s Public Service Commission in late June and obtained by the USA Today New York Network, the proposal by Avangrid will triple the price of bringing electricity to your home at the period of peak electric demand.

“If you are a good monopolist you’re going to charge the most when people need it the most,” said Noah C. Dormady, who studies energy policy as an assistant professor at the John Glenn College of Public Affairs at The Ohio State University in Columbus.

Currently, NYSEG charges about 4 to 5 cents a kilowatt hour to bring electricity to your home any time of day. That won’t remain if the full smart meter plan plays out.

Based on preliminary projections from plans in the Ithaca pilot program, the cost to bring electricity into your home during peak demand: 18 cents per kilowatt hour (the cost to run 10 100-watt light for an hour). Non-peak cost: 3 cents, according to paperwork filed with state regulators. After May, the peak price will rise to nearly 19 cents per kilowatt hour, while the non-peak cost will increase only slightly.

And that’s just the cost of distribution. Add the cost of the actual commodity purchased from NYSEG, RG&E or an independent electric supplier and peak power prices could run a homeowner as much as 25 cents per Kwh during peaks.

“Ouch,” said Frank J. Scollan, an Endicott resident who has schooled himself on the ins and outs of utility industry deregulation. “There’s a lot of people that are going to be hurt by this,” says a man who pays, on average, $200 a month for electric and gas.

It is all a part of a statewide initiative supported by state regulators to “improve overall system efficiency…mechanisms (that) will play a role in achieving the cleaner more efficient and consumer centric electric industry envisioned by Reforming the Energy Vision.”

Reforming Energy Vision is part of a statewide program designed to reduce carbon emissions and transition users to renewable energy sources. It has the support of Gov. Andrew Cuomo, but has been the subject of criticism by the state business lobby for moving too quickly, with the possible result of raising electric prices for customers who already pay among the highest rates in the nation.

The objective of Reforming Energy Vision: have at least 50 percent of the state’s power supply generated from renewable sources by 2030 and improving system efficiency. Each initiative, state regulators said, “will play a role in achieving the cleaner, more efficient and consumer-centric electric industry envisioned by REV.”

New York policy contrasts with Maine, where more than 600,000 smart meters were installed throughout the service territory of another Avangrid unit, Central Maine Power, at least four years ago.

No time of use pricing is in effect in The Pine Tree State.

“We anticipated once smart meters were in place the electric providers would be offering ingenuitive pricing in offering time of use rates,” said Derek Davidson, director of the consumer assistance division for the Maine Public Utilities Commission. “So far we haven't seen a great deal of interest in offering time of use.”

But there is no state directive in Maine like the Reforming Energy Vision in New York.

However, in the Sacramento Municipal Utility District, where time of use pricing is in effect for select customers, electricity — both commodity and supply — is priced at 32 cents/kwh between 4 p.m. and 7 p.m. between June and September, and dropping to 9 cents/kwh between 9 p.m. and 9 a.m.

"Rates are lower during off-peak periods because it costs us less to produce or purchase. Rates increase when both the demand and cost increase," the California utility informs its customers.

Controlling peak demand become critical in the summer. Thirst for power from air conditioning units across the state comes close to bringing the system to capacity. The state experienced its peak power demand in July 2013 when the load reached 34,000 megawatts. A review at power demand curves from the New York Independent System Operator, which runs the state’s electric grid, shows summer peak demand occurring between 4 p.m. and 6 p.m., with 4 a.m. its low ebb.

Utilities prefer smart meters because they automate the now costly and time consuming process of manual meter reading. Smart meters can be read remotely. Bob Kump, Avangrid chief executive, said meter readers will be given plenty of notice to find new jobs with either NYSEG or RG&E.

Ultimately, however, the new meters could result in a major restructuring in electric demand. By taking price cues available from directly from the meter, desktop of mobile apps, customers are expected to adjust their electric usage to even out demand throughout the day by taking advantage of off-peak deals.

“It’s called splitting the demand curve,” Dormady said.

By giving consumers price real-time pricing, energy regulators believe the peaks, which usually occur between 4 p.m. and 6 p.m. when people are getting out of work and just arriving home, will be lowered, as consumers shift demand to light demand periods when rates will likely be the lowest — the middle of the night when electric generators still operate but demand is the lightest.

'Smart meter' signals new era for utility customers

So be prepared to use those time delays on you washing machine, dryer, air conditioner, dishwasher or any other energy hogs in your home.

"A consumer who uses energy wisely could save money," said Craig Duncan, whose West Jay Street home in Ithaca became the first smart meter installation in the Ithaca pilot program.

For people who have had a difficult time event grasping the dynamics of selecting an independent energy supplier, however, this new frontier in energy supply will likely present a daunting challenge.

“My concern is that it is going to price some elderly people out of the market,” Scollan said. “They won’t know what hit them.”

Beyond the individual user, the rationale behind the state’s initiative is that by prompting customers to lower peak demand there be less need for more generation capacity even as electric usage increases. And by lower peak demand it may be possible for the state to rely more on sustainable energy sources such as wind, hydro and solar, and less on coal and natural gas.

In 2016, 45 percent of New York’s generating capacity was sourced from natural gas and fuel oil, 30 percent from nuclear and 20 percent from hydropower. Sustainable sources, such as wind and solar accounted for 5 percent of the state’s electric production.

Customers will be able to opt-out of smart meters, but it will cost them.

At Central Maine Power, customers with a smart meter without a radio signal – adapted for customers who believe the signals from smart meters are potentially health hazards – are charged a $20 one-time fee with an additional $14 tacked on to the monthly bill.

For those who prefer to retain their current electro-mechanical meter, there is a $40 one-time charge and a monthly $15.66 fee.

After the pilot program in Ithaca, NYSEG and RG&E plans to roll out smart meters to its 1.2 million customers across a wide swath of upstate New York by 2022. Kump said the utility expects to file a full rollout plan with state regulators next year.

While state regulators take in the larger picture of managing the state’s finite electric generation capacity and weigh it against global warming concerns, others wonder if they are forgetting the residential customer in the mix.

“Do we really want mothers who are trying to feed their children to become commodity traders?,” asks Dormady.

While Scollan, the Endicott homeowner, wonders if the typical utility customer knows what’s in store.

“These are punitive rates,” he said. “I really think people need to have a better understanding of what’s it all about.”

Findings

• Avangrid electric delivery rates during peak period — between 4 p.m. and 6 p.m. — could triple with the introduction of 'smart meters."

• Customers rejecting smart meters could be forced to payan extra assessments on their monthly utility bills.

• New York is trying to even out electric demand throughout the day to lessen dependence on fossil fuel electric generation.