News and analysis about energy in California with an eye toward renewables.

Are Smart Meters A Waste of Money?

Cover image from Getting Smarter About the Smart Grid | Image: National Institute for Science, Law and Public Policy

Smart meters are hyped as a necessary component of a modern "smart" power distribution grid, crucial if we're to make our electrical infrastructure better able to conserve energy and cope with intermittent renewables. But a report released last week challenges that view of smart meters, charging that the costly appliances -- paid for in large part with Stimulus funding -- serve mainly to increase utility company profits.

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Written by Timothy Schoechle, Ph.D. and published November 26 by the National Institute for Science, Law and Public Policy, the report -- "Getting Smarter About the Smart Grid" -- poses a challenge to the usual arguments in favor of smart meters that you'll read in renewable energy news stories. (Including here at ReWire.)

Schoechle, a former faculty member of the University of Colorado College of Engineering and Applied Science, has worked in the computer and communications engineering and energy utility spheres for 25 years, including work with the International Organization for Standardization.

Smart grid technology is crucial. If we are to get off the fossil fuel energy treadmill, our grid will indeed need to be much smarter than it is, more flexible and responsive. It's unlikely that we'll make our grid sustainable, for instance, without demand-response measures such as the ability to, say, switch household freezers off for four or five minutes at a time during peak demand times. (Social engineering public acceptance to measures like that will be interesting, of course.)

A smarter grid will also make it easier to generate more power locally, which in turn lowers the grid's vulnerability not only to mechanical failure, but to the sort of speculative market gaming that has enriched companies such as Enron to the detriment of ratepayers.

But according to Schoechle, the current crop of smart meters don't do anything to get us closer to a smart grid:

Data to be collected by the smart meters, including intimate personal details of citizens' lives, is not necessary to the basic purpose of the smart grid -- supply/demand balancing, demand response (DR), dynamic pricing, renewable integration, or local generation and storage -- as promoters of the meters, and uninformed parties, routinely claim. Instead, the meter data is serving to create an extraneous market for consumer data mining and advertising (i.e., "big data" analytics). Even those critical of smart meter deployments often seem to uncritically accept the myth that the meters somehow help manage electricity supply and demand.

Why are the utilities pushing the meters, then? Schoechle has an idea:

In reality, these meters and their dedicated networks are primarily for the benefit of utilities, reducing their operating costs and increasing profits by firing meter readers -- ironically with federal stimulus funds -- while doing essentially nothing to advance what should be the real goal of the smart grid: balancing supply and demand and integrating more renewable sources. Instead, the meter networks squander vast sums of money, create enormous risks to privacy and security, introduce known and still unknown possible risks to public health, and sour the public on the true promise of the smart grid.

What are those health effects? Schoechle exhaustively describes the controversy over the alleged health effects of radio frequency emissions by smart meters in an even-handed style that will likely peeve those on several different sides of the issue. Though he shies away from alleging that smart meters cause the range of health ailments that have been attributed to them -- some of them wildly unlikely -- he does opt for a Precautionary Principle approach, pointing out that running a bit of cable to the meters could remove the argument altogether.

What does Schoechle advocate replace our current crop of smart meters? He does have an alternative, but those utilities wedded to Business As Usual practices won't like it much: break up monopoly control of the grid the way the Federal Government broke up the phone system a generation ago.

The most important policy and institutional change needed to bring about the transition to a new energy economy is the dismantling of the legacy "natural monopoly" electricity business model based on the "cost of service" regulatory paradigm. This transformation can be undertaken mostly at a state and local level and is accomplished by deregulating electricity generation -- enabling every user to be a generator, and possibly seller of energy back into the grid.

The local electricity grid (including the smart grid) is a public resource -- as are public streets or the water and sewer infrastructures -- and state and local legislators can act. Why should the grid be under the control of a monopoly utility? The traditional conception of "natural monopoly" was based on now-obsolete economies of scale in coal-based generation and transmission/distribution and large capital investment that characterized the early Edison companies. Distributed renewable and smart grid technologies have rendered the concept of natural monopoly policy no longer applicable, necessary, or beneficial for electrical generation and transmission.

Whether you agree with that perspective or not, the whole report is well-argued and well worth reading.

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About the Author

Chris Clarke is a natural history writer and environmental journalist currently at work on a book about the Joshua tree. He lives in Joshua Tree.
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Beware of smart meters - they are overbilling people using these, also smart meters cause illness in the occupants of the buildings where they are located. They do NOT save money nor energy, but are used to gouge the public. Smart meters also intrude upon privacy and track your movements inside the home. The data is sold to third parties. more info at and DO NOT ALLOW THE LOCAL UTILITY TO INSTALL SMART METERS.


Thanks for posting a link to Schoechle's paper, it is indeed a well produced argument. His "blueprint" for a new energy economy is an interesting proposal for long overdue transformation of the electricity syndicate.