Smart Grid Legal News - High Voltage Insight on Smart Grid Issues

From energy storage to distribution automation, there are many things we can do to make the electric grid smarter. However, focusing on technology while overlooking the little things would be a big miss, or the equivalent to “air conditioning the entire neighborhood” as my mother would say when demanding I shut the door. Just in time for the holidays, DOE has released the Twelve Days of Energy Savings. It is a back to basics list of things we can do to be smarter energy consumers. Below is a view of some of the days. Warning: Take the advice for yourself. I have never wanted a home energy audit as a gift!  

Day 2: Install a Programmable Thermostat

Don’t pay for warm air that you aren’t using. By installing and setting a programmable thermostat, you can save money on your energy bills -- lowering your thermostat 10-15 degrees for 8 hours can save 5-15 percent a year on heating bills. If you are traveling this holiday, be sure to program your thermostat for energy savings.

Day 3: Maintain Your Fireplace

It isn’t the holidays without a crackling fire, but don’t let your energy bills go up with the smoke. Proper chimney maintenance -- like sealing your fireplace flue damper, caulking around your hearth, and installing tempered glass doors and a heat-air exchange system to blow warmed air back into the room -- will help keep warm air in your house and cold air out.

Day 4: Prepare Your Windows for Winter

Before you curl up on the couch in front of the window this holiday season, be sure to take steps to reduce heat loss. Weatherizing your windows can reduce drafts, and installing storm windows can cut heat loss through your windows by 25-50 percent. Explore more tips for saving energy on your windows.

Two years after providing approval to Florida Power and Light to install smart meters, the Florida Public Service Commission has decided to have a public workshop regarding the devices due to public outcry. Scheduled for September 20, 2012, the workshop will give the public the opportunity to provide comments regarding smart meters. The Commission has also directed its staff to gather additional insight about the technology, policies, jurisdiction, costs and benefits of smart meters. The information will be compiled and brought back to the Commissioners for further discussion. In its quest for information, the utility is asking some very good questions that any utility seeking smart meter deployment should be addressing. Below are the documents requested in Smart Meter Data
Request #1:

30. Please provide copies of any material(s) given to customers on smart meters.

31. Please provide any call center scripts on smart meters or smart meter opt-out.

32. Please provide any materials given to customers in response to their concerns about the health effects from smart meters.

33. Please provide the procedures for smart meter installation used by either the utility or contractors.

34. Please provide copies of any FCC regulations that smart meters must comply with.

My view is that public workshops and smart grid education in general are a great idea. Extensive consumer engagement has been a lesson learned the hard way for the trailblazers in an industry where consumer education is typically providing regulatory notices and bill inserts. For some reason, the smart meter is different and more is required. Given the ease with which information is available today, if utilities don’t educate their customers, someone else will. While the magnitude and message need to be balanced with the deployment schedule, I am of the general view that education should precede installation.

Facebook, the Natural Resources Defense Council (NRDC) and Opower along with 16 utilities recently launched a social energy app to help customers become more energy efficient. Leveraging the Facebook platform, the app allows people to quickly and easily start benchmarking their home’s energy usage against similar homes, compare energy use with friends, enter energy-saving competitions and share tips on how to become more energy efficient. With an initial reach of 20 million households, the effort is one of the most significant to date, enabling people to take action and become more energy efficient.

Although anyone can use the app by logging in with a Facebook account, customers within the 16 participating utilities’ territories listed below will be able to take advantage of the app’s “Utility Connect” feature, allowing customers to choose to have their energy use automatically update each month. These utilities and energy providers include:

• Austin Utilities (Minnesota)
• Burbank Water & Power
• ComEd
• Connexus Energy
• Consumers Energy
• Direct Energy (coming soon in 2012)
• Glendale Water & Power
• Loveland Water and Power
• National Grid (New York and Massachusetts)
• New Jersey Natural Gas (coming in 2012)
• Owatonna Public Utilities
• Pacific Gas and Electric Company
• City of Palo Alto Utilities
• PPL Electric Utilities Corp.
• Rochester Public Utilities
• Utilities District of Western Indiana REMC

Hey, where is my utility?! Okay, I am feeling left out of the coolest thing to hit the energy scene. Hopefully the list of participating utilities will expand. With the growing need for energy efficiency and customer engagement by utilities, this product is a home run…just in time for Opening Day!

On May 19, 2011, after taking into consideration all public correspondence and filings, the Maine Public Utilities Commission issued a Part 1 Order requiring Central Maine Power to implement an opt out program. What is interesting about the order is that it seems to go beyond addressing the RF issues and requires more than what is necessary to comfort those customers with smart meter health concerns. As stated in its press release, CMP will provide residential and small commercial customers with four choices:

1. the default smart meter which will become the standard meter in CMP territory;
2. the ability to select a smart meter with the transmitter-off;
3. the ability to keep the customer’s existing analog meter; or,
4. the ability to move the new smart meters elsewhere on their property at the customer’s expense.

This decision seems to be a long way from the Commission’s order in February 2010 where the Commission approved this very same CMP AMI program  that is now the subject of an opt out order that not only provides for the transmitter to be off, but even requires CMP to keep in use analog meters. In February 2010, the Commission stated that CMP’s AMI program would, “improve customer service, enhance storm restoration efforts, reduce utility operational costs, save ratepayer and utility costs, and ultimately provide customers with necessary tools to use electricity more efficiently.”  It will be interesting to see the extent of the anticipated reduction in utility operational costs as CMP maintains the systems and networks to support both analog and smart meters.

In Maine the Commission can issue an order in two parts. The first providing the decision and the latter providing the background, analyses and reasoning underlying the Commission’s decision. I’m looking forward to reading the Part II Order to see if it addresses my questions after reading the Part I Order:

• What happens when people move? It is possible that customers will relocate within and outside of CMP’s service territory. At some point, radio off customers will move into transmitter on homes or analog metered homes and vice versa.  Who pays for the administrative and operational cost of what will eventually become  an opt-in and opt-out mosaic with two subparts?
• Can CMP’s customers relocating within Maine but outside of CMP’s service territory expect to have the same opt-out option at their new home?
• Why have an opt-out option when the FCC and FDA have approved the smart meters for use?
• Analog? Really? When the analog meters are ready for replacement will CMP be required to purchase analog meters for the chosen few 10 or 15 years down the road? Admittedly, functional yet used meters should be on sale as other utilities abandon analog just like the FCC did with our television transmission.

The costs to customers for the various options will be:

1. For the electro-mechanical meter option: an initial, one-time charge of $40.00 and a recurring monthly charge of $12.00
2. For the standard wireless “smart meter” with the NIC operating in receive-only mode: an initial, one-time charge of $20.00 and a recurring monthly charge of $10.50
3. For any customer that does not enroll in the opt-out program within the 30 period specified above and later chooses to do so: a $25.00 surcharge. CMP may waive the surcharge if it determines there is a sufficient reason for the customer’s failure to notify CMP within the 30-day period

I suggest realtors in Maine begin to prepare new disclosure forms to alert potential buyers to the home’s level of smartness.

Entergy Corporation announced that two of its subsidiaries, Entergy Nuclear Vermont Yankee, LLC (“ENVY”) and Entergy Nuclear Operations, Inc. (“ENOI”) have filed a complaint in U.S. District Court for the District of Vermont seeking a judgment to prevent the state of Vermont from forcing the Vermont Yankee Nuclear Power Plant to cease operation on March 21, 2012.

The April 18, 2011 request for declaratory and injunctive relief follows the federal Nuclear Regulatory Commission’s (“NRC”) March 21, 2011, renewal of Vermont Yankee’s operating license authorizing the plant’s operation through March 21, 2032. The NRC’s action came after a thorough and exhaustive five-year safety and environmental review of the plant.

The lawsuit is primarily based on the following legal principles:

• “Atomic Energy Act Preemption. Under the Supremacy Clause of the U.S Constitution, the U.S. Supreme Court held in 1983 in a case involving Pacific Gas & Electric that a state has no authority over (1) nuclear power plant licensing and operations or (2) the radiological safety of a nuclear power plant. In violation of these legal principles, Vermont has asserted that it can shut down a federally licensed and operating nuclear power plant and that it can regulate the plant based upon Vermont’s safety concerns.
• Federal Power Act Preemption and the Commerce Clause of the U.S. Constitution. Vermont is prohibited from conditioning post-March 2012 operation of the Vermont Yankee Station on the plant’s agreement to provide power to Vermont utilities at preferential wholesale rates. The Federal Power Act preempts any state interference with the Federal Energy Regulatory Commission’s exclusive regulation of rates in the wholesale power market. The Commerce Clause of the U.S. Constitution bars a state from discriminatory regulation of private markets that favors in-state over out-of-state residents.“ Entergy Press Release

This battle between Entergy and the State of Vermont can be traced back to the 2002 Memorandum of Understanding (“MOU”) that settled the litigation related to Entergy’s purchase of Vermont Yankee from Vermont Yankee Nuclear Power Corporation. Paragraph 12 of the MOU will no doubt be analyzed at least a hundred times before this litigation is resolved. Part of it states the parties, “expressly and irrevocably agree[s]: (a) that the Board has jurisdiction under current law to grant or deny approval of operation of the VYNPS beyond March 21, 2012 and (b) to waive any claim each may have that federal law preempts the jurisdiction of the Board to take the actions and impose the conditions agreed upon in this paragraph to renew, amend or extend the ENVY CPG and ENO CPG to allow operation of the VYNPS after March 21, 2012, or to decline to so renew, amend or extend.”

The world has changed since the 2002 agreement and Entergy believes political maneuvers by the state legislature has now voided the provision Entergy agreed to in good faith. For starters, in 2006, a law was passed prohibiting the Public Service Board from issuing a Certificate of Public Good without express approval from the General Assembly. In an open letter to Vermonters, Entergy provides further details. Given the NRC's approval, which addresses the safety issue, Vermonters stand to lose 650 jobs and $16,484,000 in state and local taxes based on a 2008 benefits statement.

Recently, two studies were released on the effects of radio frequency (RF) exposure of wireless smart meters on humans. The California Council on Science and Technology (CCST) issued a report in January concluding the RF exposure from smart meters fell far below the FCC limit. A study by Electric Power Research Institute (EPRI) released last month reported similar conclusions.

According to the EPRI study, the RF exposure from smart meters would be less than from TVs or radios and far less than from cell phones or microwaves. 

The CCST study concludes that even if a meter malfunctioned and transmitted without stopping and the person was sitting next to the meter 24 hours a day – an impossible, worst-case scenario – the exposure level would be 60% of the FCC limit, or 1.2% of the exposure level at which harmful thermal effects were observed.

Hopefully these reports will quell concerns about the safety of wireless smart meters. I suspect they will satisfy most people, but not all. Some believe the FCC limit is inadequate. Their main concern is about the potential non-thermal effects of not just wireless smart meters but any device that uses radio-waves or microwaves, such as TVs, radios, microwaves, cell phones and internet routers. The claim is that even at low levels of RF exposure, there may be harmful effects – other than from heating tissues – if exposed over a long period. Therefore, they claim the FCC limit is inadequate.

The CCST and EPRI reports acknowledge that concerns exist among some in the public regarding non-thermal, harmful effects (such as headaches, irritability, cancer, etc.) of wireless devices. However, there simply is no reliable scientific evidence to show causation and there is no consensus in the scientific community that RF exposure causes non-thermal related harms. The FCC must base its regulations on reliable scientific evidence and cannot revise its RF exposure standard based on speculative fear.

This illustrates a vicious circle where fear trumps logic. If some simply believe their fears to be correct, even in the light of contrary evidence, then science may not convince them otherwise. One can only hope that an increasing use of smart meters by others will begin to allay their concerns. In the meantime, these reports will give the public more confidence as they take a direct role in the building of a smarter electricity infrastructure.

I have no doubt that a smarter grid will eventually benefit all classes of customers. Industrial and commercial customers when properly informed will leverage smart meter data to improve their bottom line financials. However, I am not convinced that most residential customers will want to be as engaged with the real time pricing information provided by their smart meters the way they play with apps on their smart phones. Seeing the price of electricity spike on a hot summer day does not provide the same thrill as receiving a video of your grandson two states away kick the winning goal in a soccer game. Ever leave home without your cell phone? Just ten years ago, this question would not have made much sense. Now just reading it can generate mild discomfort. Fast forward to the evolution of the smart grid. Will not knowing the latest kWh prices generate that same feeling of discomfort? I don’t think so. However, not being able to charge your smart phone can and will continue to generate distress. The bottom line for all classes of customers is that they want to know electricity is there when they need it, which is pretty much 24/7. And therein lies the greatest benefit of the smart grid...greater reliability. The updated digitized smart grid will improve outage response times and in some cases prevent outages. The smart meters will provide additional data to help utilities provide better service. A side effect of this upgraded technology is that the smart meter will provide additional data. The very thing that is helpful can also be viewed a con as it raises privacy concerns. 

Utilities should consider these sensitive privacy issues when implementing their smart meter programs. The first step will be a well thought out privacy policy. The second step is making sure your call center has sufficient talking points to articulate your privacy policy. The basics of the policy should provide information on how customer specific usage data (“CEUD”) will be treated, to what extent it will be shared with third parties and how customers can prevent it. PG&E’s Customer Information Privacy Policy is a good model. 

Last year DOE had a Request for Information on this very issue and on October 5, 2010, issued a detailed report that contained the following recommendations:

• Consumer education and flexibility in both technology and pace of deployment will be critical to the long-term success of Smart Grid technologies.
• Many Smart Grid technologies can generate highly detailed, or “granular,” energy-consumption data that should be accorded privacy protections because it is both potentially useful and sensitive.
• Utilities should continue to have access to CEUD and to be able to use that data for utility-related business purposes like managing their networks, coordinating with transmission and distribution-system operators, billing for services and compiling it into anonymized and aggregated energy-usage data for purposes like reporting jurisdictional load profiles.
• Consumers should be able to access CEUD and decide whether third-parties are entitled to access CEUD for purposes other than providing electrical power.
• All classes of electric utility customers should be entitled to protect the privacy of their own individual energy-usage data.
• Deployment strategies must be flexible for utilities serving rural, low-income, minority or elderly customers and consider the special circumstances of those customers, but should not presume that Smart Grid technologies are inappropriate or unhelpful to such customers.
• States must carefully consider the conditions under which consumers can authorize third-party access to CEUD.
• To promote further cooperation and dissemination of information about practices relating to the regulation of the privacy and data-protection aspects of smart-grid technologies, a web portal should be created to act as a “clearinghouse” for such data.

Pacific Gas & Electric (“PG&E”) and the EMF Safety Network ("Network") battled over the summer regarding the safety of smart meters.  In early spring, Network submitted an Application to the California Public Utility Commission (“CPUC”) requesting the Commission modify its previous orders approving PG&E’s smart meter program alleging health related concerns. EMF Safety Network is self-described in the application as "a coalition of business and property owners, concerned citizens and PG&E ratepayers in northern California who address health, environmental, and safety impacts associated with electromagnetic fields (EMF) and radiofrequency radiation (RF) technologies.” Network’s mission is public education, policy development, and community advocacy to limit further widespread, chronic, involuntary EMF and RF exposures. Network requested the following modifications:

• re-open Commission review of PG&E's Smart Meter program
• require PG&E to submit an independently prepared RF Emissions study
• schedule evidentiary hearings on RF health, environmental, and safety impacts
• review actual Smart Meter program performance
• require PG&E to amend its tariff to afford customers the right to opt out of the smart meter program; and
• impose an immediate moratorium on PG&E installation of new Smart Meters pending completion of the requested study, evidentiary hearings and the proposed Commission review.

PG&E filed a Protest of Network’s Application as well as a Motion to Dismiss. In the motion, PG&E argued that the Commission should dismiss Network’s Application on the grounds that the field of RF emissions is pre-empted by federal law, that the Federal Communications Commission (“FCC”) is the body responsible for RF regulation, that all meters with smart meter technology have been licensed or certified by the FCC and that the Supremacy Clause of the United States Constitution precludes the CPUC from regulating RF emissions.

A flurry of protests, replies and comments ensued during the summer of Smart Grid Smackdown, including comments to the Proposed Decision (“PD”) granting PG&E’s motion to dismiss. The Division of Ratepayer Advocates (“DRA”) argued in its comments that the CPUC is responsible to ensure that smart meters do not endanger public health and “Unless the public’s concerns can be put to rest, there is a very great risk that PG&E’s Smart Meter deployment will turn out to be a $2.2 billion mistake that ratepayers can ill afford.”

On December 2, 2010, the CPUC, paved the way for PG&E’s continued deployment of smart meters by adopting the PD and granting PG&E’s motion to dismiss. Given the emotional protest involved, I have a feeling the case and the issues raised will not end with the CPUC’s decision.  

Lisa Romani contributed to this post.