California Utility Customers Can “Opt-Out” of Smart Meters

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In a decision that could have major implications for smart grid efforts around the country, the California Public Utilities Commission (CPUC) yesterday ruled 4-0 that utility customers could opt-out of smart meter installations.

The decision comes after a year of contentious debate between Northern California utility Pacific Gas & Electric (PG&E) and customers who were concerned about safety risks and privacy concerns.

Opting out, for a fee

The CPUC’s ruling provides customers with the option of paying a premium to keep their older analog meter. Those choosing to opt-out will have to pay a one-time $75 fee and a $10 monthly fee for as long as they keep their analog meter. Low-income customers can pay a reduced $10 upfront fee and $5 monthly charge.

The new charges would make up for the cost of re-installing analog meters on homes that want to switch back and the cost of having meter readers visit homes every billing cycle.

PG&E had advocated for the CPUC to allow customers to switch radio transmitters off inside installed smart meters, but that option was still controversial to customers who were concerned about electromagnetic radiation. The CPUC had found that even though PG&E’s smart meters emitted radiation frequency when the radio was turned off or removed, it was still below allowable FCC standards.

PG&E has plans in place to install around 9.7 million smart meters for residential and business customers by the end of 2012. The company says around 90,000 residential customers had signed up for its “delayed installation” list to avoid having a smart meter installed before the CPUC ruling was finalized. PG&E had estimated that almost 150,000 customers would opt-out if given the chance.

The biggest, but not the first

While the CPUC’s ruling will have the biggest impact on smart meter plans to date, it is not the first state to allow customers to opt-out of utility installation plans. Maine’s Public Utilities Commission (CPUC) established an opt-out program for the 612,000 customers in Central Maine Power’s territory in May 2011.

Customers have two options – they can either keep an analog meter for a $40 one-time fee and $12 ongoing monthly charge, or have a modified smart meter installed with the radio turned off for a $20 initial charge and $10.50 recurring fee.

Ultimate opt-out effect?

Ultimately, consumers who opt out may incur even greater financial losses. California has aggressive smart grid plans, including time-of-use pricing and demand response programs, both of which empower customers to make smart energy consumption decisions based on more accurate power costs and offer financial incentives to reduce electricity use during peak demand. But, both programs require two-way communication between utility and customer, and neither can truly work with an analog meter.

A 2010 CPUC survey found much of the controversy surrounding PG&E’s smart meter initiative stems from the company’s lack of customer service when installing the meters and dealing with subsequent concerns.

Images courtesy of PG&E and Bay Area News Group

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