CPUC eliminates “smart meter” opt-out fees

By George Miller

When “smart meters” were rolled out by utilities across the nation as part of the “smart grid” technology, there was much opposition. The “Smart Grid” was sold based on being able to monitor power usage much more closely, to identify trends, usage patterns, eventually implement time phased billing to encourage flattening of power demand and even control power input to the grid.

These so-called “smart meters” utilized to accomplish this can transmit usage electronically very frequently, allowing utilites to eliminate meter reading and get more real time usage info for planning and control purposes. However, there is a small, but very informed and energetic opposition to this all. Some groups mounted powerful legal opposition and were able to avoid installation of smart meters upon request. In most cases, a a significant initial and monthly fee was charged for this.

Specifically, objections fall into several categories:

– Not cost-effective

– Harmful RF (Radio Frequency) emissions

– Fire hazards

– Loss of privacy

– Loss of control (power companies would eventually be able to limit or even shut off power to a facility, or even a specific device, or class of devices, once “Energy Star” standards were adopted by device manufacturers and grid equipment.

We won’t comment on the validity of pro and con arguments in this article.

“legacy” meter on opt-out plan. Photo: CitizensJournal.us

The CPUC (California Public Utilities Commission) has been forced to drop the opt-out fees for customers (yes, utilities were charging customers NOT to receive this service, on the grounds that the manual meter readings are more expensive) on the paid opt-out plan for at least three years. The rationale for this appears to be more financial than anything, after battling over cost analyses for years. The ruling not only eliminates fees, but goes to bi-monthly meter readings to reduce data collection costs. 

This was actually decided last year, but just now being announced to customers and implemented.

Excerpts of the decision:

“In view of the utility overstatement of opt-out service revenue requirements in their initial proposals, we adopt a balancing account
(i.e., “recorded cost”) approach to setting the revenue requirement for opt-out service until each utility’s next general rate case (GRC).  In their initial fee proposals for opt-out service, utilities significantly overestimated the number of opt-out customers.  Since opt-out service costs are primarily based on the number of opt-out customers, the result was that utilities greatly overestimated the costs for opt-out service.  Using a balancing account treatment will protect ratepayers against a similar overestimation of uptake and revenue requirements…..

We limit the collection of the monthly charge from residential opt-out customers to three years from the date they choose to opt-out.  The remaining portion of revenue requirements that exceed the revenues collected from the
opt-out charges are to be allocated to the residential customer class as a whole.”

 

Utilities affected and amounts:

Here’s the actual CPUC decision- #14-12-078: