Smart Meters

I recently was invited to participate in a new pilot program offered by my electricity provider, Virginia Dominion Power. It’s a part of a national trend to help consumers control their electricity and, at the same time, help utilities cut their operating costs.

Virginia Dominion Power, following the lead of utilities in California, Texas and other states, is rolling out the program to install “smart” electric meters in homes in the belief that they will help cut electricity consumption and reduce the need for new power plants. The smart meters will allow consumers to see, at a glance, how much electricity they are consuming at what cost.

The Critical Peak Pricing Pilot Program is based on two joined approaches increasingly used in the private sector. I predict that these two approaches will soon become standard “best practices” for most monitoring, analysis and management of all kinds of performance, including that of courts.

(1) Bring everyone – customers and employees alike – not just top management, into the discovery and execution of solutions to problems (in this case, prohibitive construction costs for new power plants to provide electricity during temporary spikes in demand).

(2) Use the latest technology to deliver the tools (in this case, critical power usage information displayed by smart meters in real time) to enable anyone who is motivated to do so be part of the solution, and then reward them for their efforts.

The Critical Peak Pricing Program upgrades participants’ electric meter outside of their houses, and the traditional thermostat inside. It replaces them with a single state-of-the-art smart meter inside the house. In addition to the traditional thermostat readings of the current temperature and setting, the smart meter send readings wirelessly and displays current energy use in real time, the cost of that usage, the current pricing levels set by Virginia Dominion Power for various times of the day and year (critical peak, intermediate and non-peak). The meter also notifies consumers of periods of critical demand that strain the area’s power supply.

As a participant in the pilot, you agree to pay a higher rate for power consumed in critical peak periods, which Dominion Virginia Power says are limited to 125 hours per year and will occur in five hour increments during the day. In return, you are charged a lower rate for the power you use during non-peak times. Participants are notified in advance of any critical peaks and alerted by a set of colored lights by the smart meter so they can adjust electricity consumption.

By monitoring, analyzing and managing our energy consumption, my family saves money and helps manage my area’s energy requirements. Virginia Dominion Power is inviting my family to help solve our shared problem and giving us the tools to do it. In theory at least, everyone wins.

Systematically controlling unwanted variation (e.g., spikes in power demand) is not new. (See Undesirable Variation in Court Performance, Made2Measure, April 23, 2007). Using the latest technology of smart meters and performance dashboards that provide very detailed information about performance to anyone in real time is. It’s an innovation that is likely to spread.

As I’ve said before, courts are at the tipping point in the development of performance dashboards and business intelligence as a major factor in the management of organizations including courts. (See The Real Promise of Performance Dashboards, Made2Measure, May 9, 2007; and The Exciting (and Confusing) Court Performance Dashboard Market, Made2Measure, November 14, 2007).

What seems pretty clear -- like the old monthly electricity meter readings which will be relics of the past in ten years or less -- monthly (or even less frequent) written reports on a court’s performance that only top management gets to review and analyze, and perhaps later pass it’s solution to the masses, just don’t cut it anymore.

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