Mention the words "smart grid" in the context of Xcel Energy, and many of us remember the debacle a few years ago of the company's SmartGridCity in Boulder — for which customers elsewhere ended up picking up a significant share of the $44.5 million tab.
But technology marches on, and the need to upgrade the antiquated way most utilities — including Xcel — manage power supplies only grows with the passage of time.
This week Xcel launched a plan called "Our Energy Future" that addresses renewable energy goals and also involves testing new technology that will "pave the way for an interactive, intelligent and efficient grid."
Don't flinch at the words "interactive" and "intelligent," fellow rate payers. This time Xcel's plans appear far less pie-in-the-sky.
Currently, the electricity meters in residential homes measure total monthly usage, and customers are then charged on that basis — except in summer, when they are charged less for the first 500 kilowatt-hours than for consumption above that threshold.
That's fine so far as it goes, but it's a clumsy and somewhat inaccurate reflection of how consumption affects the grid. If you own an electric vehicle, for example, and plug it in during the afternoon, you're helping to hike peak demand and therefore the need for additional infrastructure and supply. However, as Alice Jackson, Xcel's regional vice president for rates and regulatory affairs, told us, "If you plug in your [electric vehicle] at night, you shouldn't have to pay the on-peak cost for that resource."
Xcel would like to send "price signals" to consumers depending on their time of consumption in addition to their total usage, to better manage peak demand. And to that end, it will ask the Public Utilities Commission for permission to seek 10,000 customers to volunteer to test new meters that also register time of demand — with that number expanding quickly in future years.
This seems like a reasonable way to move into the smart-grid era, and even gives customers a modest degree of control over the price they pay for some electricity usage.
In the long run, a smarter grid and more sophisticated meters will enhance the system's efficiency, promote conservation, and even result in faster response to equipment problems. The failure in Boulder was an ill-planned setback, but not the end of the story.
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