Australia's smart meter snag

The Victorian experience has made governments wary of smart meter roll-outs and while they have the potential for significant benefits in the long-term, consumers are only focussed on the short-term costs.

A report released by Smart Grid Australia reveals that government and energy companies face a huge task ahead educating and persuading consumers/voters of the merits of smart meters and time-varying pricing.

This is bad news for the federal government whose energy white paper has pretty much hung much of its hope on time varying pricing as the recipe for containing peak demand and electricity costs, with little emphasis on alternative measures such as an energy efficiency credits scheme and other dedicated measures to encourage demand management.

The chart on the left below, taken from the Smart Grid Australia report, reveals that a third to almost a half of consumers haven’t even heard of smart meters, except for in Victoria which has had a mandatory roll-out over the past few years. Unfortunately while Victorians are certainly aware of smart meters, the chart on the right reveals that a large proportion of the population tends to have an unfavourable view about them. For the other states consumers tend to have a neutral view, probably because they haven’t really thought about them.

Source: Smart Grid Australia

The poor experience in Victoria it appears has served as a loud and rude wake-up call to electricity businesses and government about energy consumer behaviour and attitudes.

Reading through this report from Smart Grid Australia, what you read between the lines is that energy companies know there’s a need for greater use of demand management, but they’re struggling to deal with an apathetic and grumpy consumer. 

Consumers for the most part are a bit like a cranky old cat in terms of their relationship with their energy supply. For the most part they just lie around passively not doing much and aren’t interested in interacting with others about their power supply or energy efficiency.  But if you stir them (say by increasing power prices, changing tariff structures, or charging them for new smart meters), then they can suddenly and viciously strike out, giving you a very nasty scratch.

The problem which confronts both government and energy companies is that there is a series of changes we need to make to how we manage the energy system, which are ultimately in consumers’ long-term interests.

Roll-out of smart meters and time-of-use pricing will help to: contain peak demand growth; enable better monitoring and management of grid; more accurate billing; better feedback to consumers about their energy use; and further out into the future it will provide a better platform for integration of large levels of renewable energy. 

This is going to help consumers over the long-term but involves some costs and adjustment now. 

Consumers, because they are so disengaged, are liable to only see the short-term costs and not understand the longer term benefits. Plus the incredible bill shock many consumers have suffered in the last few years has meant they are now especially angry with, and suspicious of, energy companies.

At the same time they’re at least now paying attention to their energy usage and have an appetite for learning how they might reduce their energy bills.

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