Smart Meters: Between Economic Benefits And Privacy Concerns
Next generation utility meters better known as “smart meters”, used to measure remotely and in real time gas, water, and – above all – electricity consumption, are now being deployed by several companies in many States across the U.S. While growth has leveled, after legislative incentives drove an initial boom between 2009 and 2012, installations are expected to make steady progress over the next 10 years.
The claimed reason behind the deployment, is to offer a whole range of benefits to consumers, providing them with feedback on their energy consumption, helping them to change their habits in order to reduce it and save therefore money, and reducing the risk of power outages and other issues, while at the same time providing significant savings and income for the companies involved.
Still, not everyone is convinced, and smart meters are facing opposition by groups of activists or private citizens concerned about the use of their data. As it often happens when technology is involved, the trade off is between privacy and efficiency, and has to do with the main feature of these sophisticated devices: their two-way communication capability, meaning that the company that operates them can not only receive information from the meters, but also send commands, and get a response back.
Perhaps the clearest example of this, is the remote connect‑disconnect switch. In the read-only era, if somebody got shut off for not paying the bills, and then wanted to be turned back on, the company had to send a technician, which was expensive, and it could take up to a couple of days to have the service up and running again. Now it can be done almost instantaneously. The real time monitoring and the possibility to adjust and seamlessly modify the energy supply of a certain customer, is also what allows utilities and energy companies to apply different rates according to the time of the day, or the day of the week, in which the energy is used.
The smart meters market is scheduled to grow significantly in the near future: in the next ten years or so, – Navigant Research forecasts – the overall economic opportunity coming from smart metering will amount to nearly $57 billion worldwide. The country-level installed base of electric smart meters is expected to be led by China, with more than 435 million electric devices installed by December 31, 2020, followed by the United States with about 132 million by the same date.
Despite the promise of empowering people through enhanced consumption data and provide savings, however, some people are scared and resist the idea of smart metering, citing concerns about meter accuracy, data security, and health. Privacy is probably the most sensitive issue: similarly to what happens with phone calls metadata, information about the energy consumption of a family or of an individual, can reveal a lot of details about the life of the persons monitored.
From when and for how long they stay at home, to the kind of devices used (expensive gadgets, medical equipment and so on), to the movements inside the house – from the dining room (where the TV has just been turned on) to the kitchen. Sounds paranoid? Kind of, but in a post-Snowden world many people seem to believe, for right or wrong, that “paranoia is a virtue“. Canadian director Josh del Sol even shot a documentary called a documentary called “Take back your power“, investigating, he says, “the erosion of rights in the name of ‘smart’ and ‘green’”.
Some episodes seem to give legs to the concerns. In California, privacy rules adopted in 2011 by the Public Utilities Commission require each utility to issue an annual transparency report describing the number of legal demands received for usage information and the number of customers whose records were actually disclosed. In April 2013 the first reports were issued: the most striking fact to emerge, was that the San Diego Gas & Electric company had disclosed, pursuant to legal process, the records of 4,062 customers. It’s not clear, from the report, who asked for and received those records, and why.
Aside from governmental monitoring, energy data harvesting, or hacking by third parties could also be possible. But, whereas companies cannot disobey a legal order, there’s a lot they can do to protect their customers from other prying eyes. “We had a lot of effort in cybersecurity up front to design it as secure as you possibly can – Katzman says – First off, a key thing is that we encrypt all the data that comes off the meters. Right after the meter gets installed, we encrypt its communications. All of the data that is sent from the meters wirelessly through the network is sent securely.”
Still, some people might not be comfortable using smart meters, for one reason or another. That’s why some States require utilities to give consumers the chance to opt-out of smart meter deployments, usually in exchange for a fee. In Texas, for instance, it could cost you more than $200 to stick with an old analog meter. Others do not give the chance at all. “In the State of Pennsylvania – Katzman says – the legislature actually passed a law in 2009, requiring all electric distribution companies that had over 100,000 customers to deploy smart meters by 2025″. Companies are basically forced, therefore, to replace the old read-only devices with the new ones. So, what about those residents who would prefer to stick to their old, read-only, device?
“Out of 1.2 million or so, – the manager says – we have a couple thousand. We’re holding off towards the end, which is coming up the end of this year, when we’re scheduled to be completed, to see if there is an opt‑out policy in Pennsylvania that does get adopted. If there is, we’d obviously abide by that. If there’s isn’t, customers will have to use the smart meters, if they want to keep getting power”.