From: innovations.harvard.edu
Published February 24, 2009 09:59 AM

Smart money's on new energy technology; Stimulus funds to recharge electric infrastructure

The state is vetting hundreds of conservation and renewable-energy projects as it readies for President Obama's stimulus money - including a long-term plan to modernize its aging electric grid.

"The future of the grid is a priority,'' said state Secretary of Energy and Environmental Affairs Ira Bowles about the need to upgrade electric infrastructure to boost alternative-energy production.

But Massachusetts may not be ready for several years to fully implement one key stimulus initiative. The $787 billion package has $37.5 billion aimed at energy investments, including $11 billion for electric-grid updates and so-called ``smart'' meters.

Obama has called for the installation of 40 million smart meters in American homes. Advocates say that could be a key to long-term conservation and efficiency.

Smart meters, which enable two-way radio communication between the utility and monitors in the home, offer consumers real-time info on their energy usage.

The goal is behavior modification: promoting energy-conscious behavior by matching usage with pricing options. Cell phone users, for example, can already track costs per call in real time.

Smart meters ``are the kind of technology that does lend itself to major federal intervention,'' said Bowles. He said the systems need to be researched before utilities, consumers and regulators can go forward in Massachusetts.

Nstar is launching a pilot program in 2010, providing smart meters to 2,750 volunteer customers at no cost to them. The pilot program was mandated by the Legislature in 2008 as part of the Green Communities Act.

``The program will give Nstara chance to see what kind of reaction we get from residential customers when we ask them to conserve on some of the hottest days of the year when the overall electricity grid is pushed to extremes,'' said Nstar spokeswoman Caroline Allen. The grid is the interconnected network for delivering electricity from suppliers to consumers.

Like Bowles, Allen believes the major financial push from Washington for smart meter installation could be a tipping point.

``Anything that defrays the costs would be beneficial in getting new technologies in place,'' Allen said. ``Consistent with other policies like renewable energy and energy efficiency, investments in the grid and emerging smart grid programs will only help move things along.''

Massachusetts' list of potential energy projects will contain plenty of ``low-hanging fruit,'' such as weatherization and public building conservation, that can be started quickly and help create jobs in the conservation and renewable energy sectors, Bowles said.

The immediate focus ``is on energy efficiency and more renewable energy,'' he said. But as the state makes long-term plans for transforming the grid and installing smart meters, it will look to models in other states. For example, in Texas, electricity distributor Oncor has embarked on a $690 million project to install 3 million smart meters within four years.

Oncor households will pay for the program at $2.22 a month over the next 11 years. If used properly, the system will generate conservation savings from 6 percent to 15 percent annually by allowing consumers access to near real-time information about usage via a monitor in the home or the Internet, Oncor spokesman Jim Greer said.

``Advanced metering systems are fundamental for our future and critical for the state as an economic engine,'' Greer said. The company estimates conservation savings could negate the need for two or three CO2-emitting power plants to meet expected increases in demand.

Some 3 million more smart meters are expected to be installed by other Texas utility companies by 2015. A Bay State smart meter expert, who develops the software code for the devices being used across the country, said the future has at last arrived.

``Electric meters have been undergoing a transformation over the past few decades, but this transformation has now increased in size and scope,'' said Skip Ashton of Boston-based Ember, which develops radio chips, networking software and application code used in smart meters. ``Installation has been slow because utilities do not rush into new technologies.''

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