An Update: PUC Smart Meter Report Raises More Questions than Answers

For the better part of this year I have reported on numerous meetings and hearings on the accuracy of Pacific Gas & Electric’s Statewide rollout of “Smartmeters” and, for some, the resulting bills that, in my opinion, simply defied logic.  

Just a week ago I received my own notice from PG&E that I had long dreaded; I would be getting my “own” meter upgraded to a “Smartmeter” within a few weeks (I reside in the Sierra Foothills near Grass Valley, CA). Immediately I recalled my reporting and what a nightmare the “Smartmeters” had caused for many. I wondered what the status of the use and billing problems were. Had they been resolved?

Surely they have!

Well, …….

Senator to call Structure Group to Legislative Hearing

SACRAMENTO – Senator Dean Florez today attended the California Public Utilities Commission (PUC) meeting in San Francisco where the Structure Group released it’s much anticipated study of Pacific Gas and Electric’s (PG&E) smart meter program.  The study was commissioned by the PUC following numerous complaints of inaccurate billing following smart meter installation.

“I believe this report raises more questions than answers.  I was especially surprised at the limited number of customer complaints that were reviewed.  I’m also concerned that there were no industry standard established prior to smart meters being placed on residents’ homes,” said Florez



“I think it is key that we take the time now to have an extensive and detailed hearing on Structure’s work product.  So far what is missing from the report is any sense that this was a true ‘investigation’ as opposed to a review of PG&E’s smart meters.”

“I plan to convene a hearing soon and possibly assemble a panel of experts to ensure that what is being reported by Structure meets the standard of inquiry expected by ratepayers.  But bottom line, I’m not satisfied with what I have learned so far about what has been presented by the PUC and Structure at this point,” stated Florez

Hopefully, I will not need to call my own elected official after I get my next “envelope” from PG&E. I will be watching the mailbox for each new bill for the next few months. You might want to consider doing the same.

2 thoughts on “An Update: PUC Smart Meter Report Raises More Questions than Answers”

  1. As a former California Public Utilities Commissioner (1999-2004), I would like to offer a few thoughts about smart meters.

    “Smart” meters are devices that can remotely report electricity and gas usage readings as often as hourly to utilities without the need for human meter readers.  The justifications offered by proponents are twofold.  First, it is claimed that utilities can control electricity usage by sharply raising rates during hours of high system demand, thus discouraging consumption and reducing the need for additional generation capacity.  Second, customers can supposedly benefit by moving their usage to hours when demand and prices are low.

    While most residential customers are skeptical, this analysis has tremendous appeal to energy producers and market-oriented economists and regulators, the same folks who brought us the electrical deregulation catastrophe in 2000-2001.  What is almost never part of the public discussion is the real motivation of smart meter proponents.  

    Utilities make their money in two ways: they are reimbursed through rates for their reasonably-incurred costs of providing service, such as paying their workers; and they are fully repaid plus  a “reasonable” rate of return for long-term capital investments in their systems (“rate base”).  Only the second adds to corporate profit, the bottom line.  Replacing functioning existing meters, which have already been partially or fully amortized and have a low rate base, with expensive new ones provides a guaranteed stream of profits for decades to come.  

    For example, Southern California Gas Company’s new meters, recently approved by the PUC, add over $1 billion to rate base and will bring shareholders hundreds of millions of dollars in profits over the next 26 years, even if they don’t work as advertised or become technologically obsolete during that time.  As 1000 union jobs are eliminated in Southern California, customers will lose the safety-related services provided by human meter readers, even though there is no net cost savings from the new technology.

    Most residential and small business consumers cannot afford the expensive systems that would enable them to automatically control their consumption in response to hourly price changes.  The winners here will be large industrial and commercial consumers and perhaps some very wealthy homeowners.  Even if non-time-of-use rates are maintained as an option for small consumers, they will go up as large consumers escape regulation that apportions utility system costs among classes of consumers.  In fact, this outcome has always been a central goal of deregulation.

    Despite opposition from consumer advocates, Schwarzenegger’s PUC has enthusiastically rubber-stamped every smart meter project that has come before it.  Whoever is elected Governor in November will be able immediately to appoint a majority of this powerful commission.  Progressives need to make sure that the issue becomes part of the election debate.

    [Full disclosure: I represent Utility Workers Union of America, Local 132 in its opposition to smart gas meters at the PUC; and I am President of the Board of The Utility Reform Network (TURN), which is leading the campaign to disclose the failings of PG&E’s smart meters.  I am also the Democratic candidate in California’s 65th Assembly District.]

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