Smart meters need smart policy

Lee Greenberg writes in the 2010.04.17 National Post (a Canadian conservative daily paper):

“A $2-billion program aimed at shifting home-energy use to off-peak hours is about to fail, says the province's chief environmental watchdog. Gord Miller, Environmental Commissioner of Ontario, says millions of so-called smart meters will be useless unless the government changes course and sets a sufficiently low hydro rate to convince people to do their laundry and dishes at night and on weekends.”

Miller’s concern centers on the fact that the difference in on-peak and off-peak is only a factor of 1.9. Coupled with the fact that the weekday off-peak is between 9pm and 7am, there would appear to be too little motivation for a household to hold laundry and vacuuming until late in the day (or early next).

A 2007 study in Ottawa found households saving $1.44 a month through time-of-use pricing that differed by a factor of three! A $1.44 buys a small coffee at Tim Horton’s.

So is Ontario installing $580 million in smart meters so that each household can get save the equivalent of a free small coffee? Once a month? Can't be.

The social and economic performance of smart metering is a critical matter. We are fast approaching a time of smart metering for road use. A smart meter would meter time-distance-and-place of driving (anonymity guaranteed by performing and keeping all calculations inside the car) to calculate a replacement for fuel taxes – hardly a choice, given the move to the all-electric vehicle.

While road-use-metering, when it arrives, will be principally motivated by the loss of the fuel tax, it is also intended to manage demand for road space – exactly as the electric meter is intended to manage demand for power.

Couldn’t be simpler.

Cars increasing, fuel tax decreasing. Now what?

Or could it? If Ontario cannot figure out how to set the clock or price differentials for electricity metering, how can it figure out the time and place differentials for mileage-based road use fees?

If I can only save $1.44 per month by shifting my time of travel, I won’t. If I save $1.44 a day (to say nothing of a month) by taking the bus instead of my car, I will not. I had better be saving $5 per day, if you want my behavior to shift.

The policy that sets the rate differences between peak and off-peak travel, or between a pre-Gore SUV and a post-Gore EV, or between urban streets and highways and rural roads is called a pricemap.

Since the Province of Ontario has not until recently permitted its Ministry of Transportation to even discuss road use charging, it is easy it understand that there has been no discussion of starting the work needed to design this pricemap.  Even the more forward-thinking Dutch flopped around this pricemap design business for some time.

Worse, if we cannot set the pricemap correctly for our critical power supply, how will we do that for our even more critical road supply?

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In other news: Germany is having the same tolling discussion Toronto is and Ontario should be!