Why Nova Scotia Power will get more from its smart meters than customers

Nova Scotia Power's plan to install smart meters in the homes and businesses of its 500,000 customers will give the company a data gold mine to help its operations, but the immediate benefits to consumers aren't as evident.

The meters will allow the company to automatically measure how much electricity people consume and will eliminate the need for meter readers to manually take the measurement.

"Essentially, the smart meter is making life easier for Nova Scotia Power to collect data," said Larry Hughes, a Dalhousie University professor with research interests in energy security and energy systems.

Besides better data, the company will instantly know if a customer loses power.

Installation by 2020

Pending regulatory approval, the company said the installation of the meters will start on a pilot basis in late 2018, with full rollout beginning in 2019. All of the meters should be installed by the end of 2020.

While the meters will give consumers better insight into how much electricity they consume and when it's being used, in the short term, it doesn't provide much of a carrot for people to reduce their electricity consumption.

"No matter how many kilowatt hours you consume and no matter when you consume them, you will still be charged 15 cents a kilowatt hour," said Hughes.

What is time-of-day pricing?

This is because for the most part Nova Scotia Power does not have a time-of-day (TOD) rate pricing system. TOD charges different prices for electricity depending on what time of the day it is. During peak consumption periods, higher rates are charged to entice people not to consume electricity at these times.

At present, the only customers that can get TOD "must have an electric-based space heating system that has the capacity to store heat with appropriate timing and controls in place and approved by Nova Scotia Power," says the company's website.

With the smart meters, customers will be able to better understand how they are consuming their electricity as they'll be able to access usage information by the day or the hour on their phone, tablet or computer.

While they may be able to see when their usage spikes, there is no financial incentive to change their habits.

"It will only really be when the [time-of-day] pricing comes in that you can take advantage of it," said Hughes.

Nova Scotia Power says time-of-day pricing is on its radar

Because Nova Scotia Power is in the first year of a three-year period where rates are set, making rate adjustments isn't an option right now.

Future rate changes would have to be approved by the Utility and Review Board, and the company does say TOD is something it's looking to introduce in the future.

"Some other jurisdictions have made time of day rates mandatory, but that would not be our direction," said spokesperson Tiffany Chase in an email.

"For Nova Scotia Power, it would be a matter of providing customers with more choice for rate options."

No cost to consumers

Nova Scotia Power said the smart meters will not cost customers any money. The company estimates it will spend about $250 per customer to install the meters, which cost $115 per unit. NSP has not yet selected its supplier.

The company expects to save $38 million over the next 20 years, primarily because it will no longer have to manually read customers' meters.

Nova Scotia Power says about 70 per cent of Canadian homes currently have smart meters. Their usage in other jurisdictions has had some complications.

Smart meter problems in other jurisdictions

In 2014, smart meter billing irregularities prompted Hydro-Québec to launch an investigation.

In the same year, Saskatchewan's power utility, SaskPower, was ordered to remove 105,000 smart meters following concerns about eight unexplained fires associated with the units.

Chase is confident the rollout will be smooth.

"We're using newer generation meters than earlier deployments, so it's much better technology. The manufacturers have worked the bugs out, and modern smart meters are subject to more rigorous testing for safety, security and accuracy than the early meters," she said.

"We've also had the opportunity to learn from the experience of others who have already implemented smart meters, helping us make sure this is a great experience for our customers."