Ratepayer Groups Seek Halt to ‘Smart’ Gas Meters

By Published On: December 2, 2011

Ratepayer advocates want the California Public Utilities Commission to rescind its permission for SoCal Gas to install “smart” gas meters at a cost up to $1 billion to its customers. Proponents argue that consumer pocketbooks are too constrained amid the ongoing recession to pay for the wireless meters. They point to evidence in the Pacific Gas & Electric gas explosion last year in San Bruno that major safety investments in the state’s aging gas pipeline system are needed instead. “We may be looking at a very big price tag [for pipeline safety upgrades] much of which could be paid for by ratepayers,” Division of Ratepayer Advocates interim chief counsel Karen Paull said. The request echoes mounting concern over the cost of providing utility service evidenced in a commission debate last month about the cost of a large solar energy procurement contract. When the project was initially planned, the economic outlook was expected to improve more quickly (Current, Nov. 11, 2011). Paull explained that mounting cost concern served as the catalyst for the division and The Utility Reform Network to ask the commission to modify its decision on the automated gas meters more than 1.5 years after it was approved. Rate increases for electricity, natural gas, and water are making it difficult for consumers to bear the cost of the “smart” meters, said Paull. She questioned meters’ ability to deliver energy conservation benefits. SoCal Gas opposes any reconsideration by the commission, said utility spokesperson Raul Gordillo. He said the company has lined up contracts for meter vendors that will meet “the spirit” of the commission’s decision, which targets both cost and energy savings. Under the decision, SoCal Gas plans to begin installing meters late in 2012, said Gordillo. By 2017, it intends to have replaced all 6 million of the meters in its system. While the commission considers the petition for reconsideration of the gas meter decision, The Utility Reform Network and DRA also want regulators to place an immediate stay on installation of the meters. Paull said she expects a relatively quick decision on the stay, though the commission is under no specific time deadlines to deal with either of the requests. The two organizations told the CPUC in their petition filed last month that going ahead with the meters will heap costs on ratepayers. The company, they wrote, also is proposing $2.5 billion in safety improvements in the wake of the Pacific Gas & Electric San Bruno pipeline explosion last year, as well as a $1.6 billion rate hike. “Safety, not smart meters, is the priority for consumers,” stated acting division director Joe Como. He added that the meters provide little benefit to ratepayers. TURN executive director Mark Toney noted that the utility has yet to effectuate any contracts to purchase or install the meters, which means the CPUC “can halt the program now with no harm to vendors, consumers or the gas company.” When the CPUC approved the automated gas meters in 2010 by a 3-2 vote, an analysis showed the devices would provide little net benefit to ratepayers. Unlike digital electric meters that are supposed to help cut peak demand when power is expensive to buy, gas prices do not change that much from day to day, much less from hour to hour like electricity. Consequently, the consumer advocates maintain the automated meters are unlikely to offer any help in cutting gas usage or overall gas system costs. Paull, for instance, called the potential for saving energy with the meters “speculative.” The only significant savings is that the company no longer will need meter readers, so it will save on labor. A decision on whether to halt going forward with meters could come within a couple months. Meanwhile, approval of contracts to install the meters also is pending with the commission.

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