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Critics Say LG&E's Proposed Smart Meters Are Intrusive And Unnecessary

Pratt, Liz

Louisville Gas & Electric is once again seeking permission from the Kentucky Public Service Commission to install smart meters on customers’ homes.

The outcome could affect the privacy, bank account and electricity use of every LG&E and Kentucky Utilities customer, and ratepayers will have a chance to weigh in at a meeting in Louisville on Monday evening.

Advanced Metering Systems, also known as smart meters, use radio transmitters to relay data in real-time back to utilities, like Wi-Fi for your energy meter. They also provide granular information about energy usage.

LG&E plans to use this extra information to offer different rate structures and new programs that it says will save customers money.

The meters also allow LG&E to pinpoint and resolve power outages faster, and would reduce costs for meter reading, said spokeswoman Natasha Collins.

“By having energy usage information in their hands, by having access to how they're using energy in their homes, this equipment allows customers to make educated decisions about changes they want to make,” Collins said.

Privacy, Equity And Timing Concerns

But privacy advocates say reading people’s energy use in real time is intrusive. Smart meters would allow utilities to know details like what time you shower and for how long.

Collins said LG&E only releases customer-specific information with a subpoena, court order or customer consent.

Fair housing advocates question whether utilities should have the ability to turn off a customers’ power with a click of a mouse.

Cathy Hinko with the Metropolitan Housing Coalition says the costs of paying for smart meters won’t be equitably distributed, particularly among renters and low- and fixed-income homeowners who won't reap the benefits.

"Renters have the least control over their built environment and one of the supposed benefits of the advanced metering is that you can see the energy you're using and change your ways or improve your home," she said. "And that is not really given to people who are low-income."

Then there’s the question of timing.

Tom Fitzgerald with The Kentucky Resources Council said customers have already paid for the meters on their homes — and those meters still have some shelf life.

“Right now, you have a generation of meters that are out here that still have useful life,” he said. “You’re proposing to replace them with a new generation of meters that are potentially much more intrusive on privacy.”

The current generation of meters last as long as 36 years, while new smart meters will last 20 years or less — meaning ratepayers will be on the hook for replacements sooner.

Additional Costs

LG&E first proposed deploying smart meters in a 2016 rate case. That case was settled, but the issue of smart meters was taken off the table. At the time, LG&E representatives said the company would further study the issue.

In January, LG&E asked again. This proposal is largely the same, but also includes the ability for customers to opt-out of the smart meter program. To do that, customers will have to pay a one-time fee in addition to monthly fees of $72.71 for KU customers and $57.86 for LG&E customers.

Notably, LG&E is not asking for the Public Service Commission for a rate increase. Instead, they’re planning to finance more than 1.3 million new electric and gas meters with a mix of debt and equity, according to LG&E’s PSC application.

LG&E estimates the 2018-2022 roll-out will cost approximately $350 million, according to John Malloy, vice president of gas distribution for LG&E.

For the average residential electric customer, that would amount to $2.60 per month, he said in testimony before the Public Service Commission. Any rate increases will have to be separately approved by the PSC.

LG&E says adding smart meters on customers’ homes would net $483 million in benefits, the majority of which will come from savings on operations and maintenance.

But the Attorney’s General Office disagrees with those estimates saying LG&E has overstated the benefits of smart meters and understated the costs.

“I believe these benefit projections to be inflated by hundreds of millions of dollars,” said Paul Alvarez, a utility consultant who testified on behalf of the Attorney General's Office before the Public Service Commission.

Alvarez says the $2.60 bill impact does not include a nearly $200 million increase in the present value of capital costs. As a result, in his written testimony he said the Public Service Commission should disregard the estimate entirely.

The Kentucky Public Service Commission will be taking public comment on this case Monday, July 9,  at 5:30 p.m. at the EDT Founders Union Building, Room 6 University of Louisville ShelbyHurst Campus 450 North Whittington Parkway Louisville, KY 40222.


Ryan Van Velzer is the Kentucky Public Radio Managing Editor. Email Ryan at rvanvelzer@lpm.org.

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