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Thanks, Edward Snowden: Talking to Customers about Smart Meters Just Got Tougher

James Belcher's picture

Summer’s revelations about the National Security Agency’s domestic surveillance have given the tinfoil hat crowd a boost. In a post-Edward Snowden world, it’s harder to label privacy obsessives as simply paranoid: the government actually is listening--or at least collecting data. We learned that a lot of the technology that protects our online activity, like the widely-used SSL encryption protocol, may not be completely secure. It’s enough to give even techno-optimists like me the heebie-jeebies.

Unfortunately, the general unease about privacy and security plays into existing skepticism about smart meters. Utilities already had their hands full talking to resistant (and sometimes armed) customers about advanced metering. Much of the skepticism has been easy to counter; smart meter radio-frequency levels are measurably no more harmful than any of the many other electronic devices we use daily. They don’t automatically result in higher bills. When properly installed, they do not catch fire or explode. 

However, there’s a legitimate argument to be made that anything connected to the Internet is, to an extent, insecure. Some automated meter infrastructure (AMI) information is delivered to consumers online, and thermostats with motion detectors know when you’re not at home, so electronic eavesdroppers could too—in theory. Fear about such a possibility plays into the hands of those ideologically opposed to government intrusion; the Tea Party has been especially vocal in its efforts against smart meters, but so has the Green Party, as well as conservatives and liberals of various stripes. Once again, we find the path to a brighter energy future involves politics.  

Fighting customers who don’t want smart meters isn’t great PR, and allowing opt-outs is the right thing to do. The question is how to make that the exception rather than the rule. 

The good news is that human behavior hasn’t changed, at least in the U.S. People will generally do something if they think the personal benefits outweigh the risks. For instance, there’s no evidence that people are abandoning their smartphones, despite the reports that telephone calls are subject to widespread surveillance and that most people’s smart phone settings provide GPS location information down to less than eight meters. Many users also set their phones so that service providers like Google and Yelp basically know where they are when their phone is on—or users announce their locations themselves with Facebook and FourSquare check-ins. Internet traffic is still growing. People are not abandoning their powered, connected ways. 

Smart meters still offer consumers more control over their energy usage, can help them lower their bills, and hold the promise of fewer outages and faster service restoration. Utilities and smart meter providers now have to redouble their efforts to combat misinformation, maintain consumer trust, and clearly demonstrate and articulate smart meter benefits. 

There’s no shortage of resources available to aid in this effort. The Smart Grid Consumer Collaborative (SGCC) has smart grid consumer engagement success stories available on its site. The SGCC also has consumer engagement help specifically for municipally owned utilities and co-ops. San Diego Gas & Electric documented its smart meter rollout communication, with a focus on one goal: transparency with customers. The overall plan involved three stages over 90 days including face-to-face meetings with community leaders, speaking at community events about the benefits of smart meters, and specific and targeted letters sent to their entire residential consumer base. The engagement plan was based on lessons outlined in the U.S. Department of Energy's Smart Meter Deployment Handbook, which aims to distill and further best practices. 

But for those concerned about security and privacy issues, additional measures and efforts are warranted. Some utilities have formed security governance boards to ensure that their systems and the information entrusted to them are secure. As Andy Bochman recently described them on Smart Grid News, the boards are representative groups of executives and functional leads who talk about cybersecurity from an enterprise-wide perspective. Members tend to include the CIO, the heads of cybersecurity and physical security, leadership from different functional areas and one or two more senior executives. It's all part of building accountability into the system. Such security measures may not stop the NSA, but keeping private information secure matters. This can be publicized, to an extent; consumers want to know their data is handled in a serious way.

That type of behind-the-scenes activity is important in maintaining consumer trust. Some of the biggest concerns tend to be around who has access to the data and how will it be used. This is why California has put a law in place to limit sharing data with third-parties. While sharing data may be an attractive income source for some utilities, they will likely need to provide transparency to customers on how this is shared via notices, and potentially provide them a method to opt-out of the sharing. The FTC has been fairly aggressive with consent decrees with companies that implement poor security measures, considering them to be deceptive acts and unfair practices.

One especially consumer-friendly move has been the creation of the Green Button program, which gives consumers direct access and control of their data.  

Some of the privacy concerns at issue have yet to play out. The Fourth Amendment implications of smart grid readers are still to be tested and won't be known for some time. 

In the end, the only thing to do is keep hammering away on the facts. The Wall Street Journal reports that Wisconsin is facing a bill (AB345) that would prohibit utilities and co-ops from installing smart meters on the premises of customers who don’t want them, including consumers who had already had them installed. But Bill Skewes, executive director of the Wisconsin Utilities Association, said advanced meters have been installed and working for customers of most larger investor-owned utilities in the state for several years.

“With current (smart) metering technology, we can get accurate monthly meter readings, reduce estimated bills and restore utility service more quickly and efficiently after major storms,” he said in talking about the benefits of smart meters. “We can provide better service at lower costs...” Moreover, Mr. Skewes points out that doing the right thing with customer information is already codified and protected: “We are prohibited by current law from sharing any private customer information of any kind,” he said.

Now deployers just need customers to trust them, and they need to implement killer apps that make people see smart devices and networks’ real value—not just for the utilities, but for consumers.


James Belcher, senior analyst, covers a range of clean technology areas for Clean Edge. James analyzes clean-tech markets, helps maintains the firm's stock index products (CELS and QGRD), and contributes to Clean Edge reports and consulting projects. James' past experience includes work with eMarketer, Inc., Webtrends, and Find/SVP, Inc. (now ORC International) covering technology and digital marketing.