GE recently released some preliminary findings from its Smart Meter/Appliances pilot program, which debuted in November 2008. So far, participating LG&E customers like the capabilities of the demand-response appliances and have modified their behavior to reduce energy consumption and save money without much disruption to their lives and schedules, according to Mike Beyerle, director of marketing innovations for GE. Although the participants appreciate their appliances’ automatic demand-response features, they also reported that they like maintaining some control over their appliance use. Program override functions give them the flexibility to run their appliances even during peak periods if necessary. The feature helps circumvent any sense among participants that the electrical utility dictates when their appliances may be used.
“Consumers are concerned about the “Big Brother” aspect of demand-response, but our view is that the utility will let you know when pricing is going to change and when they’d like you to do something different. We think the consumer needs to be both responsible for their energy usage and in control of their energy usage,” Beyerle says. “Flexibility needs to be built into the system.” GE plans to release a full report on its findings soon and also will expand the pilot program to other areas of the United States.
Early in May 2009, Whirlpool announced it’s getting into the game as well, with a commitment to make all the electronically controlled appliances it produces worldwide—Whirlpool, KitchenAid, Jenn-Air, and Maytag brands—capable of receiving and responding to Smart Grid signals by 2015. “This is a critical step forward in creating a demand-response environment in which energy reduction is systematically controlled across thousands of homes at a time, providing automatic energy reduction without any inconvenience to consumers,” Marcy says.
According to Whirlpool’s global director of innovation, Warwick Stirling, the company also is developing regional Smart Grid demonstration projects in partnership with utility companies that will yield insights into the needs of both consumers and electric utilities. Whirlpool and Maytag branded appliances will likely be the focus of the first demonstration projects, Stirling says. The company has been testing energy management and grid-friendly technologies in consumers’ homes since early 2003 in the Midwest, Pacific Northwest, and along the West Coast.
Developing the Smart Grid and systems that will interact with it will require a massive market transformation involving manufacturers, utilities, regulators, and government bodies. “Stimulating consumer buy-in for the Smart Grid requires a collaborative effort among industry, government, and nongovernment institutions to form policies that reward consumers for operating their appliances on the Smart Grid system,” Marcy notes.
Time-of-use pricing could become more common around the country as energy demand continues to rise and utility regulators seek solutions to offset the costs of peak generation, but other incentives will likely also be necessary. “We’d like to see other encouragement to adopt Smart Grid technology, like those offered for using Energy Star products. Rebates from utilities and the federal government [along with other initiatives would] encourage consumers to buy energy-intelligent, as well as energy-efficient, appliances,” Beyerle says.
With all the incentives that already exist for homeowners to reduce their energy usage and the Smart Grid initiatives in place at multiple levels, a shift toward some form of energy intelligence in appliances is probable. “Five years, 10 years from now, 30 percent to 50 percent of the appliances sold are likely to be more intelligent, demand-response-enabled, and more efficient by design,” Beyerle predicts.
Such a future may be more likely and more cost-effective if existing appliances already in homes are retrofitted, rather than replaced with new demand-response appliances. Hamilton thinks the industry that grows up around the Smart Grid will develop a converter box for existing appliances that will allow them to interface with utilities. At the moment, however, no such device exists, so it will be up to appliance manufacturers like GE and Whirlpool to test the waters.