San Diego Gas & Electric: a smart utility interview with Anne Shen Smith


Please start by giving a status update on SDG&E’s smart meter rollout?
SDG&E completed a successful rollout of our initial smart meter test phase to 5,000 customers in August 2008. On March 16, 2009 we began installing smart meters to the balance of our 1.4 million customers which includes 1.4 million electric meters and 900,000 natural gas meters. All customers throughout the entire SDG&E territory, from the Mexico border to Orange County, will have a new smart meter by the end of 2011. We have currently installed 180,000 electric and gas meters and will have more than 200,000 installed by the end of 2009.

Smart meters will provide customers with the ability to have more control over their daily energy usage by allowing them to monitor energy consumption and lower their energy bills. They will also allow faster power outage restoration by pinpointing power outages, and allow customers access to their energy use information 24 hours a day.

Most importantly, smart meters will pave the way for all residential and business customers to change their energy use patterns to take advantage of bill credits for the energy they save. As customers shift their energy usage, more electricity becomes available, delaying the need for additional energy supply sources on peak days.

In the future, smart meters – and the two-way communications they include – will allow homeowners and businesses to leverage HAN functionality. We are currently in the piloting phases. With the HAN, customers will be able to control their air conditioning, appliances, home theatre and lighting remotely, and programme via the internet and the HAN to power up or off automatically. By using the internet and enabling technology, they will be able to access information stored in the smart meters and have greater control over their appliances from either the home or workplace.

SDG&E has performed extensive customer outreach on our smart meter programme. Prior to smart meters coming into an area, we speak to community leaders about smart meters and talk one-on-one with our customers by participating in local community events where we can speak to customers about the benefits of smart meters. When a community is ready to receive smart meters we contact customers directly via mail prior to receiving their smart meter and keep our website, where all schedule locations can be found, updated with the latest information.

What are some of the lessons that SDG&E can offer other utilities in their smart meter/smart grid rollouts?
Utilities should take a measured approach, taking into account the benefits that are possible to achieve from such a system. These benefits should drive the end-to-end system, technical and customer requirements.

Both internal and external support is required for the project to succeed. Utilities installing smart meters should be sure to include stakeholders and customers in the equation, all the way from the design of the meter installation process to what products and services they value the most from a smart meter.

A smart meter system is a system of systems, which touches all utilities’ legacy IT systems, all well as many existing and new business processes. Utilities must be prepared for the organisational and business changes that a smart meter programme will deliver and fully understand the system low level requirements and interdependencies before entering the design process.

Can you comment on customer experiences with the Google energy management tool?
We think customers that are able to access information on their energy usage can reduce it by at least 5 to 10%. This means that by saving energy our customers will also be saving money on their energy bill.

In a survey of more than 750 SDG&E customers, 87% said it would be beneficial to them to receive their energy usage information online daily; 67% said they would like to access their energy usage at’s “My Account” page; and 29% said they would like access to their energy usage information on their own homepage, through a third party provider.

SDG&E has created an online customer network that will be located at and bring smart meter technology to life for our customers. It provides smart meter customers with a list of ways to receive their energy usage information online. Google is SDG&E’s first partner and in the future we think we will have many such partners.

In December, SDG&E will offer Google PowerMeter to customers with smart meters. Specifically, the Google PowerMeter gadget will show a customer’s electricity usage on their personalised iGoogle homepage, alongside other personalised gadgets, such as email, stock quotes, weather and breaking news. The Google PowerMeter will also provide conservation tips, as well as links to SDG&E’s Website where energy efficiency information is available.

Please give an overview of SDG&E’s smart grid plans. What impact has the ARRA funding on these projects and what benefits are anticipated?
SDG&E has been continuing to lay the groundwork for a smarter grid over the past few years with planning for everything from distribution automation and workforce development to new technologies like our smart meter, condition-based maintenance, and microgrid projects.

We recently submitted two Recovery Act stimulus applications to accelerate our smart grid vision. One is for a regional end-toend smart grid demonstration project that we expect to hear about in the next few weeks (requested $100 million), and the second is one we recently received for a smart grid investment grant of $28.1 million for our “Advanced Smart Grid Communications System” that will act as the wireless communications backbone to the smart grid project and replace aging, legacy infrastructure.

In August, SDG&E brought together over 25 of some of the most forward-thinking companies, universities and agencies to help create a secure end-to-end smart grid demonstration application that will accelerate the development of the smart grid in the San Diego region and beyond.

The goal of our coalition for this San Diego County regional demonstration is to build on the smart grid foundation SDG&E has created – smart meters, our new outage and distribution management system, and self-healing and microgrid technology – and accelerate the delivery of these benefits to our customers, so they can use the smart grid in a way that saves them money, allows for increased use of renewable resources located at both distribution and transmission service levels, allows for increased numbers of electric vehicles, and gives them choices in how they prefer to use energy.

This landmark initiative will provide the very first look at how the smart grid will function – at all levels – from generation to transmission to distribution and to the customer. This demonstration, and what we learn from it, will allow us to significantly compress the timetable for the large scale deployment of smart grid technologies – meaning quicker benefits for our customers, the environment, and the country.

Our coalition of partners are critical for this effort and the only way we are going to bring the vision of the smart grid to reality is through cooperation across all of the players and industries involved in the effort.

What are the main challenges that SDG&E faces in its ongoing smart meter/smart grid rollout?
As mentioned above, a smart meter programme impacts many IT systems and well as business process within a utility. This needs to be well planned out and accounted for. Also smart metering, as it is defined today, is a nascent technology, so be prepared to learn as you proceed.

With regard to smart grid, although the technology is nascent, SDG&E must move forward with urgency in some areas: electric vehicle integration, a commitment to 33% renewable energy that comes with intermittency issues, and a significant growth in residential rooftop solar.

Please outline SDG&E’s policy and activities on electric vehicles.
On November 19 we unveiled to our employees the first Nissan LEAF zero emission, all electric vehicle in San Diego, representing a major step as we launch the largest transportation electrification project in US history and continue our journey to drive change for a cleaner, greener future.

A total of $200 million of federal stimulus funds will be expended to develop a mature charge infrastructure that will include more than 2,200 public charge stations in the San Diego region. An additional $8 million grant from the California Energy Commission will provide additional infrastructure. SDG&E is working with Nissan, eTec, local government and the community to assess and identify key residential, retail and public charging locations with plans to begin installations in the summer of 2010 with completion expected in the second quarter of 2011.

Developing the charging infrastructure is the critical link in the smart grid to making electric vehicles commercially viable. And, integrating electric vehicles and the charging infrastructure is a key component of SDG&E’s smart grid initiative.

SDG&E’s role in transforming the region will be to evaluate the impact of electric vehicles on the electric grid, help design rates to encourage electric vehicle usage, engineer a path for the new generation of electric vehicles to plug into the developing smart grid and help educate our customers about the new world of clean vehicles and energy technology.

Please give an overview of SDG&E’s net metering activities and what the company is doing to encourage home generation.
Net energy metering (NEM) in California allows customers to bank excess electricity onto the electric grid to offset their cost of the electricity during times when their PV system is not generating, such as in the late evening. SDG&E credits PV customers for generation returned to the grid at the same prices as they are billed. This gives the PV customer a full retail value for their generation within their 12 month true up period. SDG&E’s smart meter system will support net metering. SDG&E currently has 60 MW of renewable capacity under its NEM programme or approximately 1.3% of its peak demand; the current amount of NEM allowed under the state-wide cap is 2.5% of peak load.

Some other ways SDG&E encourages and supports home and business-owned generation is through its energy efficiency programme, financial incentives, rate options and support to customers during interconnection. For example, SDG&E recommends customers should first make all cost effective energy efficiency improvements to their homes and businesses prior to investing in generation. To help customers take this very important first step, SDG&E offers a large number of energy efficiency incentive and rebate programmes.

The California Solar Initiative provides financial incentives to customers who install PV. This $2.1 billion, 10-year programme is funded by California’s utility customers including SDG&E’s. In SDG&E’s territory, the programme is administered by the California Center for Sustainable Energy.

SDG&E also offers its solar customers alternative rates that often can improve the payback of their investment in renewable generation. For its residential customers, SDG&E offers a time-variant rate where the price of electricity is higher during the summer on-peak period (when the PV system is operating) and lower at other times. This type of rate can increase the credit achieves under NEM for any excess electricity during the on-peak period which then can be used to offset the cost at other times. This also gives PV customers that generate excess generation during peak time a maximum benefit. For our commercial customers, SDG&E offers a discounted solar rate that lowers the fixed or demand charges which often cannot be avoided by customers who use energy after their PV systems stop generating. SDG&E also offers its customers an alternative feed-in tariff that allows customers with renewable generation to sell all or just their excess energy to the utility at predetermined price for a period of up to 20 years.