Transients can cause premature failure in electronic equipment, improper
power factors can result in surcharges from utility companies and high harmo-
nics can shorten the life of transformers. Once the smart meter locates these
issues they can be dealt with accordingly.
Meters are most commonly used for billing; however, the data provided by
a conventional meter is usually not very detailed, often consisting of nothing
more than a monthly total of energy usage. Many utilities are moving toward
time-of-use rates, that is, they charge more for energy use during times of peak
demand. They will also often provide an incentive for utility customers to shift
demand to off-peak periods. Because conventional meters only provide aggre-
gate readings, time-of-use rates require smart meters. EPAct 2005, Section
1252 requires that utilities in a state that mandates time-of-use rates must
provide smart meters to their customers.
Real-time pricing, also known as dynamic pricing, makes even better use of
smart meters. Time-of-use rates are predetermined by the utility and provided
to customers, allowing the customer to adjust or shift their load accordingly.
Real-time rates change by the hour, based on the utility’s actual cost of gener-
ating and/or purchasing electricity at that particular time. Being able to adjust
Figure 5.3 Electric meter.
Electric Power Management Systems 65