Impacts of diffusion policy: determinants of early smart meter diffusion in the US electric power industry

Abstract

Diffusion policies aid the adoption of technologies by targeting various channels of influence in an innovation system, including costs, learning, and standards. Little empirical research exists on their impacts, however, largely because of a lack of data. Using a panel dataset and econometric models, I analyze the determinants of the early diffusion of smart electricity meters in the US electric power industry, where public policy and regulation have supported the adoption of smart meters by electric utilities. The empirical findings suggest multiple drivers of smart meter diffusion. Policy and regulatory support have had a significant, positive impact on adoption, but the findings also suggest that utility characteristics and some combination of learning, cost reductions, and technology standards have been important determinants affecting smart meter diffusion. The timing, sequence, and context of diffusion policies are important to consider.