Toward a sustainable modern electricity grid: The effects of smart metering and program investments on demand-side management performance in the US electricity sector 2009-2012

Abstract

Building a sustainable modern electricity sector is a key part of the United Nations’ 2030 Sustainable Development Goals. Smart meters are expected to contribute to the achievement of this goal by providing new demand-side management opportunities for utilities. Attempting to address existing gaps in the extant literature, this paper examines the effects of metering technologies and demand-side management program investments using panel data from 87 American electricity utilities for the period 2009–2012. Our model provides strong explanatory power with respect to energy efficiency, and shows that automated meter reading (AMR) devices, advanced metering infrastructure (AMI) devices, direct program costs, and incentive costs all have a positive influence on energy efficiency effects. In contrast, the results for load management are largely insignificant, with the exception of incentive costs that has a small, but significant, negative impact on peak load reductions. We discuss the implications and potential research directions arising from these findings, in particular, the need to consider interactions between different demand-side programs and the influence of different types of information technologies that are emerging as part of the smart grid.