Do you really pay that much attention to how much electricity you are using at any point in time? I suspect most Kiwis think about their electricity use once a month – when the bill arrives! These days our electricity meters are tucked away discretely somewhere outside our homes. We don’t pay all that much attention to how much electricity we’re using, or when we are using it.

In the next few years technology is likely to change all of that. Smart meters and web-based technology is likely to give us much greater information, and through it much greater control, over our electricity use. We’ll be able to monitor the impact each additional appliance has on our power bill. We’ll also be able to spread our electricity demand, allowing us to save money by using cheaper electricity in times of lower demand. The retail pricing model will have to change for this to happen because at the moment we’re charged the same unit price for our electricity regardless of when we use it. That may be simple, but it doesn’t incentivise more even usage throughout the day.

Smart meters and smart appliances will also allow us to use less or cheaper electricity without even having to think about it. Our hot water cylinder and our deep freeze will be able to switch themselves on and off depending on other demands within the household and external factors such as price. I particularly liked the Parliamentary Commissioner for the Environment Jan Wright’s recent comment that we’ll soon be able to drive our electric cars home, plug them in, drain the remaining electricity they have in order to cook our dinner and heat our homes during ‘peak’ times, and then charge them up again off-peak when power could be cheaper.

Maximising the use of this kind of technology is going to require industry standards for two-way communication between consumers and the big power companies, something the current government are reluctant to impose. They argue it’s too early to regulate because we don’t know what the dominant technology will be. On the other hand, it’s a bit of a chicken and egg situation; appliance manufacturers won’t produce smart appliances until they know what the smart grid is going to look like.

To be fair to the government, they aren’t doing nothing to promote more efficient electricity use. While I have some concerns about the way it has been rushed, I do give the current government credit for the huge increase in the number of homes that are being properly insulated. Warmer, drier homes are more able to minimise unnecessary electricity use. Similarly, if they’re used effectively on timers, heat pumps can also lower power bills, so the government subsidies in this area are also welcome.

We need to change our mindset from thinking about how we can build more power stations to thinking about how we can use our existing electricity supply more efficiently and how we can encourage more localised electricity production. More on the latter shortly…