The adventures of an analog engineer and digital storyteller who studies emerging networks and their impact on the great game of business.

A few months ago, Southern California Edison installed a new smart meter onto my house. Those who read this blog regularly know that I love data, so I admit that my heart raced a little when I learned that my new meter could not only take up to four readings per hour, but that I could also access this information online.

It took a few months for the data-logging to begin, but I’m now in data-heaven. Here’s what one day of data looks like.

Figure 1: 24 readings daily

At first glance, this chart may not seem overly special. But, I contend that it represents a large step toward a very different world.

Consider the fact that before my smart meter, the power company could only measure my annual power consumption in twelve, monthly chunks. The new smart meter subdivided those chunks into 8,760 hourly readings, thus increasing the resolution of my power consumption picture by a factor of 730.

With the cost of sensors, processing power, wireless communications and cloud storage plummeting, we’re on the cusp of being able to measure things with unprecedented granularity.  Just as telescopes and microscopes opened access to worlds that were once invisible to the naked eye, devices like smart meters are too opening up new worlds. The finer we chop the data, the higher the resolution. The higher the resolution, the more visibility that we have.

For example, Figure 1 illustrates that my house burns 0.45 Kilowatt-hours (KWh) for each hour between 12:00 and 4:00 a.m.–a time when the Ploof household was sleeping. The only devices running at that time were a refrigerator, 60-watt porch light, clock radios, cable modem, wireless router, and other items that are in “sleep mode” (computers, DVR, etc…)

So, how much does it cost to run my house at its lowest electrical consumption level? At $0.17 per KWh, it costs 7.75 cents for every hour. Think that number is small? Try multiplying it by the 8,760 hours in a year. It costs me $657 per year just to run the house at its lowest level without anything else running!

Let’s play with this number a little more. According to the US Energy Information Administration, the average California household consumes 562KWh/month (6,744 KWh/yr.) Since my household consumed 8,168 KWh last year, let’s say that my usage is 21% higher than the average residence in my little town. Assuming that the average baseline power consumption of its 18,000 residents is 21% lower than mine, at a minimum, they consume:

  • 6,399 KWh/hour
  • 153,576 KWh per day
  • 56,055,240 KWh/year

which costs the residents $9.529 million annually. Start multiplying that number by the residents of the state or the residents of the country, and we’re talking huge numbers. By increasing the resolution of our data, we get to see the big picture in a totally different way.

And we still haven’t even come close to hitting the highest resolutions as power readings can be subdivided even more to offer insight into how much power is being consumed by individual appliances or fixtures. Such granularity will allow us to actually measure phantom load, the estimated (we don’t yet have the granularity to measure it) amount of electrical energy that is consumed by an appliance while plugged in yet switched off. In other words, most phantom load is just wasted energy.

According to Wikipedia, phantom load is estimated to be 10% of our power consumption. Using the baseline electrical consumptions calculated earlier, phantom load (with everything off) for my little town is estimated at 5.6 million KWh/year at an annual cost of $950,000.

$950,000 paid for wasted energy. Think about what the city could do with this amount of money.

Today’s technology allows us to cost-effectively measure the total power consumption of our homes on an hourly basis. It’s only a matter of time for when new technologies enable us to cost-effectively do the same thing for everything that we plug in, thus increasing the granularity to actually measure phantom load. With the ability to measure it, we’ll be able to do something about it–like automatically disconnecting appliances from the grid when they are not needed.

Throughout history, resolution enhancing devices like telescopes, microscopes and now smart meters have lead to new discoveries that shake our fundamental assumptions and ultimately lead to innovation. They allow us to measure things as opposed to estimating them. Since most businesses are built on measurements, this increased resolution offers fertile ground for the development of new products, services and ultimately businesses.

Are you ready for this new granular age?


Great article Ron. Maybe the default setting for home outlets should be off, and have to be explicitly turned on. Obviously that would not apply to smoke alarms or security alarms. Perhaps for your next post you could unplug everything in your house accept the refrigerator and alarms and see what the meter says. That would be real cool to see.

May 15, 2012

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