Guide to Smart Meters and Opt-Out Fees

Most of the major electric companies and one gas company in Maryland either have installed new Advanced Meter Infrastructure ("AMI") meters, otherwise known as smart meters, or they are in the process of installation. These system changes will affect about 2 million electric customers in Maryland. In response to concerns of some customers over smart meters, the Maryland Public Service Commission decided to allow customers to opt-out of taking the new smart meters by paying a fee to the utility company.

If you live in Maryland, you probably live in an electric service territory where you already have an Advanced Meter Infrastructure (AMI) meter, commonly called a smart meter. These companies are regulated by the Maryland Public Service Commission (“Commission or “PSC”). The following companies have installed smart meters:

BGE

PEPCO

Delmarva Power (DPL)

SMECO

The major difference between the traditional meter and the AMI meter is that the new meters can send and receive information. Like a cell phone, these devices digitally transmit information over wireless networks; the networks are operated by the companies. These transmissions are a form of radio spectrum signal, thus are governed by Federal Communications Commission regulations. These transmissions are a form of electromagnetic radiation called non-ionizing radiation.

In 2010 the PSC first allowed certain electric companies to replace existing meters with smart meters in their service territories. If you are a residential customer of Pepco, DPL, BGE, or SMECO, you either have an AMI meter, or your utility will be attempting to install one soon. Your utility should give you notice of this installation ahead of time. Some customers have expressed health and privacy concerns about these meters. The PSC allows customers to “opt-out,” but they will be charged a fee.

If you have a smart meter in Maryland, or expect to have one in the future, you are affected by the Public Service Commission’s orders about opt-outs.

Probably. The companies are required to notify you shortly before they install the meter. If you are unsure, contact your utility.

If you are a customer in one of the service territories that has installed smart meters, and your meter is outside your home, the utility has probably installed the smart meter unless you opted out. If the meter is inside your home, or otherwise inaccessible, you will need to give the utility access to be able to install the new meter.

If you opt out, the fees you will be charged depend on which service territory you live in. The PSC has set the following fees the companies can charge to customers who opt out of receiving an AMI meter:

Utility Up-Front Charge Ongoing, Monthly Charge
BGE $75.00 $5.50
PEPCO $75.00 $14.00
DPL $75.00 $17.00
SMECO $75.00 $17.00

The $75.00 up- front fee will be charged over three-monthly billing cycles. The monthly fees will be charged indefinitely and are subject to change depending on later decisions by the Commission.

As of January 1, 2016, the monthly charge will be $5.50, a reduction from the earlier fee of $11.00 per month.

No. Even if you opted out or deferred, the companies cannot charge an additional fee to install the smart meter.

The utilities have been required to itemize the fee on the customer bills. You will see the fees on you utility bill.

The fees took effect July 1, 2014. Customers who opt out after that date should see the fee appear on the next bill after they opt out, or after the neighborhood meters have been installed. Some customers may be required to pay the fee if the utility determines they were not responsive to attempts to reach the customer.

Yes, there is a grace period. If you change your mind, you must tell the utility. For BGE customers, the fees will be waived if you notify BGE that you want the AMI meter before the end of the 5th billing cycle after the bill date with the first opt-out fee and allow reasonable access for installation. For other utilities, the time is more limited – you must notify the utility before the end of the subsequent billing cycle.

No. Over the past two years, a large number of customers – especially those with indoor meters – had not responded to the utility, particularly in the BGE territory. The PSC decided in November 2014 that if the company has tried to install a meter, but for some reason hasn’t been able to, and the customer has not decided to opt out, those customers can be charged the opt-out fees under certain conditions. For all of the companies installing smart meters, the PSC has directed those customers who don’t yet have a smart meter, but who have not acted to opt- out, to either schedule an appointment to install the meter, or to opt-out for the fee. Any time a customer denies access to company equipment, like a meter, or does not pay approved rates or fees, the utility ultimately may be able to disconnect service.

No. The PSC allowed the utilities to collect opt-out fees only for costs related to opting out— these are the additional costs that result from allowing customers to opt out.

Several bills were filed with the General Assembly in past years regarding smart meters and opt out fees. However, those bills did not pass. The PSC orders are the guiding authority on these fees. OPC believes that because there are definite additional costs to allowing opt outs, and because the costs are directly attributable to one set of customers—those who choose to opt out—having a fee-based charge is the fairest way for the utilities to collect for these costs. If fees were not allowed, then the utilities would have to collect the costs from all customers.

As part of their plans to install AMI metering systems, the electric companies have planned on reducing other costs, such as meter reading staff, and phasing out billing systems that only worked for the old meters. Because customers are now allowed to keep their old meters by opting out, the utilities must have dual systems, and incur costs to do things the utilities had planned to phase out or do less of. Maryland law allows utilities to be paid reasonable rates for service they provide to the public. The Commission decided that, because these additional costs are resulting only from certain customers’ desire to opt out, those customers should pay the additional costs. Otherwise, all customers would have to pay the additional costs.

This is a common question and breaks into two issues: how does the meter work, and will the overall bill go up.

One part of your bill reflects your energy usage. The AMI meters, like the older analog (turning wheel) or newer non-networked digital meters are all designed to do the same thing: measure the flow of electricity. The AMI meters must meet the same standards as the older meters. If your current meter is working properly, and then you get an AMI meter, and it also is working properly, you should not notice any difference in your bill. If you do notice a difference, it could be for a number of reasons, such as weather or change in household members.

OPC recommends that you monitor your bills any time you have a change in your meter-reading equipment. If you do not believe your bill is accurate, you should first contact your utility. You may ask for a meter test. If you still disagree, you may contact the PSC and ask for a referee test, for a small refundable fee. You may also file a complaint with the PSC’s Office of External Relations if you remain dissatisfied.

There are two questions: Security of your data and your right as a customer to control access to that data.

Security: There is no doubt that smart meters will collect and provide much more information about your energy usage to the utility than ever before. Depending on your utility, this data may be transferred in one packet, or several packets throughout the day. The data will show usage throughout the day, but it will not show how it is being used. The meter will not be able to say whether that electric usage is linked to your computer or your refrigerator. However, as the AMI meters are networked devices, this makes them more vulnerable in a number of ways that the older meters were not. Security of the utility systems, including customer data, is a major concern for the PSC, utilities and OPC.

Customer Data Privacy: Customers have expressed concern about their privacy and controlling who has access to their usage information. Utilities cannot release customer data to third parties without your permission, unless required by a warrant or subpoena. AMI meters do not change that utility obligation. OPC supports strong customer privacy rules and will continue to monitor and remain engaged with the utilities and the PSC over privacy and cybersecurity concerns related to AMI meters.

There were some news reports several years ago about fires associated with some smart meter installations in other areas of the country. OPC is not aware of any fires associated with smart meter installations in Maryland, and the utility companies have assured the PSC that the meters being installed in Maryland are safe.

The utilities have provided testimony before the Public Service Commission that the AMI meters emit what is known as “non-ionizing” radiation that is like that of a cell phone or other mobile device, and this is supported by federal government agencies that OPC has contacted. When the Commission considered the health effects of smart meters, it decided that although they emit non-ionizing radiation, scientists have studied that form of radiation extensively for several decades and found no evidence of harmful effects on human beings.

While OPC agrees with this assessment, we understand that individual customers may consider the non-ionizing radiation to be hazardous to their health, and do not want the AMI meter installed. That is a personal decision.

You may choose to retain your old meter, or have a non- AMI meter installed, but you will be required to pay the additional fees.

The meter, and everything leading from the electric distribution line or gas pipe up to the meter is the utility company’s property. So, by law, the utility company has a reasonable right of access to its equipment, including the meter, even if that equipment is on private property. Under law, a utility company has the right after a reasonable attempt to gain access to its meter to disconnect service to the meter. These rights are spelled out in the document known as the Tariff, which is posted on a utility’s website, and is available from the PSC.

If you have an older meter that needs to be read by hand, this means the meter reader must be able to come onto your property. Some meters can be read from a few hundred feet away by a radio transmitter. Under the PSC’s decision to allow opt-outs, a customer who has concerns about their property with respect to smart meters may choose to retain the older meter (or have a non-AMI meter installed), but must pay the fee, regardless of the reason for opting out. Keep in mind that if your older meter stops working, or needs replacement, the utility has a right to gain access to the meter to repair or replace it; otherwise, it may have the right to disconnect your service.

In most cases, you should not have to do anything because the utility companies need very little in terms of permission to install the meter if it is on the outside of your house and accessible to the company. Once you have the AMI meter, you don’t have to worry about the fee.

If you have an indoor meter—this is primarily in BGE’s service territory—or it is otherwise inaccessible, you will need to contact your utility to schedule an appointment to have your AMI meter installed. If you don’t allow your utility to install the meter, the company has the right to charge you the fee. If you have an outdoor meter, you probably don’t need to do anything because the utility will be able to install your meter without your authorization.

You should receive a notice from your utility before and after the installation. Even if you expect to get an AMI meter, you should monitor your bills to ensure you aren’t getting charged for opting out. If you see a charge, you should contact your utility immediately.

The primary ways to reduce your bill with a smart meter are by participating in various utility- run and third-party programs that offer you different incentives for reducing your electric usage at specific times and dates. Of course, any time you reduce your electric usage, whether it’s through a special program, or just using less air- conditioning, for instance, you can reduce your electric costs.

As a result of some of the energy pricing programs utilities participate in, there is an effect of reducing overall system electricity demand, which helps avoid system-wide reliability problems. Putting a value on that effect is difficult and subject to debate.

AMI meters should make some utility operations easier. For instance, the utility can disconnect or reconnect your utility service quickly if you want (although consumer protection rules are still in place) and could help restore power more quickly after outages. You also will be able to get access to more detailed information about your energy usage.

You may opt out in one of three ways:

Call your utility

Write your utility

Go to the utility website (online option not available for all utilities). You will be subject to the fee schedule for your utility.

It depends. In most cases, you should be able to retain the existing meter. However, the PSC has authorized the utilities to install non-communicating digital meters, as well as digital meters that transmit data a short distance by radio signal. These meters, known as ERT or AMR meters, do not communicate on a two-way fashion like the AMI meters, but instead only send a one-way signal to a receiver so a meter reader can take the reading from a short distance away. So, if you still have an analog meter, but it breaks, you may get a different style of meter.

OPC does not have a position on whether any individual customer should opt out. Only a small percentage of customers have made this choice. However, this is a personal decision. Since opting out will have a definite bill impact, each customer needs to weigh those costs against the risks they perceive from the AMI meter.

If you have a dispute or complaint about meter installation, fees, billing, or service quality, you should contact your utility first. If the problem is not resolved, you can file a complaint with the Public Service Commission.

To file a complaint, you have four options

File a complaint online.

Download a PSC/CAD complaint form and mail it with any supporting documents.

Maryland Public Service Commission 6 St. Paul Street, 15th Floor Baltimore, MD 21202

If you do not have a computer or access to one, call PSC/CAD at 410- 767-028 or 1-800-492-0474 and ask them to mail you a complaint form. Inform the PSC/CAD representative if you have a shut-off notice or are off-service and ask them to take a complaint by phone. A form will be mailed to you to fill out and return.

You can fax a written complaint with any supporting documents to 410-333-6844.