47_Vic Richey

CEO, ESCO Technologies

Pricing Power

Utility pricing is pretty opaque: You run the dishwasher and blast the AC, and at month's end a bill arrives. But what if you knew how much electricity you were consuming in real time—and how much it cost? You might just do things differently.

That's the idea behind Advanced Metering Infrastructure (AMI) from ESCO Technologies. The combination of hardware and communications software lets utilities price power hour by hour, based on demand—and allows consumers to see the current cost and adjust their use accordingly.

In November, ESCO landed a roughly $300 million contract with Pacific Gas & Electric to bring AMI to 5 million California homes and businesses. And the federal Energy Policy Act of 2005 encourages all states to evaluate real-time electrical metering, which suggests that a wider movement could be afoot.

PG&E hopes to save $1 billion over 20 years by tracking consumption and restoring outages automatically. But the technology is also consumer-friendly, spurring people to manage usage much as they do cell-phone minutes. "What we're trying to do is alter consumers' behavior," says ESCO CEO Vic Richey. If they succeed, both homeowners and utilities could save money, and the planet might be a bit better off.

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