Smart meter recall cost balloons to $47 M, SaskPower says

A revised estimate of the cost of reversing a SaskPower smart meter program is now pegged at $47 million, according to the provincial Crown corporation. The power utility has been ordered to swap out 105,000 units already installed.

The revised estimate includes costs associated with the initial installation of the units and the cost of stock on hand for units that were going to be installed. The estimate also accounts for the labour of removing installed smart meters and the cost of purchasing a non-smart meter product. SaskPower did not save old ones as it was rolling out the program.

The recall of smart meters was ordered Wednesday by the provincial government after a number of unexplained fires associated with the installation of the devices were noted. There were eight incidents as of Monday. Most of the fires involved the new meter although SaskPower noted Thursday that one of the fires took place at a connection point from the meter to the power service.

The smart meter program began in October, 2013.

While it remained uncertain about who would bear the costs associated with the recall, Saskatchewan Premier Brad Wall said Thursday he does not want to see SaskPower customers bearing the burden.

"We'll direct SaskPower to find alternate means, rather than the rate-payers, to compensate for this," Wall said. "And the vendor, by the way, who bears some responsibility in my view, for these particular meters."

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SaskPower OK with recall

On Thursday, officials from SaskPower said they were on board with the government's decision to remove the meters and have them replaced.

"We totally support that decision," Mike Marsh, SaskPower's vice president of operations, said Thursday. He added the company was anticipating a recall. "It's certainly an option we've been planning for as an eventuality and we support it."

According to officials, it will take about six to nine months to swap out the meters already installed.

"Right now we are trying to look at a solution to the issue that we have and find a suitable meter that is going to work for us in a safe and effective way," Marsh added. "We will deal with the contractual issues over the course of time."

Marsh said the provincial Crown corporation is reviewing its contracts and hoped to negotiate an arrangement with Sensus, the supplier of the smart meters.

He said the meter SaskPower will install, in place of the Sensus smart meter, is one that SaskPower is familiar with and has not had any issues related to fire.

Marsh noted it is not unusual for a power meter to break down, the concern with the smart meters relates to the fires.

"The ones we're putting back in we've had experience on for over 10 years now," he said. "We do have failures with them, but we haven't experienced the type of overheating condition, which is what we're concerned about."

The government also ordered an internal review to examine how SaskPower came to install the Sensus meters.

"This is what we want to get to the bottom of," Wall said. "It's not acceptable. This is a Crown corporation owned by the people of the province. They're the shareholders. And so they deserve these answers. They also need to be assured of public safety."

Wall pledged the results of the review would be made public.

Marsh said SaskPower did consider the style of smart meter that Saskatoon Light and Power is using, that has not had any problems. He said that type of meter did not have the functionality SaskPower needed for all its customers. The Saskatoon meters transmit usage data, but the range of the transmission is not far enough, Marsh said, for SaskPower.

"Saskatoon is a concentrated urban centre," Marsh said. "They can deploy a different type of network there."

Saskatoon's city owned utility provides service to about 60,000 customers. SaskPower services the rest.

Meter readers continue

SaskPower's switch back to a non-smart meter means the company will continue to rely on meter readers checking power usage from time to time. Meter readings were supposed to be phased out when the complete smart meter system was deployed, which was planned to be done by 2015.

When the program was halted about 400,000 meters had yet to be switched to smart meters.

In addition to buying meters from Sensus, a U.S.-based multinational company that services the utility industry, SaskPower also hired a company called Grid One, a firm that provided project management and logistical support for installations of the smart meters.