US energy giant faces law suit over smart meter costs

A disgruntled California resident has put up a potential speed bump in the race to install smart meters throughout America's electrical grid, after launching legal action against his supplier over its smart grid rollout.

Pete Flores has filed a class action suit against US energy giant Pacific Gas and Electric (PG&E), alleging fraud, false advertising, unfair competition, and negligence.

The suit, originally filed against PG&E and smart meter installer Wellington Energy, could spread if the plaintiff's attorneys Kirtland & Packard LLP execute on a proposal to extend the action further up the supply chain. As a result, smart meter manufacturers could yet become embroiled in the legal action.

Flores bought the class-action suit because he felt that PG&E's smart meter program was inflating his utility bill. He claims that his electricity bill trebled from $200 to $600 a month after he had a smart meter installed, despite the fact smart meters are widely promoted as a means of helping to curb energy bills.

The California Public Utilities Commission is preparing an independent group to assess the accuracy of smart meter products. However, the lawsuit, if successful, could represent a major PR blow for nationwide smart meter rollout plans that have already been criticised in some quarters for resulting in potential increases in energy rates.

PG&E is preparing to contest the legal action and argued in a statement that "allegations in the lawsuit are untrue and have no merit".

The company has also opened up a customer service centre in its Bakersfield office to advise customers on smart meter issues, and a public hearing was held in October where citizens voiced their concerns.

PG&E, which uses smart meters from companies including Landis+Gyr and Silver Spring Networks, began installing smart meters in 2006. The utility expects to deploy nearly 10 million meters by the end of 2011.

The meters give customers access to the company's SmartRate service, a voluntary summer programme that can save households money if they reduce their energy usage during peak periods.