Hydro Ottawa is starting to install smart meters in homes this week.

The provincial Liberal government has asked utilities to put smart meters — which tell residents how much power they are using over a short period of time such as an hour — in all Ontario homes by Dec. 31, 2010.

The meters are meant to facilitate time-of-use pricing, in which electricity prices are higher during times of peak usage — such as midday during the summer, when most air conditioners are running.

That provides an incentive for customers to perform power-hungry tasks such as running the dishwasher at off-peak times such as the evening, making more efficient use of available power.

Time-of-use pricing is expected to be in place by the time all Ontario homes have smart meters.

Several pilot tests of the meters have been running in Ontario. Hydro Ottawa is wrapping up a pilot test of the meters that began last September with 200 residents in Alta Vista, Lindenlea and Cardinal Glen.

Even without time-of-use pricing, the initial pilot project produced changes in electricity usage, said Owen Mahaffy, the program manager for metering systems at Hydro Ottawa.

"The people who really saved or affected change had altruistic reasons for doing so," he added. 

Hydro Ottawa started a second pilot project in August called Smart Price to see how time-of-use pricing will affect electricity use. About 300 Ottawa residents are participating.

Mahaffy anticipates that type of pricing will lead to a "huge change in behaviour."

Arnold Midgley, a participant in the initial Ottawa pilot project, said he thinks making smart meters available province-wide will have several benefits.

"I think it would help other people to recognize how they use their power and what they can do about it," he said, "and how they can both save themselves money and save the province."

In November 2005, the provincial government announced it would spend $1 billion to install the new meters, billing electricity users an extra $1 to $4 per month to help cover the cost.