Westar Energy is looking to the federal government to help finance a $40 million “smart grid” that would serve power customers in Lawrence and its immediate surroundings.

The project, dubbed SmartStar Lawrence, would replace all 43,000 electric meters at houses, offices, businesses and commercial locations in the city and portions of rural areas in Douglas County. Nearly $27 million of the financing would go for upgrading computer and software in Topeka, which would be able to accommodate systemwide upgrades in the future.

Westar officials say the new equipment and associated online resources would be expected to help Lawrence residential customers shave as much as 5 percent to 15 percent off their monthly electric bills. Results for commercial customers could vary even more, depending on their usage.

By monitoring their daily usage online, customers could learn how much money they might save by employing a variable thermostat, for example. Or by switching to compact fluorescent light bulbs. Or even by running a clothes dryer in the morning, instead of the heat of the afternoon.

In future years, Westar might choose to use the system to introduce variable pricing, so that customers could pay less for power during non-peak periods. Such “price signals,” spokesman Chad Luce said, could convince customers to voluntarily reduce demand, and therefore ease pressure for building more power plants in the future.

‘Essential factor’

Bill Moore, president and CEO of Topeka-based Westar, said that the Lawrence project would represent a “responsible yet meaningful approach” to deploying smart-grid technology in the company’s service area. Westar chose Lawrence because of its size and wide range of customers, including a mobile student population.

“This technology may be the essential factor in giving customers better choice and control over their energy usage, as well as allowing Westar to introduce programs to help curb demand and costs during times of peak usage,” he said, in a statement.

Westar’s responses to power failures also would become more effective, said Kevin Heimiller, the utility’s director for advanced metering infrastructure. Because the meters automatically would provide two-way communication between the utility and the customer’s home or business, Westar would know precisely which customers did not have power and when, allowing for restoration of service more quickly.

Even setting up an account — a common task this time of year in Lawrence, as thousands of college students change leases and addresses — would be more convenient for all parties involved, said Michelle Delka, who is set to manage information technology for the program in Topeka.

“It’ll take seconds” to switch an account, Delka said, instead of the few days it normally takes to arrange a service call.

Stimulus project

Westar would invest $20 million in the project, with the remaining $20 million expected from the U.S. Department of Energy through a Smart Grid Investment Grant, a federal stimulus program designed to improve efficiencies in the country’s energy system and among individual customers.

Westar’s investment in SmartStar Lawrence would be financed by all 684,000 Westar customers in Kansas, and would not require an immediate rate increase, said Karla Olsen, a Westar spokeswoman. Extending the smart grid throughout the Westar service area would be estimated to cost $150 million, and could be included applications for future rate plans.

While Westar is confident it will receive the full $20 million grant — which would be the maximum possible per applicant competing for a share of $1.32 billion available — the utility would need to reassess its plans if the federal share either was reduced or did not materialize, said Hal Jensen, a member of the SmartStar Lawrence team.

Westar submitted its application Tuesday afternoon, and anticipates hearing back about its prospects within three months. Actual financing could arrive by the beginning of February.

Installation of the new meters and related systems would be expected to take 10 months, with the entire SmartStar Lawrence program to be fully operational within two or three years.