Electricity usage exhibits a massive demand curve, peaking in the afternoon and sloping down at night. The peaking plants used to produce afternoon power are highly inefficient to operate (see graph), and drive up your utility bill. Although electrical bills reflect the average price of production, peak power really skews this calculation. Thus, programs and policies such as smart metering are gradually gaining support as governments look for solutions to smooth the natural demand curve.
There are some really cool things you can do with smart metering. I even wrote a policy proposition paper over smart meters to land my current job. Ironically, I'd like to see smart metering rendered useless.
My approach to solving issues of demand curve requires a technological leap or two, but isn't that far off. As energy storage systems (batteries, flywheels, pump storage, etc.) become more efficient, you can (economically) store more energy to release during peak demand hours. Then you can smooth the supply curve and produce at a constant level all day long. At four in the morning power plants would produce excess that is stored. At four in the afternoon electricity is underproduced, but the excess is then released into the system.
This makes electricity really cheap because crappy peaker plants are phased out. As a result, we get to keep more energy-intensive industries at home. As the U.S. postures closer to a tariff tit-for-tat with China, we might even regain some lost manufacturing such as steel production. Making tangible things domestically again would be really, really sweet. Additionally, more efficient energy storage solves problems of intermittency with renewables and makes the hippies happy.
Cheaper electricity, economic development, facilitation of clean energy, and awesomely huge flywheels across the nation. Furthermore, the prospect of smoothing production without screwing with demand minimizes deadweight losses. These are things you can't argue with. The title of this entry is one of my top 5 favorite songs. Even if you're not a fan of Americana, it's hard to argue with the greatness of this joint.
Look How Much Peaking Power Costs In The Summer!
Graph stolen from: 'Demand Side Management,' Energy User News, August 2004, Volume 29, No. 8