"Smart meters really allow two-way communication between the utlity and the meter so that we can get real-time information about loads and operation at the house," says CMP spokesman John Carroll. Carroll says that with smart meters, consumers can get a meter reading right off the Internet. "Folks will start to automatically conserve and look for ways to be more efficient. So that, apart from cutting down on energy usage, will save them money."

Advocates of smart meters say they will set the stage for changing the way that electrity is priced in the future. Utilities in other states are already offering so-called dynamic pricing plans, which make it cheaper to use electricity during off-peak times, when demand is lower. By reading their smart meters, consumers would know when to run their washer or dryer. Carroll says all this could lower sales for electrity suppliers. At the same time, they might not have to rev up expensive generators at peak times.

Others are more skeptical about how smart meters will be used. "There are going to be customers who may not like this," says Dick Davies is the state's Public Advocate, who represents Maine consumers. H e is concerned that dynamic pricing will one day become mandatory for everybody, and some consumers will be caught unawares.

"So the little old lady who has been very conservative and tries to avoid using electricity may discover that the times of day that she uses her electricity -- mornings, 8, 9, 10 o'clock in the morning, and afternoons, 4 to 8 or so, may become fairly expensive," Davies says.

State regulators, however, are unlikely to approve any kind of pricing plan that's not voluntary, says Evelyn deFrees spokeswoman for the Maine Public Utilities Commission. "The commission is sensitive to people's worries on this and it's just not likely at this time that new metering technology would be mandatory." DeFrees says the commission encourages smart meter technology, but will still require CMP to provide the details of its plan.

To buy the smart meters, CMP has to contribute about $100 million of its own money. DeFrees says the commission will determine whether that is economically feasible for the company. If all goes as planned, CMP says it plans to install the smart meters over two years starting next April, without having to raise rates for customers because of the savings they say the meters will provide.

The federal funds come as CMP is asking the PUC to approve its $1.4 billion plan to upgrade its transmission systems. DeFrees says the impact of installing smart meters will have to be considered as part of that request. "The Maine Public Utilities Commission is deliberating on the need for the project, and if you have new technologies which are meant to be more efficient that might have an effect the assumptions about load growth in the future -- theoretically bringing down the load."

Maine's other major utility, Bangor Hydro-Electric Company, says it already has smart meters and applied for about $4 million to upgrade them, but did not receive any of the recently-awarded federal funds. The company says it still plans to go ahead and improve the meters, which can be read remotely but do not currently provide real-time information to consumres.