One of the goals of the Dubuque test is to show that getting consumers more engaged, by having them compete against each other or use social networking to exchange tips, can allow such projects to succeed.

"Our theory is that without engaging the end user, we will not see the kind of projected results that we've been told smart meters will unleash," said Milind Naphade, program director for IBM's Smarter City Services Research.

The initial results in Dubuque are promising. Of the 1,000 households with smart meters, 800 agreed to take part in the test, and 200 of those have logged into the website to track their energy use. The industrywide average for "energy portal engagement" is 8 percent, Naphade said, so the test in Dubuque has exceeded that.

Sixty households have gone a step further and signed up for "activity groups" built around particular projects, such as installing energy-efficient light bulbs. The households in activity groups have cut their energy use by 11 percent, Naphade said. The test will run from July to December so the results are preliminary.

IBM's software analyzes the meter data and puts households with similar characteristics into groups. They are then told where they rank compared to their peers. "We tell you whether you are number 15 or number 30 or whatever. We've found that to be a significant motivating factor," Naphade said.