Update: Smart Metering in Europe

The EU has mandated that member states introduce smart metering in homes and businesses by 2020, to understand and monitor energy consumption with the aim of reducing usage, and ensuring reliability of supply.


The EU has mandated that member states introduce smart metering in homes and businesses by 2020, to understand and monitor energy consumption with the aim of reducing usage, and ensuring reliability of supply.

Beecham Research attended Synergy’s recent conference in London on Smart Metering in the UK and Ireland. This event focused on the business case and consumer acceptance, compared with the previous year which focused more on technology. Smart metering is likely to be mandated for every home and business in the country, hence gaining consumer confidence and providing incentives for their cooperation is essential for success.

As of 2010 smart metering in Europe is at a crossroads, with basic functional issues and requirements agreed, but with detailed implementation issues still under consideration.

Smart meter trials in the UK and Ireland.

We heard from Maxine Frerk of Ofgem’s Sustainable Development Division that the new coalition government has confirmed plans to install smart meters in every UK home by 2020. The UK now has 47 million meters in total. At present Ofgem is gathering evidence from stakeholders regarding the very many business processes involved in the delivery chain, as well as considering issues of data management and securing customer acceptance and confidence. Collaborative stakeholder engagement is vital to success.

So far Ofgem has decided that consumers will have an in-home display that will allow them to see and therefore better manage their energy usage. At the head end, there will be a centralised communications model for collection and management of the aggregated data. Issues that are yet to be decided include:

– what parts need to be mandated and what should be left to the market – impacts on wider processes of the utility industry – ensuring interoperability between the players involved.

Ofgem will publish its prospectus containing detailed proposals later in the summer.

British Gas is a major UK supplier. Its Director of Smart Metering Petter Allison revealed plans to install two million smart meters by the end of 2012. Operations would be in-house, whilst partners would be enlisted to develop capabilities and deliver end to end service. He highlighted the need to engage future consumers to reduce consumption, as well as offer them a choice of ways to pay. Experience gained during early trials should catch problems before full scale rollout, and identify impacts of the transformations involved.

In Ireland, the CER’s (Commission for Energy Regulation) Paul O’Neill reported that two types of trial were concurrently underway: a technology trial evaluating different communications options from meter to central office (e.g. power line, GPRS), and customer behaviour trials to gauge customer demand for and reaction to the new meters.

The trials will end in December 2010 and the results will inform decisions on business case and future rollout.

Howard Porter of BEAMA (the UK body for the electrical sector) and representing ESMIG cautioned against ignoring the work that the EU was doing. The EU’s Task Force for the Smart Grid has three expert groups which recently published smart meter requirements in respect of functionalities, data safety, and roles and responsibilities.

Elsewhere in the EU, smart meter rollout in the Netherlands has been suspended following fears regarding consumer privacy, citing Article 8 of the European Convention of Human Rights. Whether consumers will have the right to refuse to have smart meters in their homes is under debate at present, but could have a significant impact on rollouts in member states.

The possibility of using the same smart meter for measuring water usage was also discussed, as water is likely to become a scarcer commodity in the future.

Communications technologies

Jason Pace from US-based supplier Silver Spring Networks advocated the use of wireless mesh, now being trialled in the US and Australia. This is not possible in Europe at present due to spectrum constraints, but a blended network comprising both wireless (cellular) and wireless mesh could be a future option.

Data issues

Smart meters will generate immense amounts of new data which will need to be managed and analysed, according to Oracle. This will include operational data, representing the behaviour of the grid and from instruments not directly associated with energy delivery, as well as actual meter usage data. Some data will need to be processed immediately while some could be aggregated and processed later. Much could be learned from industries such as financial services and the airline industry, which routinely handle large volumes of data, as to how to manage this data effectively and securely.

Customer acceptance trials

Several speakers presented on this topic including the consumer watchdog Consumer Focus, Warwick Business School, Oxford University and Accenture. Issues included the importance of getting customer trust, devising new forms of payment (smart prepay) and introducing smart meters in conjunction with home refurbishments. Early results were encouraging, showing that consumers largely understood the benefits of smart metering and were willing to change their behaviour to reduce their bills.

The Smart Grid – Home Area Networks

Smart meters are a part of the Smart Grid of the future which will connect with the Utility office, as well as interact with a larger network connecting power stations and energy suppliers and eventually, Home Area Networks (HAN’s). Designing smart meter networks should anticipate future interoperability with intelligent appliances.

In summary, smart meters are only the tip of the iceberg of tomorrow’s smart grid.

It was clear from this conference that all players – energy and equipment suppliers, government and consumer bodies – now realise the immense complexity of the smart meter (and smart grid) supply chain, and the need to design the grid with all parts in mind.