Report compares challenge of smart meter roll-out to creation of internet
Peta Hodge
14th January 2010
A new report highlights the massive challenge the roll-out of smart metering will pose for countries throughout western Europe – arguing that, as a telecommunications project, it is on a par with the creation of the internet.
The report, by market analysts Datamonitor, values the smart meter market across western Europe at between 15 and 26 billion and claims utility and telecoms industry processes in competitive markets such as the UK will need to be re-designed ahead of the roll-out.
“Effectively what we are talking about is the construction of a machine-to-machine communications infrastructure to rival the ‘online’ facilities that we have come to enjoy,” said the report’s co-author, Alex Desbarres.
A spokesperson for Datamonitor said there was no suggestion that the UK in particular has underestimated the scale of the smart metering project.
The criticism that governments are are not being explicit enough in their aims for the roll-out, and that gaps are appearing in the delivery of potential benefits as a result “are applicable across Western Europe”, he said.
However, the report does express concern that the UK is not giving proper consideration to implementing roll-out through power line carrier (PLC), favouring instead general packet radio service (GPRS) and utility radio.
The report says that in Italy, a 30 million household rollout proved that PLC implementation works well and is cost-effective.
“The Italian experience would indicate that PLC technology option is worthy of further consideration,” said Desbarres. “A significant proportion of the required asset infrastructure for PLC is already in place in the UK.”
Another area in which the UK and others can learn from the smart meter pioneers is communication, the report says.
It claims that failure to communicate the financial, social and environmental benefits of smart metering was partly to blame for the public outcry which threatened the Netherlands’ roll-out and led to litigation in parts of the US, where the public associated smart metering with increased costs.
On the the other hand, it highlights the examples of the province of Ontario and the state of Victoria, which managed to retain public confidence in smart metering by communicating the benefits from an early stage.
Addressing customers’ concerns over privacy and security issues prior to roll-out is particularly important, the report suggests. In Ontario, such concerns were addressed by stripping out customer information fields from the data before onward transmission by distribution network operators.
The UK Government announced its plans for rolling out smart meters last month, confirming that energy suppliers will be responsible for installing smart meters in all their customers’ homes by 2020.
It also confirmed that the communications between smart meters and the utility companies will be centrally co-ordinated, to ensure easy switching between suppliers, and to provide a platform for the development of smarter grids in the future.
The Datamonitor report welcomes this centralised approach, arguing that it represents an opportunity to “simplify and streamline the energy industry and rectify long-running data transfer issues between different players in the market”.