Utilities: from smart metering to the smart grid
Here’s is my second blog post from the 7th Annual M2M & Connected Devices event in Brussels in September 2012. You can read the first post here.
One of the most talked about markets for M2M is in the utilities sector. A key driver of this interest is the EU’s 20:20:20 target, which mandates a “20% increase in energy efficiency, 20% reduction of CO2 emissions, and 20% renewables by 2020”. M2M can help in this drive in the shape of smart meters and ultimately the smart grid.
At the event, the growth of “smartness” in the utilities sector was discussed by a panel that included representatives from all parts on the industry. They were: Jean Baptiste Galland, Director Strategy and Smart Grids, French electricity distributor Electricité Réseau Distribution France (ERDF), Valerie Le Peltier, M2M Vertical Director, Orange Group, Roman Picard from CRE, which is the French energy regulator, and Alan Atkins, Global Head, M2M at Logica Sweden.
smart meters driving energy efficiency
According to Galland, ERDF has already deployed 300,000 smart meters in France to help achieve increased energy efficiency. It plans to roll them out country-wide by 2018, which represents a phenomenal 35 million units!
Atkins from Logica, presented information from Sweden, which was an early adopter of smart meters. The first models were deployed in 1999, but these were effectively just remote meter readers. Today there are 5.3 million smart meters in operation in a country that has a population of just 9 million (this is explained by the high number of second homes).
The latest smart meters do much more than just remote reading, they also assess voltage and current output. Atkins says that the market is still evolving, with many different technologies in operation, which makes it hard to have a coherent view across all meters.
building the smart grid
The smart grid takes the information from across the network, including smart meters, to allow the electricity distributor to act more intelligently. It can control supply and demand in the network. This allows the distributor to ensure energy supply security to avoid shortages and provide customers with differentiated tariffs. There is an interesting book from panel participant Logica that explains the concept of the smart grid, which you can read online.
“We need to manage the load. We are facing more volatile demand. This makes it hard to manage the network. If the smart meter can help us do this – we will use it,” explains ERDF’s Galland. Already part of its network is smart – the medium voltage network – but this smartness needs to be extended to the low-voltage network with the deployment of smart meters. This smart grid has already proven success in France. “When we had a big storms it has this helped prevent power cuts [by rerouting supplies],” says Galland. “In addition, we have increased storage capacity in our low-voltage network that helps us use photo-voltaic power more effectively.”
role of regulator
So in all of this, what role does the regulator have? Roman Picard from CRE says that it is pushing the deployment of smart meters in France. It looked at the cost benefit for all parts of the market, including users and not just the suppliers. CRE did its first analysis in 2007, and the most recent one in 2011, determined that smart metering was good for the entire market.
Scandinavia moved towards its wide use of smart metering without the involvement of regulators says Logica’s Atkins. However, the country now has a wide range of technologies in use and would benefit from standardization. Picard points out that that regulators would not choose one technology over another as it would affect the free market in technology.
The smart grid can only happen if all stakeholders work together, including telecommunications providers. Picard says that there needs to be a business model that works for the whole value chain. Consumers, for example, need to an added benefit from this smartness, not just higher bills.
There are a number of value-added applications that can be enabled by smart meters and the smart grid. On the consumer side, users will be able to operate their smart meter remotely and analyze their consumption. It can give them better information about the impact of different home appliances or services, for example.
For suppliers, they will gain valuable information on the power that consumers are using. It is also a great source for ensuring that equipment is working and locating need for preventative maintenance or any faults that need repairing. This will help keep the grid in better shape. Overall, it allows them to manage the power grid more effectively, by balancing supply and demand along with offering more intelligent tariffs.
I will write a third post from the event covering the evening session next week.