Water, gas and electricity suppliers, otherwise knowns as utilities, are installing smart meters as part of an overall attempt to improve efficiency in their networks, reduce unexpected demand and cut wastage.
Governments worldwide have been pushing utilities to build smarter infrastructure. “Smart meters will allow you to actually monitor how much energy your family is using by the month, by the week, by the day, or even by the hour,” said President Obama in 2009 when he announced a $3.4 billion investment in the Smart Grid. “This is going to help you manage your electricity use and your budget at the same time,” he promised.
Already in the US 43 percent of homes (around 50 million) have smart meters installed, claims the Edison Foundation’s Institute for Electric Innovation. Worldwide, nearly 210 million smart meters have been installed as of 2014.
While at least some of the costs are being passed over to energy consumers, current estimates suggest power utilities will invest $17 trillion in global infrastructure through 2035. These investments could generate significant economic benefits, for example, Eurelectic predicts innovation by utilities could be worth €70 billion to the European economy by 2030.
The scale of these investments is huge. In South America, Ben Gardner, president of Northeast Group predicts spending of “$22.6 billion in smart metering, $7.2 billion in distribution automation and $8.3 billion in other smart grid market segments over 2015 to 2025."
Similarly in the UK energy suppliers are rolling out 53 million smart gas and electricity meters across Britain by 2020, with 1 million already installed and the Asia-Pacific region is expected to account for almost 65 percent of the global installed base by 2020, when 780 million meters are predicted to be in place.
Attempts to meet these targets puts utilities under pressure to install millions of meters in a relatively short period of time. Achieving this means they must successfully handle scheduling, appointment management, order assignment, data capture and asset tracking challenges.
Rollout hampered by challenges
The issues faced by utilities engaging in these projects are extremely varied. Around 8 percent of meter exchanges have issues during or soon after installation – the wrong meters are exchanged, incorrect meter ID’s are logged, meters are incorrectly read and/or the relevant paperwork is lost. This is even before more prosaic challenges such as the danger to utility staff posed by roaming pets, absent homeowners or meters situated in inaccessible locations. Another problem as digital technology evolves being the longevity of those smart meters already seeded in the wild.
One part of the smart meter promise is that consumers gain the power to micromanage their own energy use, and choose the best available tariffs suitable for their needs.
In a speech in November 2013, UK energy minister, Lord Bourne, repeated these promises, saying smart meters mean, “Consumers will be empowered to manage energy costs like never before and avoid unexpectedly high and inaccurate energy bills. More and better data from smart meters will enable consumers to make more informed choices when choosing their energy supplier and getting the right tariff.”
Yet realizing the potential here also requires that energy providers successfully facilitate and empower their own consumers. This has not happened in the US, while most utilities offer consumers Web portals through which they can access their data, the solutions available haven’t matched the promise.
They have had “difficulties attracting customers to access and use their Web portals, and the ultimate value of these tools is still an open question,” according to the US Department of Energy. The experience differs in different countries. UK Energy Minister, Lord Bourne cites a Smart Energy GB finding that “84 per cent of those with smart meters installed would recommend them to others”.
A 2013 survey by Smart Grid Consumer Collaborative found that only 8 percent of people were already using “online analysis of your specific energy usage” provided by their energy or utility company. (Some providers get better results from pre-pay metering users). Confusing pricing tariffs, lack of dynamic pricing and an absent of disaggregation (insight into how much power each home appliance uses) stymie the mythical holy grail of putting control into customer hands.
All the same there are some advantages. Already smart grids are translating into fewer power outages and reduced operating costs as meter readers get sacked – but even then there is no guarantee those operating cost savings actually get passed onto consumers.
There is also the possibility that in future additional services may be made available via the smart grids. That’s a future in which, “consumer devices linked to the meter provide a range of services, such as reassurance about the well-being of elderly relatives; and smart appliances communicate with smart meters and use energy when it is cheapest,” said the UK energy minister. That’s the kind of Machine-to-machine (M2M) technology that will enable new levels of consumer convenience and services through the smart grid.
Jon Evans is a highly experienced technology journalist and editor. He has been writing for a living since 1994. These days you might read his daily regular Computerworld AppleHolic and opinion columns. Jon is also technology editor for men's interest magazine, Calibre Quarterly, and news editor for MacFormat magazine, which is the biggest UK Mac title. He's really interested in the impact of technology on the creative spark at the heart of the human experience. In 2010 he won an American Society of Business Publication Editors (Azbee) Award for his work at Computerworld.