M2M smart metering: where are we now?

Smart metering of utility services such as electricity and gas can deliver many environmental and business benefits for power companies, governments, businesses and home users alike.

Conventional utility service meters use mechanical, electro-mechanical or electronic counters to measure consumption. They are generally located in places that are hard to access and provide the customer with only the most basic information on their usage. 

A new generation of smart meters could change all that. By relaying meter readings over fixed or mobile data connections, they can provide detailed, real time information to the consumer and the utility company. 

Users are considered more likely to reduce consumption when they are aware of exactly how much they are spending on electricity and/or gas at any given time, while those who produce electricity via solar panels or wind turbines can see how much extra power they are generating and selling back into the national grid.

A Smart Grid is an intelligent networked grid that encompasses smart meters that are able to: 
measure consumption data and send this information to approved external third parties.
send and receive commands from these third parties.
act on these commands to adjust the operating regime of equipment or appliances linked to the Home Area Network.

A smart network would also be able to 
import and export electricity generated via micro generation. 
monitor the load at any moment to be able to recommend export or import behaviour to the end consumer.
exert control at all levels of utility production and transmission infrastructure, allowing real time adjustment to market demand and supply.

Smart metering is, therefore, a prerequisite to providing some measure of control over equipment and appliances linked to the Home Area Network. There cannot be a smart grid that influences equipment linked to the Home Area Network without a smart meter infrastructure

With M2M smart meters, energy producers could manage demand more effectively through banded tariff structures to encourage consumers to spread their use more evenly, thus reducing spikes in demand. 

Suppliers would expect to have to handle fewer phone calls from customers with meter related enquiries thus reducing their customer service costs. Smart meters could also reduce the need for sending out staff to read meters as the data will automatically transmitted back to the supplier.

Challenges of collecting data

Two of the major challenges for utility firms deploying smart meters are collecting and managing the massive volume of data generated by these devices. The adoption of interface standards is vital to the commercial rollout of smart metering projects and is the subject of collaboration between the European Telecommunications Standards Institute (ETSI) and the European Smart Metering Industry Group (ESMIG).

The organisations are looking at the various communications technologies proposed for use with smart metering systems, including wireless short-range communications, mobile communications and communications over wireless sensors networks. They will also consider the merits of power line communications particularly in multi-apartment dwellings (where there is a higher potential for wireless communications conflict) or in large homes that cannot be covered completely by one wireless network.

While the debate over the communications technologies that will connect the meter to the utility company continues, ZigBee is in a strong position to be the standard for in-the-home wireless links. ESMIG is working with the ZigBee Alliance to define interoperable communications standards for smart metering technology across the EU. 

The ZigBee Smart Energy public application profile, which will be used to provide the communications links between utility meters and household devices such as smart thermostats and appliances, is the first open standard to be endorsed by ESMIG. It is a significant step towards the development of networked home appliances whose operation could be controlled by the smart meter, which could suspend their operation at times of peak energy demand.

Once the information has been gathered, utility firms will face the challenge of ensuring their back office applications can handle the massive increase in data generated. When Pacific Gas and Electric Company, one of the largest combination natural gas and electric utilities in the US, implemented smart metering its data volumes increased 300-fold.

A number of leading technology companies have come together to form the Smart Energy Alliance [http://www.smart-energy-alliance.com/] in an attempt to maximise the commercial opportunities created by this convergence of information technology, communications and energy systems.

The early adopters

Europe and the US are at the forefront of smart meter implementation. Several European countries, including Sweden and Italy, already have extensive smart meter networks and other nations (including the Nordic countries, France, Spain and Ireland) have unveiled similarly ambitious plans.  And the UK government has committed to installing a smart meter in every home in Britain by 2020.

Across the Atlantic, President Obama's $787 billion economic stimulus package includes a commitment to install 40 million smart meters as part of the modernisation of the electric grid. According to research firm Parks Associates, more than 8 million smart electric meters have already been installed in homes across the US and the firm expects that figure to quadruple by 2011.

According to Berg Insight, the European smart metering market will experience compound annual growth of 20% between 2008 and 2013, reaching €2.3 billion at the end of this period. One of the reasons for this optimistic forecast is that consumers will foot at least some of the cost of the deployment of these meters through higher bills, making them an attractive investment for utilities wary of committing to large capital expenditure projects.

Strategy Analytics believes there will be around 88 million smart meters installed across Europe by 2014. The European Parliament has approved an agreement reached by the EU Institutions on a package of legislation to liberalise energy markets, including electricity and gas directives, which require EU member states to 'ensure the implementation of intelligent metering systems'.

The 2006 EC Directive on Energy Services called for 'competitively priced individual meters that accurately reflect the final customer's actual energy consumption and provide information on actual time of use'. The Electricity Directive foresees full deployment of such systems by 2022 at the latest, with 80% of consumers equipped with smart metering systems by 2020 (there are no deadlines in the Gas Directive). The European Parliament has also voted in favour of a requirement for all new buildings and buildings undergoing renovation to be equipped with smart meters.

This article was co-authored with Paul Golden.

Anthony Plewes

After a Masters in Computer Science, I decided that I preferred writing about IT rather than programming. My 20-year writing career has taken me to Hong Kong and London where I've edited and written for IT, business and electronics publications. In 2002 I co-founded Futurity Media with Stewart Baines where I continue to write about a range of topics such as unified communications, cloud computing and enterprise applications.