The government's£10bn planto replace almost 50
million gas and electricity meters over 20 years is a golden prize
for information and communications services firms.
Not only will it put an "always-on" communications link into
every house, flat and office, and require the collection and
storage of petabytes of information, but it has the potential to
allow energy suppliers to control consumers' energy
consumption.
The government hopes information from smart meters will be
enough to persuade consumers to use more off-peak energy. But if
they do not, smart metering opens up the possibility for suppliers
to ration consumption, by allowing them to switch off networked
appliances at times of peak demand.
Key to this is the communications network. The government has
proposed three possible scenarios. The option preferred by the
government and energy suppliers is for a purpose-built independent
third-party national network operator. This would allow energy
suppliers to install and maintain the meters, without taking on the
risks associated with running the communications and data storage
network.
All homes with a telephone line already have a nominal 56kbps
link. BT, the UK's biggest fixed wire network operator, is
keen to explore how this project might integrate with its
plans, including its possible obligation, to provide a
2mbps broadbank link to British homes.
Reliable broadband essential
But linking smart meters to the telephone system, particularly a
broadband network, might not work, says Mark England, managing
director of electronics design specialist
Sentec. Sentec licenses its
smart meter designs to manufacturers which build units for the US
and Italian markets.
He says broadband may be okay for consumers because they can
usually afford to wait for their information. But energy firms
cannot, especially if they are trying to manage consumption on the
fly. Even though data rates of 100k a day may be all they need, the
connection must be up 24x7. Britain's broadband networks are not
that reliable.
The government's department of business (BERR) said it had
talked to the energy department about whether a smart meter
roll-out would make a universal broadband roll-out more
cost-effective.
"Currently we believe that this is unlikely because firstly, the
meters do not need the bandwidth of broadband, and secondly, energy
suppliers need 'always-on' communications that consumers cannot
switch off," says a spokesman.
Smart meters offer the potential to introduce smart grids, which
interconnect machines rather than people, says England. For
example, the smart meter could become the portal to other networked
devices such as home surveillance equipment, refrigerators or
air-conditioning units. This would allow electricity suppliers (or
owners) to switch devices on and off remotely to minimise peak
loads.
It would also let suppliers offer innovative service packages,
England says. One might be a consumer's commitment to keep peak
consumption below say 3kW in return for a cheaper price, but to
suffer a trip if consumption goes above the limit.
"This means there is a lot more information flowing up and down
in real time, so network reliability and guaranteed quality of
service are mandatory," he says.
England believes different physical networks will be optimised
for the terrain. He says the cellular telephony network works fine
in densely populated urban areas, but GSM modems presently cost
more than the meter equipment. Rural areas may need cable and/or
multiplexed wireless connections.
The key to cutting the UK's carbon emissions is to reduce peak
load and raise base load. As James Forrest, vice-president of
CapGemini's utilities consultancy, puts it, "The aim is to keep
the beer just cold enough."
Petter Allison, director of smart metering at British Gas, told
a recent conference that a 2% reduction in consumption would pay
for the cost of smart meters. US experience suggests some consumers
will change their behaviour. It shows cuts of 5% to 15% in energy
consumption, says England.
It's that, or developing a taste for warm beer.