Alastair Masson, client partner at NTT DATA, explains why the energy sector must follow the lead of the telecoms industry and introduce a set of international smart metering standards.
The contrasting ways in which countries are approaching smart metering feels like an appropriate topic for discussion as the summer draws to a close. In many ways, it’s similar to selecting the best way to climb into a mid-temperature, late-summer swimming pool. As anyone who has approached this problem recently will tell you, there are two distinct options available. Either you jump straight in or you ease yourself in gently over a longer period of time.
The same seems to be true for the adoption of smart meters. Countries like Italy, for example, have opted for the former method – choosing to roll out more than 30 million smart meters in what is the world’s largest smart meter deployment. Other countries like the UK have, it’s fair to say, taken the second option and decided introduce smart meters slowly over the course of a number of years.
In 2009, the United Kingdom’s Department of Energy and Climate Change announced its intention to install smart meters in all British homes. However, the policy of gradual acclimatisation that it recommended means that, assuming the rollout is completed on time, this objective will not be met for another six years. And, by this time the UK will lag even further behind its continental cousins. As the UK looks to slowly emerge from the dark ages of energy management with the deployment of more smart meters, what implications could the deployment of this technology have for the industry as a whole?
Perhaps the biggest danger is that, as smart meters become more commonplace, the market for them will inevitably become increasingly crowded. As a result, we could start to see energy suppliers trying to push newer, more innovative services that guarantee better transparency of services purely as a means of differentiating their services, with little or no benefit to consumers. So where do we draw the line and ensure that the end-user’s interests aren’t trampled in the stampede to embrace innovation?
It’s a question that may sound familiar to those in the telecommunications industry, another sector that has seen (and, indeed, continues to see) a steep curve of growth as a direct result of innovation in mobile technology in (relatively) recent years. As an industry, it managed to address the issue of consistently pushing innovation as a means of differentiation by introducing the Global System for Mobile Communications (GSM) as an international standard of uniformity. As a result it was able to ensure uniformity and fairness for end-users while still encouraging innovation.
It’s a great example of how, as smart metering becomes more and more commonplace over the coming years, the energy industry could benefit from the increased uniformity across all suppliers that a set of international standards would ensure. The success of smart metering and other similar tools clearly demonstrates that there’s a real appetite for innovation in the UK energy sector. For this reason, it’s vitally important that standards are in place to ensure these innovations are rolled out in a way that is fair for both suppliers and consumers alike. This would, at the very least, ensure that any technology introduced is done so for the sole benefit of the consumer and not as a ‘gimmick’ aimed at differentiating services.
The UK may be lagging behind some other countries when it comes to its adoption of smart meters, but perhaps this gradual approach is no bad thing if it leads to a fairer rollout of these services for both consumers and suppliers. If the telecommunications industry is any indicator, then the best way to introduce technology like smart metering and establish it is to ensure that that it is governed by a set of standards (ZigBee is one such example). Who knows – if the energy sector follows suit, perhaps it won’t be too long before smart meters are finally able to make a splash in the UK?