Smart meters: A Win-win Solution

With energy conservation playing a significant role in the future economy, smart meters are here to stay to help companies measure their energy efficiency efforts.

Energy conservation is critical for the economy, especially if one considers that 25,000 megawatt of capacity will be created through energy efficiency in the electricity sector alone, according to the Ministry of Power.

The potential for conserving energy in the economy stands at an astounding 23 per cent with industrial and agricultural sectors contributing the most. Almost a decade ago, the Government of India recognized the critical nature of energy conservation, with the result being the Energy Conservation Act 2001, and the setting up of the Bureau of Energy Efficiency under the Ministry of Power.

The Bureau of Energy Efficiency has for some time been awarding ‘Star Ratings’ for electrical appliances like refrigerators and air conditioners. It has taken an initiative to extend the Star Ratings to buildings too, launching the Energy Conservation Building Code for commercial buildings and an annual examination to certify energy auditors and energy managers.

How effective would these initiatives be without users adopting them and without the widespread awareness of energy saving opportunities? How can energy utilities (electricity or gas) innovate? How can buildings, residences, offices or industrial premises, be made more energy-efficient?

Smart meters

A smart metering solution, as part of the Smart Grid, is considered to be one such way! Smart meter deployment has already begun in various countries. In March this year, British Gas, UK’s leading energy supplier, announced the first commercial-scale smart meter deployment. The deployment is expected to save consumers more than $300 million in their power bills.

What is in it for manufacturers?

According to Pike Research, “major utilities worldwide, enticed by savings and prodded by governments, are embarking on wholesale replacement of over 45 per cent of the North American and European installed base by 2015, breaking the traditional 15-20 year meter replacement cycle. This represents an unprecedented— and time limited—opportunity for meter and communications suppliers as a projected $19.5 billion of smart meters are deployed worldwide between 2010 and 2015.”

The research agency forecasts that the worldwide smart meter market will grow an aggressive 19 per cent CAGR through 2015. Apart from the actual meters, such a deployment will lead to a market for ‘smart’ household appliances, from self-regulating air conditioners to smart refrigerators.

A smart air conditioner or i-AC, for instance, can save approximately 20 per cent of energy as compared to a regular AC. The i-AC uses infrared sensors to detect individuals in a room and directs cool air accordingly for automatic control of the room’s temperature. Embedding further intelligence, this feature can be extended to a ceiling fan. Depending on the peak load information sent by the smart meter and the room temperature, the air conditioner and the fan operate alternatively.

How smart is smart?

Smart meters measure the power consumed, store all relevant consumption data allowing consumers real-time access and communicates this data to the utilities. The meters can be integrated into the existing management and accounting systems of measurement service providers and suppliers. The end user having direct and real-time access to electricity consumption data, creates transparency and an incentive to save energy.

An end-to-end smart meter system includes features such as smart meter reading, meter data management, consumption data aggregation, pricing based on existing tariffs, transmission to partner systems, real-time processing and a web portal for current customers (similar to the consignment tracking feature provided by courier companies on their websites).

Effective work

For smart meters to work effectively, they need to communicate smoothly with the utility’s systems. The data need to be error-free and easily integrated into the business applications to aid in analytics, for instance, Business Support Systems (BSS) for customer management, tariff determination and the payroll, online customer portals and Enterprise Resource Planning (ERP) systems.

The best smart meters are intelligent, open solutions that are modular, multi-client that covers all the commercial applications of the smart metering processing chain for homes like meter reading (automatic meter reading), counter remote control (automatic meter management) and customer management and billing (BSS).

The meters are characterized by reliability, high throughput and maximum flexibility based on configurable rules. These support a variety of protocols and data formats, including the popular formats in the smart metering field count.

When sent a query, the smart meter reading solution reads and transmits the data to the related business applications where it is converted and processed. This helps in customer relationship management, particularly in customer billing, which supports a wide range of tariff rules as variable over time, and are event-based, like ‘critical peak pricing’ or dynamically in the form of 15-minute interval-based price curves.

In the final bargain, smart meters, smart grids and smart devices are a win-win for all stakeholders: the consumers, utilities, providers of services like information technology integration and embedded engineering, manufacturers, the government and, not the least, the environment.

This article appeared in the August 2010 issue of "Industry 2.0 - Technology Management for Decision-makers" 

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