EURELECTRIC policy workshop on the Business Challenges of Distribution Companies:

Finance, Regulation, Smart Metering

sponsored by

26 November 2009, Brussels

‘Smart Metering: An Enabler Bringing Benefits and Opportunities to All Participants in the Electricity Value Chain'

“Smart metering offers consumers, suppliers, network operators, generators and regulators a wide range of useful tools and services - ultimately enabling a smarter energy world,” John Harris of the European Smart Metering Industry Group (ESMIG) told participants at the EURELECTRIC workshop on The Business Challenges of Distribution Companies: Finance, Regulation, Smart Metering - held on 26 November in Brussels.  The roll-out of smart meters will facilitate demand side management of electricity use and promote energy efficiency as “it will provide direct customer feedback leading to both economic and ecological awareness,” he underlined. However, the benefits of smart metering will “be felt along the entire length of the electricity value chain” from power generator to consumer. Mr Harris nevertheless made the proviso that “smart metering is an enabler: it’s what you do with it that counts.”
 

Carlos Gonzalez from Spanish electricity association UNESA complemented Mr Harris’s presentation, adding that “smart metering is a high-potential technology which can help customers to be much more efficient in their power consumption and also improve the management of the distribution grids, thereby reducing energy losses.” Moreover “the installation of smart meters will equip DSOs even better to fulfil their role in facilitating seamless and reliable data exchange between suppliers and thereby enhancing customer choice by enabling him/her to switch supplier more easily.” However, there are a number of technical and financial barriers to the roll-out of smart meters, identified in a 2008 EURELECTRIC report.  Interoperability of the meter with others systems throughout Europe and the consequent extent of the standardisation needed in order to avoid inhibiting innovation are key questions that still need to be answered by policy makers, Mr Gonzalez stressed.  In addition, as the benefits of smart meters will be reaped by a range of actors, it would be unreasonable to leave DSOs with the entire burden of financing them. He therefore outlined various solutions for optimising and financing the roll-out of smart meters – including the creation of a governmental or social fund which would facilitate net cost recovery.

Looking at smart metering from the angle of the customer, Anthony Doherty of the European Commission’s Directorate for Energy stressed that “retail markets are becoming increasingly important and smart metering is a vital part of the development of retail markets.”  Mr Doherty listed some of the benefits of smart meters, including innovative time-of-use tariffs, more accurate billing and lower bills as customers enjoy better consumption feedback and can better manage their electricity use.  “Active consumers are the heart of an active retail market. Consumers with more information will change their consumption pattern,” he told the audience.