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SMART GRID TECHNOLOGY WHAT UTILITIES FACE AFTER THE SUCCESSFUL SMART METER ROLLOUT By Angus Panton, SQS Group Ltd Briefly put: What is the importance of assured reliability connecting devices? How can utilities increase performance and reliability of the functionality in connected devices? The figures are enough to make any mind boggle, even in the burgeoning technology of machine to machine (M2M) communications and the wider ‘Internet of Things’. Just take what’s happening in homes: by 2020, there will be more than 850 million smart electric energy meters alone in the world’s major economies – about half in China, according to a report by communications provider Telefónica. And The sheer volume of device rollout and the subsequent amount of data involved takes companies – and their customers – firmly into the realm of ‘big data’. This brings challenges in data processing, performance, storage and security. At stake is the trust of customers in their suppliers and in the technology – and already there are movements to resist the installation of smart meters owing to the ‘big brother’ Consider conventional utility meter reading, done manually by customers or a doorstep agent every quarter – and then compare that with the readings that would come in every half hour from millions of smart meters as they monitor energy usage in real time smart meters are just the tip of the iceberg – all manner of other utility and home appliance systems will be communicating with consumers and providers: from smart thermostats to alarm systems to the butt of many jokes, the fridge that tells you when it’s running out of milk. The rapidly expanding home automation and M2M markets give traditional utility suppliers not only a new route to greatly improving customer engagement and value, especially with the Smart Meter Implementation Programme, but also a way of moving beyond their core business into all manner of new home systems. But there’s a ‘perfect storm’ of factors that could derail efforts to develop this market. 48 aspect of their ubiquitous presence in people’s homes. That the amount of data will increase exponentially is not in doubt. Consider conventional utility meter reading, done manually by customers or a doorstep agent every quarter – and then compare that with the readings that would come in every half hour from millions of smart meters as they monitor energy usage in real time. Moves to extend into other home systems will only up the magnitude of the data and communications technology needed, and will place great pressure on the operational, billing and customer relationship system of utilities, which in countries such as the UK have not been shining stars in having user- friendly IT systems. But utility firms are among the pioneers in customer-facing M2M – and they have to be, as there are regulatory mandates from governments to roll out smart meters, as Vodafone’s latest M2M barometer report confirms. A move in the next few years for all industrial sectors will be from using M2M in internal systems such as operations and inventory, to externally with customers. Vodafone says the sector is currently among the leaders in external M2M adoption – already 20% of utilities and energy firms it surveyed have now adopted smart grid and smart metering systems, and 17% have also introduced smart home and office offerings – a category that includes home automation, intelligent heating and security systems. As mandated, the rollout target for the UK’s smart meter programme is to replace 53 million conventional domestic power and gas meters in about 30 million premises by 2020. This is Britain’s biggest home energy technology change for more than 40 years. The European Union has set a target of 80% of electricity meters within the EU to be ‘smart’ by 2020. Major challenges for companies lie in developing IT applications that underpin these rollouts – these are systems that combine new devices and usability issues, integration across networks to company operations and billing systems, and sheer scale. One of the key issues at stake is user acceptance and experience of new home automation technology. Once consumers install devices such as smart thermostats, they will expect operation to be at least as reliable as old mechanical or electrical timers. Dangers lie not just in initial hardware and operating software but in regular updates, which could break functionality owing to METERING INTERNATIONAL ISSUE - 5 | 2014