Consultation on Possible National Rollout Scenarios for the ...CER10082 Possible National Rollout Scenarios for Smart Metering Cost Benefit Analysis 8 This consultation paper is the

Consultation on Possible National Rollout Scenarios for the Smart Metering Cost Benefit Analysis

DOCUMENT TYPE:

Consultation Paper

REFERENCE:

CER10082

DATE PUBLISHED:

11th June 2010

CLOSING DATE:

23rd July 2010

RESPONSES TO:

Gary Martin [email protected]

The Commission for Energy Regulation,

The Exchange, Belgard Square North, Tallaght, Dublin 24. www.cer.ie

CER – Information Page Abstract: This consultation aims to get feedback on possible functional requirements for a national smart metering rollout in order to inform the cost benefit analysis for smart metering in Ireland. The paper covers electricity and gas smart meters for residential and all non-profile metered business customers. The consultation sets out the strategic objectives for smart metering, many of the key issues/questions surrounding the functionality of a smart metering solution and invites respondents to give their specific feedback. The consultation also sets out a number of possible smart metering functionality scenarios in order to help draw out the issues associated with the implementation of smart metering and looks for feedback on these. This consultation paper is the first in a series of consultations that, in tandem with findings from the smart metering trials currently underway, will aim to bring more clarity to the myriad of issues surrounding a full smart metering implementation in order to inform the cost benefit analysis for smart metering in Ireland.

Target Audience: This paper is for the attention of members of the public, the energy industry, customers and all interested parties. Responses to this consultation should be returned by email, post or fax and marked for the attention of Gary Martin ([email protected]) at the Commission. The Commission intends to publish all submissions received. Respondents who do not wish part of their submission to be published should mark this area clearly and separately or enclose it in an Appendix, stating the rationale for not publishing this part of their comments.

CER10082 Possible National Rollout Scenarios for Smart Metering Cost Benefit Analysis

3

Executive Summary This consultation aims to get feedback on possible functional requirements for a national smart metering rollout in order to inform the cost benefit analysis for smart metering in Ireland. The paper covers electricity and gas smart meters for residential and all non-profile metered business customers. Firstly, the consultation sets out the strategic objectives for smart metering (listed below) and invites respondents to give their specific feedback:

• Promote energy efficiency • Improve peak load management • Support renewable and micro generation • Enhance competition and improve consumer experience • Improve network services

The consultation then explores many of the key issues and questions arising from the increase in data quantity and quality available from smart metering and invites respondents to give their feedback in relation to the specific areas listed below:

• Granularity of data requirement • Access to data for Suppliers • Access to data for Customers • Data required for billing • Data required for prepayments • In Home data requirements:

o Data flows required for web service in the home o One way data flows to an IHD o Two way data flows to an IHD o Data flows required for smarter homes and smart grids

• Data ownership and security • Vulnerable Customers

The paper then proceeds to set out a number of possible smart metering functionality scenarios and looks for feedback on these. It is highlighted that these scenarios should not be read as proposed solutions, but are merely presented to help to draw out the issues associated with the implementation of smart metering.

• The first functionality scenario covers the “core” functionality requirements which may be deemed necessary to deliver the key strategic objectives of smart metering, as outlined in Section 2 of the paper, while also meeting the requirements of the various EU legislative directives outlined in


4

Section 1. This is Scenario A: Core smart metering system functionality, supporting remote meter reading, multiple supplier tariffs, profile data and remote operation.

• The second functionality scenario (Scenario B) posed in the paper builds on the core functionality outlined in Scenario A by adding additional functionality to provide real time communications (one-way and two-way) between an in-home display (IHD), or equivalent device, and smart metering systems.

• The third functionality scenario (Scenario C) posed in the paper adds even richer functionality into the smart metering system (incremental to that already outlined in Scenarios A and B) to support the concepts of smarter homes and smarter electricity networks.

Finally the consultation outlines the high level implementation timelines that may be associated with a full smart metering roll out in Ireland and invites respondents to give their specific feedback:

• Phase 1: Discovery, Exploration and Business Case Development • Phase 2: Planning, Requirement Definition, Procurement and Selection • Phase 3: Detailed design, System testing and Pre-Deployment roll out • Phase 4: Deployment Phase

This consultation paper is the first in a series of consultations that, in tandem with findings from the smart metering trials currently underway, will aim to bring more clarity to the myriad of issues surrounding a full smart metering implementation in order to inform the cost benefit analysis for smart metering in Ireland. This cost benefit analysis will ultimately deliver a robust economic assessment of all the long-term costs and benefits to the market and the individual consumer of a national smart metering rollout and will also indicate which smart metering functionality scenario is the most economically reasonable and cost-effective, and which timeframe is feasible for its implementation.


5

Table of Contents Executive Summary ......................................................................................... 3 1.0 Introduction .............................................................................................. 7

1.1 The Commission for Energy Regulation ................................................... 7 1.2 Purpose of this paper .............................................................................. 7 1.3 Background Information ......................................................................... 8

1.3.1 What is Smart Metering? .................................................................. 8 1.3.2 EU Legislation ................................................................................ 10 1.3.3 EU Initiatives .................................................................................. 13 1.3.4 Smart Metering Roll-out Status in Europe....................................... 13

1.4 Structure of this paper ......................................................................... 14 1.5 Responding to this paper ...................................................................... 15

2.0 National Smart Metering Programme – Objectives and Status ................... 16 2.1 Introduction ......................................................................................... 16 2.2 Objectives of the National Smart Metering Programme .......................... 16 2.3 Smart Metering Progress in Ireland ....................................................... 17

2.3.1 Government Policy and Legislation .................................................. 17 2.3.2 CER Smart Metering Project Phase 1 .............................................. 18

3.0 Ownership, Display and Provision of Information ..................................... 20 3.1 Introduction ......................................................................................... 20 3.2 Granularity of customer data ................................................................ 20 3.3 Access to data for Suppliers .................................................................. 21 3.4 Access to data for Customers ................................................................ 22 3.5 Information on Bills and Frequency ...................................................... 23 3.6 Data required for Prepayments ............................................................. 23 3.7 In Home Data ....................................................................................... 24 3.8 Data Ownership and Security ............................................................... 26 3.9 Vulnerable Customers .......................................................................... 27

4.0 Smart Metering System Functionality Scenarios ....................................... 28 4.1 Introduction ......................................................................................... 28 4.2 Scenario A: Core Smart Metering System Functionality ......................... 29

4.2.1 Electricity Smart Meter Functionality .............................................. 30 4.2.2 Gas Smart Meter Functionality ....................................................... 30 4.2.3 Communications Layer Functionality .............................................. 31 4.2.4 IT Systems Functionality ................................................................ 32 4.2.5 Electricity Meter as Communications Hub for Gas Meter ................. 33

4.3 Scenario B: Additional functionality for IHDs ........................................ 34 4.3.1 One-way Communications to IHD or equivalent .............................. 34 4.3.2 Two-way Communications to/from IHD or equivalent ..................... 35

4.4 Scenario C: Additional functionality for smarter homes and smarter electricity networks .................................................................................... 37

5.0 Implementation Issues ............................................................................. 40 6.0 Industry, Market Arrangements and Governance ..................................... 42 7.0 Conclusions and Next Steps ..................................................................... 43

7.1 Summary ............................................................................................. 43 7.2 Next Steps ............................................................................................ 43

Appendix A – List of Substantive Questions ................................................... 44 Appendix B – CER Smart Metering Project Phase 1 ........................................ 50


6

Appendix C – EU Smart Metering Initiatives ................................................... 54 a. Guidelines of Good Practice .................................................................... 54 b. Mandate M/441 ..................................................................................... 54 c. Open meter project ................................................................................. 55 d. Task force on smart grids ..................................................................... 56

Appendix D – Smart Metering Status in EU Countries .................................... 57


7

1.0 Introduction

1.1 The Commission for Energy Regulation The Commission for Energy Regulation (‘the Commission’) is the independent body responsible for overseeing the regulation of Ireland's electricity and gas sectors. The Commission was initially established and granted regulatory powers over the electricity market under the Electricity Regulation Act, 1999. The enactment of the Gas (Interim) (Regulation) Act, 2002 expanded the Commission’s jurisdiction to include regulation of the natural gas market, while the Energy (Miscellaneous Provisions) Act 2006 granted the Commission powers to regulate electrical contractors with respect to safety, to regulate to natural gas undertakings involved in the transmission, distribution, storage, supply and shipping of gas and to regulate natural gas installers with respect to safety. The Electricity Regulation Amendment (SEM) Act 2007 outlined the Commission’s functions in relation to the Single Electricity Market (SEM) for the island of Ireland. This market is regulated by the Commission and the Northern Ireland Authority for Utility Regulation (NIAUR). The Commission is working to ensure that consumers benefit from regulation and the introduction of competition in the energy sector.

1.2 Purpose of this paper The purpose of this paper is to seek the view of the public and the CER’s stakeholders with regard to Possible National Rollout Scenarios for the Smart Metering Cost Benefit Analysis. In order to make an informed and impartial decision on this topic, the Commission wishes to obtain comments from members of the public, the energy industry, customers and all interested parties. The Commission commits to considering all views equally and affording each respondent the opportunity to clarify any issue raised in this paper. In particular, the purpose of the consultation is to get feedback on possible functional requirements for a smart metering rollout. The paper covers electricity and gas smart meters for residential and all non-profile metered business customers. The consultation will set out the strategic objectives for smart metering, many of the key issues/questions surrounding the functionality of a smart metering solution and will invite respondents to give their specific feedback. The paper also sets out a number of possible functionality scenarios and looks for feedback on these. These scenarios should not be read as proposed solutions, but are merely presented to help to draw out the issues associated with the implementation of smart metering.


8

This consultation paper is the first in a series of consultations that, in tandem with findings from the smart metering trials currently underway, will aim to bring more clarity to the myriad of issues surrounding a full smart metering implementation in order to inform the cost benefit analysis for smart metering in Ireland. This cost benefit analysis will ultimately deliver a robust economic assessment of all the long-term costs and benefits to the market and the individual consumer of a national smart metering rollout and will also indicate which smart metering functionality scenario is the most economically reasonable and cost-effective, and which timeframe is feasible for implementation.

1.3 Background Information

1.3.1 What is Smart Metering? “An intelligent metering system or ‘smart meter’ is an electronic device that can measure the consumption of energy, adding more information than a conventional meter, and can transmit data using a form of electronic communication. A key feature of a smart meter is the ability to provide bi-directional communication between the consumer and supplier/operator. It should also promote services that facilitate energy efficiency within the home. The move from old, isolated and static metering devices towards new smart/active devices is an important issue for competition in energy markets. The implementation of smart meters is an essential first step towards the implementation of smart grids.”1 There is currently no legal standard definition of the term “intelligent” or “smart” metering. However, it is important to note that ‘smart metering’ encompasses more than just the meter itself. Smart metering should be viewed as a system rather than a single device. It is essentially a hybrid technology consisting of three high level layers:

• Physical meters and associated devices • Communications layer covering data transport and communications

network management • IT systems which manage the data, applications and services

The following diagram illustrates the general structure of a smart metering system. Section 4 of this consultation paper will explore these smart metering system layers in greater detail. 1 Commission staff working paper - interpretative note on directive 2009/72/EC concerning common rules for the internal market in electricity and directive 2009/73/EC concerning common rules for the internal market in natural gas - retail markets - 22 January 2010 http://ec.europa.eu/energy/gas_electricity/interpretative_notes/doc/implementation_notes/2010_01_21_retail_markets.pdf


9

General structure of a smart metering system (Source: Figure 6, ERGEG Status Review of Regulatory Aspects of Smart Metering2)

Smart meters are the next generation of meters, which can replace existing electro-mechanical meters and offer a range of benefits for both the individual electricity and gas consumer and for the electricity and gas systems in general. The existing standard mechanical meter records the total amount of electricity/gas used over time. These meters are read manually and the information is sent to the network company and then used to calculate customer bills. If a meter reader does not have access to the customer’s meter, estimated consumption information (or a reading provided by the customer) is used to calculate the bill. If the estimated consumption is higher or lower than the actual meter read, this is corrected for when the meter is next read by the customer or the meter reader. A smart meter is much more sophisticated. It records customers’ actual use of electricity/gas over short intervals (e.g. every 30 minutes). These meters are connected by a communications system to the network company / meter data collector providing the operator with automated, up-to-date information on the amounts of electricity/gas used by customers. Access to this information provides opportunities to reduce network operation costs, including reduced costs of technicians visiting customer premises to manually read the meter and carrying out any necessary connections and disconnections. There are also savings due to reductions in technical losses and theft. The data collected from smart meters can be used by electricity and gas suppliers to deliver useful information to their customers regarding their electricity and gas consumption and costs. In particular, the installation of smart metering will allow electricity suppliers to create innovative pricing arrangements that can be offered to customers to support the efficient use of electricity, such as time-of-use electricity tariffs. This is where the price of electricity varies at different times

2 Ref: E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf


10

of the day to reflect the changes in the costs of producing electricity. This will allow customers to manage their consumption of electricity in line with price movements and demand patterns. Smart meters can facilitate improving energy efficiency by empowering consumers with more detailed, accurate and timely information regarding their energy consumption and costs, thus helping consumers reduce any unnecessary energy usage and shift any discretionary electricity usage away from peak consumption times.

1.3.2 EU Legislation There are a number of key EU legislative instruments driving smart metering, which include:

a. Third Legislative Package for Further Liberalisation of the Electricity

and Gas Markets 3

The Third Package contains provisions regarding intelligent metering systems, with the aim of better informing customers of their consumption and helping to increase awareness on energy consumption. According to the Third Package, Member States shall ensure implementation of smart metering systems, the purpose being to ensure active participation of customers in the electricity and gas supply market. The Third Package states that a roll out of intelligent metering systems could be made after an economic assessment has been made of the costs and benefits of their implementation. This assessment should be positive in order to form the basis of a decision of a roll-out. The general principle is that consumers must have access to their consumption data. National Regulatory Authorities (NRAs) must ensure access to customer consumption data, and the existence of a nationwide harmonised format for consumption data and a process for suppliers and consumers to access the data must be defined. Intelligent metering systems are promoted twice in the Directives: first, with the aim to promote energy efficiency and demand side management measures; second, with the aim to ensure active participation of consumers in the market. Different provisions apply for electricity and for gas – details below.

3 http://ec.europa.eu/energy/gas_electricity/third_legislative_package_en.htm


11

i. Electricity - Directive 2009/72/EC (Annex 1) 4 This directive states that:

1. (i) [Member States shall ensure that customers] are properly informed

of actual electricity consumption and costs frequently enough to enable them to regulate their electricity consumption’

2. ‘Member States shall ensure the implementation of intelligent metering systems that shall assist the active participation of consumers in the electricity supply market. The implementation of those metering systems may be subject to an economic assessment of all the long-term costs and benefits to the market and the individual consumer or which form of intelligent metering is economically reasonable and cost-effective and which timeframe is feasible for their distribution. Such assessment shall take place by 3 September 2012’. Subject to that assessment, Member States or any competent authority they designate shall prepare a timetable with a target of up to 10 years for the implementation of intelligent metering systems. Where roll-out of smart meters is assessed positively, at least 80 % of consumers shall be equipped with intelligent metering systems by 2020.

ii. Gas - Directive 2009/73/EC (Annex 1)5

This directive states that:

1. (i) [Member States shall ensure that customers] are properly informed

of actual gas consumption and costs frequently enough to enable them to regulate their own gas consumption.

2. Member States shall ensure the implementation of intelligent metering

systems that shall assist the active participation of consumers in the gas supply market. The implementation of those metering systems may be subject to an economic assessment of all the long-term costs and benefits to the market and the individual consumer or which form of intelligent metering is economically reasonable and cost-effective and which timeframe is feasible for their distribution.

4 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32009L0072:EN:NOT 5 http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32009L0073:EN:NOT


12

Such assessment shall take place by 3 September 2012.

Subject to that assessment, Member States or any competent authority they designate, shall prepare a timetable for the implementation of intelligent metering systems.

b. Directive 2006/32/EC - Energy End-use Efficiency and Energy Services

It has been estimated that EU energy consumption is around 20% higher than can be justified on economic grounds. This has led to the view that there is a large potential for unrealised economic energy savings which can be realised through energy services and other end-use efficiency measures. In pursuit of this objective the European Commission adopted EU Directive EC 2006/32 on 5th April 2006. Article 13 of this Directive requires that: “Member states shall ensure that, in so far as is technically possible, financially reasonable and proportionate in relation to the potential energy savings, final customers for electricity … are provided with competitively priced individual meters that accurately reflect the final customer’s actual energy consumption and that provide information on actual time of use” “Appropriate information shall be made available with the bill to provide final customers with a comprehensive account of energy costs. Billing on the basis of actual energy consumption shall be performed frequently enough to enable customers to regulate their own energy consumption”.

c. Directive 2005/32/EC – Security of Supply This Directive encourages “the adoption of real-time demand management technologies, such as advanced metering systems” to maintain ‘balance’ between demand and supply.

d. Directive 2004/22/EC - Measuring Instruments The Directive 2004/22/EC of the European Parliament and of the Council of 31 March 2004 on measuring instruments (MID) establishes the requirements that measurement devices and systems have to satisfy before being put on the market and/or put into use. Each measuring instrument must meet the essential requirements (laid down in Annex I of the directive) and in the relevant instrument-specific Annex.


13

1.3.3 EU Initiatives

There are currently a number of EU coordinated smart metering initiatives underway which include (further detail of these initiatives is included in Appendix C):

• Development and agreement of Guidelines for Good Practice on regulatory aspects of smart metering for electricity and gas. These guidelines are currently being drafted with the final version due to be agreed by end-2010.

• European Standards Organisations are progressing Mandate M/441 for the development of an open architecture for utility meters involving communication protocols and functionalities enabling interoperability,

• The Open Meter Project began in January 2009 with the main objective to specify a comprehensive set of open and public standards for advanced metering infrastructure (AMI), supporting electricity, gas, water and heat metering. This project is due to conclude in June 2011.

• In January 2010 a Task Force on Smart Grids was launched whose mission is to advice the Commission on policy and regulatory directions at European level and to coordinate the first steps towards the implementation of smart grids under the provision of the 3rd Package. The initial duration of the Task Force is 20 months, till May 2011.

1.3.4 Smart Metering Roll-out Status in Europe

The status of smart metering for electricity and gas in Europe is diverse, as outlined in the ERGEG Status review on regulatory aspects of smart metering report, published October 20096:

• In electricity only two countries have undertaken a large scale meter installation programme for customers - these early adopters are Italy and Sweden with a roll-out for 90% and 99% of customers, respectively. In addition, Finland, Greece, Spain, and Denmark are countries which have decided to undertake a large scale rollout of smart meters. Other countries are considering roll-out plans with some undertaking smart metering trials to inform their decisions.

• In gas, there are fewer uptakes of smart meters, only Italy has a

planned roll-out, while a small number of countries are discussing the possibility.

6 E09-RMF-17-03 ERGEG Status review on regulatory aspects of smart metering as of May 2009 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf


14

Since this ERGEG report has been published the British government has mandated a national roll-out of smart electricity and gas meters.7 The ERGEG Status review on regulatory aspects of smart metering report also found that the most important policy objectives for supporting and encouraging a roll-out of smart meters in both electricity and gas are energy efficiency, peak load management and more frequent meter readings. Refer to Appendix D which contains further detail from the ERGEG report on the smart metering roll-out status in Europe.

1.4 Structure of this paper This paper is structured in the following manner:

• Sections 2.0 to 5.0 will outline the detail of the substantive issues which the Commission is seeking your views on;

o The topic for discussion will be introduced briefly in each section

followed by details and proposals as appropriate; o Each section includes questions. To aid regulatory transparency and

assist in the delivery of an efficient consultative and decision making process, the Commission asks respondents to address these questions directly in their responses;

• Section 6.0 clarifies Industry, Market Arrangements and Governance for

the Smart Metering Project;

• Section 7.0 contains an overall summary of issues outlined in this paper and outlines the next steps in the consultation process;

Appendix A contains a summary list of all of the questions which the Commission has asked in this consultation paper. This is designed to be a useful aid to respondents when preparing their submissions and can also serve as a “short-cut” for respondents who may not have the resources to devote to preparing a full submission. If taking the “short-cut” option, respondents should answer questions in the space provided in Appendix A. Appendix A will also be published separately in Word format. Responses which have availed of the 7 http://www.decc.gov.uk/en/content/cms/what_we_do/consumers/smart_meters/smart_meters.aspx


15

short consultation option will be evaluated equally by the Commission, when making its decision. Appendix B contains an overview of the CER Smart Metering Project including a brief progress update. Appendix C contains an overview of a number of EU coordinated smart metering initiatives currently underway. Appendix D contains a summary of smart metering roll-out status in EU countries as derived from an ERGEG survey of national regulatory authorities.

1.5 Responding to this paper Interested parties are invited to comment on the questions raised in this consultation paper by close of business on Friday 23rd July 2010. Please note that, as the majority of questions posed in this consultation address both electricity and gas smart metering issues, respondents should make it explicit in their responses if their comments are applicable to electricity, gas or both. As responses will be published in full on the CER website, respondents should include any confidential information in a separate Annex, stating the rationale for not publishing this part of their comments. Submissions on this paper should be forwarded, preferably in electronic format, to:

Gary Martin Commission for Energy Regulation, The Exchange, Belgard Square North, Tallaght, Dublin 24. E-mail: [email protected]


16

2.0 National Smart Metering Programme – Objectives and Status

2.1 Introduction This section outlines the objectives of the National Smart Metering Programme in Ireland and invites comments on these stated objectives. It then gives an update on progress to date in Ireland regarding smart metering and focuses in particular on the status of Phase 1 of the CER Smart Metering Project.

2.2 Objectives of the National Smart Metering Programme The National Smart Metering Programme in Ireland has the following strategic objectives: Energy Efficiency • Encourage end-use energy efficiency via enhanced information and pricing

signals, resulting in reductions in overall energy usage and thus reduced emissions of carbon dioxide (CO2), nitrogen oxides (NOx) and sulphur oxides (SOx) as a measure to combat climate change and reduce pollution.

Peak Load Management

• Reduce demand for peak power, with consequential electricity generation savings and improved security of supply. This can be achieved via pricing signals such as Time of Use tariffs, where the price of electricity varies at different times of the day to reflect the changes in the costs of producing electricity.

Support Renewable and Micro Generation • Assist in achieving of Irelands stated national targets for renewable

generation (40% by 2020) by facilitating demand response solutions that will complement increasing levels of intermittent wind generation on the electricity system.

• Facilitate the wider take up of micro generation (via export measurement function of smart meters).

Enhanced Competition and Improved Consumer Experience

• Promote competition in the electricity retail market by enabling electricity suppliers to create innovative pricing arrangements that can be offered to consumers to support the efficient use of electricity, such as Time of Use electricity tariffs.

• More accurate billing of customers with the elimination of estimated billing.


17

• Support more timely and efficient switching by customers. • Support more flexible and diverse service offerings to consumers from

suppliers including potential for expanding prepayment offerings. • Empower consumers to make better decisions regarding their energy use

by providing them with accurate, detailed and more frequent information on their energy consumption and costs.

• Improve change of supplier process through auditable timely final meter reading.

Improved Network Services • Improve services to customers in areas such as power quality, fault

monitoring and meter reading. • Prevent theft and measure losses more accurately. • Become a key component of a 21st century smart electricity network for

Ireland. • Provide a potential platform to support national targets on Electric Vehicles • Improved load forecasting and network planning, possibly leading to

deferment of infrastructure expansion costs. Question 1 – Respondents are invited to submit their comments on these stated objectives of the National Smart Metering Programme. In particular, do you agree with the objectives outlined for the Irish National Smart Meter Programme? Have you any other suggested objectives? If so give details.

2.3 Smart Metering Progress in Ireland

2.3.1 Government Policy and Legislation The National Smart Metering Plan is a commitment in the Government's Energy Policy Framework and in the 2007 Programme for Government. It is a central component of the strategy to radically enhance management of energy demand and to deliver greater energy efficiency. Smart metering is believed to be one method which encourages the self regulation of energy consumption. This method is supported by the government who has stated in their Programme for Government 20078: “Ensure that the ESB installs a new smart electronic meter in every home in the country which will allow people to reduce their bills by cutting back on unnecessary use of electricity” ; 8 Programme for Government 2007 (Environmental Sustainability section, page 10) http://www.foe.ie/download/pdf/2007_programme_for_government_final.pdf


18

“Facilitate the introduction of net metering to allow consumers to sell electricity back into the grid from any renewable power supplies they have.” This commitment was reiterated in the Government’s framework for sustainable economic renewal, Building the Smart Economy, published in December 2008.9 On 8th May 2009, the Government adopted the National Energy Efficiency Action Plan 2009-2020 (NEEAP)10 in order to achieve Ireland’s energy efficiency targets. One of the principal measures contained within this Action Plan, which represent the key targets for Government to achieve to meet our 2020 commitments, is Action 33: “We will encourage more energy-efficient behaviour by householders through the introduction of smart meters.” On 22nd December 2009, the Energy Services Directive (Directive 2006/32/EC) was transposed into Irish law under the European Communities (Energy End Use Efficiency and Energy Services) Regulations 2009, Statutory Instrument No. 542 of 200911. These Regulations also amend the Electricity Regulation Act 1999 to allow the Commission for Energy Regulation to place requirements on energy undertakings in relation to informative billing. . “(5) The Commission may, by direction under subsection (1), require an energy undertaking to do any or all of the following— (a) provide bills to its final customers, based on actual energy use, at such frequency as may be specified by the Commission to enable those customers to regulate their own energy consumption in a timely manner,...”

2.3.2 CER Smart Metering Project Phase 1 The Commission established the Smart Metering Project Phase 1 in late 2007 with the objective of setting up and running Smart Metering Trials and assessing their costs and benefits, which will inform decisions relating to the full rollout of an optimally designed universal National Smart Metering Plan. Overall, progress is very positive with all key milestones having been achieved. The main highlights to date have been the:

9 Action Area 3: Enhancing the Environment and Securing Energy Supplies, Page 18 http://www.taoiseach.gov.ie/BuildingIrelandsSmartEconomy_1_.pdf 10 Chapter 07 – Residential Sector, Page 79 http://www.dcenr.gov.ie/Energy/Energy+Efficiency+and+Affordability+Division/National+Energy+Efficiency+Action+Plan.htm 11 http://www.attorneygeneral.ie/esi/2009/B27331.pdf


19

• Initiation of the electricity customer behaviour trials (CBT) for residential and SME customers – due to complete end-2010.

• Initiation of the technology trials – due to complete Q3 2010. • Initiation of the gas customer behaviour trials (CBT) for residential

customers – due to complete mid-2011.

Summary Progress Update for Smart Metering Project Phase 1

Electricity CBT

•Recruitment & meter installation (c.6,500) completed•Benchmark data period completed 31 Dec 2009•Test period in progress: ToU tariffs, Billing, IHD, Web

Gas CBT •Recruitment & meter installation (c.2,000) completed•Benchmark data period completed 31 May 2010•Test period in progress: Billing, IHD, Variable Tariff

Technology Trials

•PLC & RF 2.4GHz trials in progress (c.4,000 meters)•RF 868MHz study planned•Gas trials being scoped & planned (c.150 meters)

Prepay •“Proof of Concept” Trial in progress (c.60 meters)Micro Gen •Data collection and analysis for CBA under way.Cost Benefit Analysis

•Scoped & planned with ESRI.•Preparatory work in progress for Interim CBA.

Further information on the Smart Metering Project Phase 1 is contained in Appendix B.


20

3.0 Ownership, Display and Provision of Information

3.1 Introduction Smart metering will deliver a step change in relation to the amount, quality and timeliness of customer’s energy (electricity and natural gas) consumption information. Indeed it is these characteristics that are driving the desire to implement smart metering. Data should help customers modify their behaviour; it should also facilitate the customer in shopping around for the best deal from energy suppliers. Currently when energy network companies collect the bimonthly register readings of domestic customers, they push this data through their market systems to energy suppliers. The supplier in turn provides this data to the customers. Smart Metering will lead to a massive increase in the amount of data that is collected, from 6 register values per year to potentially 48 interval values per day or 17,520 reads per year per customer. The network company / meter data collector will collect and store all this data on their Meter Data Management System (MDMS) component of the smart metering system and make it available to suppliers. This increase in data available leaves a number of key questions that need to be addressed, and these will be dealt with in this section, they include;

• Granularity of data requirement • Access to data for Suppliers • Access to data for Customers • Data required for billing • Data required for prepayments • In Home data requirements:

o Data flows required for web service in the home o One way data flows to an IHD o Two way data flows to an IHD o Data flows required for smarter homes and smart grids

• Data ownership and security • Vulnerable Customers

3.2 Granularity of customer data The data collected from meters is owned by the Customer and it is assumed that the smart metering solution must provide access to this data for the Customer. Similarly, the Supplier requires access to the Customers data for billing and marketing analysis purposes.


21

All data will be stored in the meter for an agreed minimum number of days. The data will be collected daily by the smart meter systems and stored on the network company’s / meter data collector’s central repository for data. This system will hold data for analysis, long term storage and forwarding on to authorised stakeholders. While the meter can capture the information in real time one of the issues that have to be addressed is what service and performance level is required from the smart metering infrastructure. For example just because the meter can capture daily profile data should all of this data be made available to Suppliers and customers every day following a nightly poll and at what service level. Smart meters will have the ability to capture both register data and profile data. The profile data would typically be based on half hourly intervals.

3.3 Access to data for Suppliers This raises a number of questions for Suppliers in relation to the type of data and the access to data they require. For example do Suppliers want access to half hourly interval data for all their customers or would daily, monthly or bimonthly register reads suffice. Suppliers could decide that ad hoc access to the interval data for all or a selection of their customers would suffice as this would enable Suppliers to analyse the data and for example develop usage profiles for categories of customer. Another issue for Suppliers is how they get their customer data. The data could be pushed on a daily, weekly, monthly frequency to the supplier systems from the network company / meter data collector or alternatively if the network company / meter data collector were to set up a data portal the suppliers could pull down the data as and when required. It is likely that the Commission will mandate that electricity suppliers offer Time of Use (ToU) tariffs to their customers and this would also have a bearing on the data required by suppliers. The findings of electricity customer behaviour trials, in which ToU tariffs are currently being trialled, will inform any such decision. In considering these questions suppliers would need to take into account a number of factors including;

• Likely products they may offer e.g. Time of Use tariffs, block tariffs • Impact on their billing systems • Impact on their interface to the market messaging system • Customer billing requirements • Data required for prepayments. • Web based information they may offer customers


22

Question 2 – Respondents are invited to submit their views on the granularity of data that should be available from smart metering systems and how this data should be made available to energy suppliers. In particular: • What granularity of data do suppliers require to carry out their business:

interval reads, daily reads, monthly reads? • Do suppliers have a view on whether data is pushed to them at defined

frequencies or would they prefer to pull/access data from a web portal as required?

• How frequently do suppliers want to access data? • What service levels are required around the various information sets that are

required by the suppliers? • Do suppliers want to hold all historical data on their customers or are they

happy to access historical data from a centralized portal?

3.4 Access to data for Customers The EU Third Package Directives (referred to in Section 1) require that the customer should have access to the information in relation to their historical consumption data in a national harmonized format, free of charge. Customers will have the right to provide their consumption data to other suppliers in order to get an alternative quote for their supply. There a number of options for making this data available to customers - suppliers could provide this information to customers or it could be supplied by the network company / meter data collector. Potentially the network company / meter data collector could provide access to the customer via a web portal assuming the correct authorization was put in place. Question 3 – Respondents are invited to submit their views on how smart metering data should be made accessible to energy customers. In particular: • What information set should Customers be provided with? • Should suppliers provide data directly to their customers or would it be

preferable that the data is accessible from a web portal provided by the meter data collector? Or are there any other options that should be considered?


23

3.5 Information on Bills and Frequency As outlined earlier in Section 1.3.2 The Third Package Directives and the Energy End User Efficiency Directive specify that customers are properly informed of actual electricity consumption and costs frequently enough to enable them to regulate their electricity consumption. The EU Retail Markets Interpretative Note of the Third Package Directives published 22 January 2010 clarifies what is meant by “frequently enough”: “The Commission's services consider that receiving information on a monthly basis would be sufficient to allow a consumer to regulate his consumption.”12 It should be noted the bills need not necessarily be paper based. The bills will also be required to give a comprehensive account of the customer’s energy usage. This is likely to include a comparison of the customer’s consumption with the equivalent period in the previous year, and a comparison with the consumption of their peer group. These comparisons should be provided in graphical format where practicable. It is hoped that the findings of the electricity and gas customer behaviour trials, in which more detailed and more frequent billing options are currently being trialled, will help the Commission to define the requirements in this area. Question 4 – Respondents are invited to submit their views on the required frequency and detail of billing. In particular: - Do you have a view on the likely requirement for monthly billing of customers? - Do you have a view on the type of information relating to energy usage that should be contained on bills? - Also, for the purposes of such informative billing what granularity of data are the suppliers likely to require?

3.6 Data required for Prepayments One of the potential benefits of smart metering is the ability to define the smart meter as a debit or a credit meter through the backend software. This would make the prepayment option for customers much more easily available as there would be no need to replace the meter with a specific prepayment meter. We are

12 12 Commission staff working paper - interpretative note on directive 2009/72/EC concerning common rules for the internal market in electricity and directive 2009/73/EC concerning common rules for the internal market in natural gas - retail markets - 22 January 2010 http://ec.europa.eu/energy/gas_electricity/interpretative_notes/doc/implementation_notes/2010_01_21_retail_markets.pdf


24

calling this the “thin prepayment” solution and we are currently testing this option in the smart metering trials. For the solution to work there must be no need for the customer to interface with the meter to either check their credit balance or to update their meter with credit. This means that all the prepayment functionality is in the supplier backend systems. This will require that up to date meter readings are available to an agreed service level. This service level has an impact on the design of the smart metering solution. An example of a service level could be “90% of readings the following day with the balance within 2 days”. Question 5 – Respondents are invited to comment on the viability of the “Thin Prepayment” solution. In particular: • The availability of meter reading data to agreed service levels is important for

the operation of a “thin meter” prepayment solution. What service level do suppliers require for the thin prepayment solution?

• Do Suppliers believe that the “thin Prepayment” solution is workable? Specifically do Suppliers believe they will be able to provide sufficient access to credit balances to Customers without any display on the meter?

• Do Suppliers think that an occasional loss of the communications channels to the prepayment meter will cause difficulty?

• How do respondents feel customers should be kept up to date on their balances? For example, do respondents see the provision of an In Home Display (IHD) as an essential part of a thin prepayment” solution?

3.7 In Home Data The smart metering system has the capacity to potentially provide real time information into the home from the meter. Over time there could be a large number of applications in the home that require this information including In-Home-Displays (IHDs), Load control devices, energy management systems and perhaps electric vehicle charging systems. The technical and functional issues around the IHD will be discussed later in the document. Options for generation of data include:

• Broadcasting of real time consumption data (kWh) and some near real time historical data from the meter via an embedded or external communications device,

• The use of a customer fitted clip-on CT (current transformer) with communications to give approximate real time values,

• Availability on line on the following day of daily profile data.


25

A key issue is whether an IHD should be a mandatory requirement. Most implementations to date have not mandated the requirement for an IHD or even for the meter to be able have the ability to communicate with an IHD. However, recent proposals for full roll outs are either recommending that all meters should be enabled to communicate with an IHD, leaving the choice to have the IHD to either customers or Suppliers e.g. The Netherlands, or that an IHD should be provided for every customer e.g. proposed British roll out. An important objective of the electricity and gas customer behaviour trials we are running is to give feedback on the effectiveness of the IHD which will provide a very good basis for the Commission to make a decision on this matter. If an IHD is seen as being effective, the question of whether the supplier, the network company or the customer is responsible for its provision and its ongoing maintenance will have to be addressed. In the event of an IHD featuring in a full roll out a minimum functionality will have to be defined. This functionality could include: Real time consumption data and historical consumption data from the meter which will be converted into pricing information on the IHD. Other issues to be addressed include impact of change of supplier process and branding of the IHD. In the event of a gas smart metering roll out with an associated IHD another issue is should the same display serve for both electricity and gas. Apart from an IHD, one of the options available to suppliers is to use the web as the communication channel in the home. This has the advantage that it is a well understood technology and it offers a lot of flexibility in the management and display of information for the customer. Indeed some independent companies are offering this interface to customers for example Google ‘power meter’. The downside is that as yet broadband is not available in all homes and for those without a PC some form of internet enabled device would be required. Question 6 – Respondents are invited to submit their views on how smart metering data can be made available dynamically in the home. In particular: • Do respondents feel that internet enabled technology could meet customer

requirement for consumption information or will it be inadequate? • Do respondents view the In Home Display (IHD) as an essential feature of

their future product offerings? • If an IHD is a requirement which of the following should be responsible for

providing and maintaining the IHD and what are the reasons for your preference: The Customer; The Supplier; or Network company?

• Do suppliers intend to offer products in the market that would feature load management or demand response by the customer?


26

• What in your view is the high level minimum functionality for an IHD?

3.8 Data Ownership and Security Increased data flows are at the heart of every smart metering programme. Data transferred from smart meters may include meter readings, consumption data and event logs. The introduction of smart metering will not only change the nature of the data generated, but will dramatically increase its volume, utility and commercial value. The challenge for suppliers and Network companies / meter data collectors in due course will be to demonstrate to consumers and regulators that they can and will process that data securely and lawfully. Risks to the communications network include the hacking of customer details, denial of service attacks and even infiltration by persons seeking to disrupt supplies. Security also needs to be an integral consideration in the design of the meters themselves, the networks within which they operate and the data centres in which the data is stored. Currently, data protection and privacy regulation in Ireland is principally implemented through the Data Protection Act 1998 and the Data Protection Amendment Act, 2003, which updated the legislation, implementing the provisions of EU Directive 95/46. The Acts set out the general principle that individuals should be in a position to control how data relating to them is used. Member States should have due regard to the confidentiality of customer information as provided for in Article 16 of the Treaty on the Functioning of the European Union.13 The generation and transfer by smart meters of large volumes of individual consumer-related data will require suppliers and network operators / meter data collectors to reconsider carefully basic issues such as why data is collected, how long it should be stored, how it will be protected, how (and by whom) it will be accessed and processed and whether all appropriate consents have been obtained. Question 7 – Respondents are invited to submit any comments or views on the issue of data ownership or data security relating to smart metering.

13 The Treaty on the Functioning of the European Union, article 16, European Union 9.5 2008


27

3.9 Vulnerable Customers Specific considerations may need to be taken into account to ensure that all customers, regardless of physical or mental ability, have the opportunity to reap the benefits of receiving enhanced information on their energy consumption and costs that smart metering can provide. The specific needs of vulnerable groups of customers, such as the disabled, partially sighted or blind, will need to be taken into account when addressing requirements relating to the provision of smart metering energy data to customers via detailed billing, Web and In-Home Displays. Also, the “thin prepayment” solution enabled by smart metering (as outlined in section 3.6 above) will need to take account of specific requirements for such vulnerable customers. In addition to catering for physical access needs of certain vulnerable customers there may be additional considerations to be taken into account of any potential negative side effects of the impact of giving certain vulnerable customers enhanced and more frequent information on their energy usage and costs (e.g. could those experiencing financial hardship or on low incomes, especially the elderly, be prompted to use less energy to the detriment of their health). Also the “thin prepayment” solution will have to be cognisant of any specific requirements relating to such vulnerable low income or financial hardship customers especially in terms of how they access their credit balance information. Finally, the impact on vulnerable customers of the innovative pricing arrangements, such as time of use tariffs, that smart metering facilitates will need to be better understood. It is hoped that the findings of the electricity and gas customer behaviour trials, in which time of use electricity and variable gas tariffs are currently being trialled, will help the Commission to define the requirements in this area. Question 8 – Respondents are invited to submit any comments or views on whether specific data provision and accessibility requirements for vulnerable customers need to be considered as part of a smart metering solution? If so, give details.


28

4.0 Smart Metering System Functionality Scenarios

4.1 Introduction

Smart metering systems are complex systems composed of meters, communications and IT systems. Smart metering is and evolving an immature technology. From an EU perspective there is not yet a standard definition for the functionality of smart metering. In the absence of such it is up to each country to define its own functionality. In trying to come to a decision on the functionality of smart metering we should look to build a system which will meet as many of the key strategic objectives of smart metering, while taking into account costs, technology challenges and risks

In deciding on a full roll out of smart metering the first issue is to agree what functionality the systems should have. The design of the systems will also be dependent on the service and performance levels required. These will have a particular impact on the sizing and choice of the telecommunications infrastructure. It is important from a governance perspective to ensure that the functionality of the system being rolled out reflects that which was considered in the Cost Benefit Analysis.

This section will describe the functionalities at a high level. At some stage in the process detailed workshops will be required with the key stakeholders to flesh out the range of issues arising. Additional functionality in the smart meter will add to the cost and complexity of implementation. It will be important that costs associated with such additions are matched with commensurate benefits. We have a number of scenarios to consider in terms of functionality and associated smart metering systems. These scenarios should not be read as proposed solutions. The scenarios are merely presented to help to draw out the issues associated with the implementation of smart metering.

A. Core smart metering system functionality, supporting remote meter reading, multiple supplier tariffs, profile data and remote operation.

B. Additional functionality to provide real time communications (one-way and

two-way) between an in-home display (IHD), or equivalent device, and smart metering systems.

C. Additional functionality in the smart metering system to support the

concepts of smarter homes and smarter electricity networks


29

4.2 Scenario A: Core Smart Metering System Functionality The functionality outlined here should deliver the core benefits of smart metering and meet all the requirements in the EU directives outlined in Section 1.3.2. The following are benefits which could be delivered by a smart metering implementation including such functionality:

• The capturing of time based electricity consumption information to allow

electricity suppliers offer time of use tariffs to customers to encourage demand shifting

• The capturing of profile data to provide customers with better energy consumption information and allow greater flexibility to energy suppliers in relation to tariffs

• Provision to customer of consumption data to enable them to better shop around for energy suppliers

• Measurement of export to the electricity network from customer sites with micro-generation

• An end to estimated meter readings • Substantial reduction in energy theft through tamper proof meter • Support more flexibility in payment options offered by energy suppliers – in

particular enable transition between pre-payment and credit payment customer status

• Provide quality information to help improve service to customers. • Utilise the information from the smart meter as part of a smarter electricity

network. • Facilitate web based services to customers

E

Mid

dlew

are

/ Hub

CustomerPortal

SupplierPortal

E = Electricity Meter, G = Gas Meter,M ic.Gen = Micr o Gen.HAN = Home Area Network

G

Mic.Gen

Wide Area Communications Network

Me ter Data Storage and mana gement Market Messages

Gas Industry

HANHAN


30

The smart metering system to deliver these requirements will likely feature the components outlined in the preceding diagram and described below:

4.2.1 Electricity Smart Meter Functionality The electricity smart meter could have the following functionality:

1. Half-hourly profile data 2. Limited Range of Standard ToU register readings – A time of use register

can record consumption of electricity in different time blocks (e.g. daytime 8am – 11pm) associated with different prices

3. Import and export data to facilitate measurement of export data. 4. Watt-less energy measured 5. Events such as power outages recordable on the meter 6. Alerts can be recorded on the meter, for example if there are attempts to

remove the meter cover or tamper with the meter 7. Voltage / Power quality monitoring available as required 8. Remotely operable embedded switch for de/re-energisation (single phase

meters only) 9. Controllable physical circuit for loads such as night storage heating 10. Load limiting capability 11. Firmware upgradeable 12. Strong Encryption 13. Storage of data on meter for agreed period of time 14. Life of meter typically 20 years 15. In the case of three phase customers an embedded remotely operable

switch will have to be evaluated

4.2.2 Gas Smart Meter Functionality The gas smart meter could have the following functionality:

• Gas meter output functionality may include:

1. Volume usage data to support remote reading and provision of data to ancillary devices in the home, to be provided at defined frequencies (e.g. half hourly, hourly, 4 hourly, Daily, Monthly);

a. Volume index reads (m³) b. Temperature sensor readings c. Temperature compensated volume index readings (m³) d. Date and Time stamp


31

2. Other data that may be required to support advanced tariff and payment systems as well as meter equipment servicing;

a. Open/closed valve status b. Meter serial number or other identifier c. Alarm/Event codes d. Battery warning flag/code e. Valve usage counter

• Gas meter input functionality may include: 1. Remote disconnection instruction (valve closure) 2. Remote reconnection enablement instruction (health and safety

validation checks required to allow customer to self re-connect / open valve)

3. Calorific Value where required (can be used by in-home ancillary equipment or IHD for the conversion of volume output data from the meter into energy values - kWh)

4. Clock synchronisation (for the gas meter and communications modules)

5. Time of Use block settings (can be used by in-home ancillary equipment or IHD if required for advanced tariff and payment systems)

6. Firmware upgrades (to meter and communications modules) 7. Tariff prices (can be used by in-home ancillary equipment or IHD if

required for advanced tariff and payment systems) 8. Text block for display on meter display, ancillary equipment or IHD 9. Encryption key changes for secure data communication

4.2.3 Communications Layer Functionality The communications layer of the smart metering system could have the following functionality:

• Facilitate two-way communication with the backend smart metering infrastructure.

• Facilitate the collection of both on-demand (real time) and cyclical data (e.g. each day) from the meter

• Facilitate remote operation of the meter to de-energise and re-energise the customer (subject to safety arrangements).

• Facilitate remote re-configuration and upgrades of meter The communications layer is the area where a considerable number of challenges lie, and as a result this is a key focus of the technology trials currently underway. ESB Networks is currently conducting trials that incorporate the various communications technologies including GPRS, PLC (Power Line Carrier) and RF (Radio Frequency - wireless). In addition BG Networks is working with


32

ESB Networks to trial the option of the electricity smart meter acting as the hub for communications to and from the gas smart meter – further details of this option are outlined below in section 4.2.5 (Electricity Meter as Communications Hub for Gas Meter). While the final business and functional requirements will drive the choice of communications solution, these technology trials will offer key learning and risk mitigation opportunities which will help inform what the best fit smart metering communications solution is for Ireland. This consultation paper does not further examine or consult on the communications infrastructure that should underpin a national smart metering infrastructure. This will be dealt with in a subsequent consultation paper after findings from the technology trials are available. It is also recognised that there are various models for providing and managing the communications layer including the following:

• ESB Networks and BG Networks provide separate infrastructures for electricity and gas respectively,

• ESB Networks provide a common infrastructure that facilitates both electricity and gas communications,

• Third Party provides a common infrastructure for either or both electricity and gas communications.

However this will also be examined in detail and respondents views sought in a subsequent consultation after findings from the technology trials are available. Ultimately the guiding principle will be to ensure that the most cost effective communications solution is put in place.

4.2.4 IT Systems Functionality The IT Systems to manage smart metering will consist of systems to manage the meters and communications infrastructure including:

• A local Data collector or concentrator • A Head End System(s) to manage the communications infrastructure • A Meter Data Management System that the MDMS system will interface

with all other systems via a Middleware Hub or Enterprise Service Bus solution.

Question 9 – Respondents are invited to comment on the core smart metering functionality as outlined above. In particular: • Do you agree with this core functionality? Are there any functions you feel

should not be in the core scenario or are there any functions missing?


33

• How many or what flexibility is required in relation to the number of Time of Use (ToU) registers on the electricity meter?

• Apart from the current meter reading is there any requirement to display further information on the meter? Please bear in mind that meters are not easily accessible to all customers.

4.2.5 Electricity Meter as Communications Hub for Gas Meter The electricity meter could act as a hub for a gas meter, facilitating the exchange of data to and from the gas meter. A separate hub solution for Gas is also an option – however, it should be noted that currently less than a third of homes nationally have a gas meter. While dual fuel would not be the norm for smart metering roll outs to date there is increasing interest in using the electricity smart metering infrastructure to support gas meters. The data from the gas meter could be collected by ESB Networks and then passed onto BG Networks as a service. To support this concept the following extra functionality is needed:

• Means of integrating gas meter into the electricity smart metering system • Collect agreed data from the gas meter • Support remote operation of valve • Electricity meter to provide storage of historical information from gas

meter. • If required electricity meter should facilitate transfer of data from gas meter

to in home display • If required, periodic updating of CV’s for the IHD

It the electricity meter were to support communications to the gas meter, the gas meters communications module would wake up periodically and send the data to the electricity meter. The gas meter would also synchronise its clock with the electricity meter during this conversation and accept information which the electricity meter passed to it (e.g. firmware upgrade, configuration change, request to open/close valve etc). Additional data storage and protocols support will be required on the electricity meter. From a cost and complexity perspective, it is preferable that the electricity meter support only one wireless solution into the home. The communications solutions must provide sufficient capacity to carry the additional data. The IT Systems themselves must provide a mechanism for separating out the gas data from the electricity data.


34

While this section refers to using the smart metering infrastructure to support gas metering it is also possible that the smart metering infrastructure could be used to support data collection from water meters. Question 10 – Respondents are invited to submit their views on the whether you think that leveraging the communications module in the electricity meter as a hub for Gas metering is a good idea or would you rather see a separate communications hub in the home to support gas metering?

4.3 Scenario B: Additional functionality for IHDs Additional functionality could be added to the core functionality outlined in Scenario A above to provide real time communications (one-way and two-way) between an in-home display (IHD), or equivalent device, and smart metering systems.

4.3.1 One-way Communications to IHD or equivalent There are a number of ways real time information could be provided to the customer either in terms of how the data is generated and also how the data is received and displayed in the home. This option focuses on the delivery of real time data from the meter into the home. The communications protocol selected will need to provide a level of future proofing for devices or applications as yet unknown that may be developed for the home. As yet no dominant protocol has come to the fore in the HAN and the choice of the HAN protocol represents a major risk for the project. The meter will need to have the ability to send data to an in home display. The in home display will have to receive the data. The following are the elements of the solution:

• A standard external physical interface on the meter such as USB or rj11 port to enable an external wireless dongle to be plugged in (these concepts are features of both proposed smart metering implementations in both The Netherlands and France); or an embedded communications modem in the meter which will communicate with an In Home Display or equivalent device.


35

• Communications from the meter is likely to be based on a suitable wireless protocol. There are a number of wireless protocols which potentially could be used for this purpose – a selection has yet to be made, although all of them have issues.

• The system will have to support security and authentication to ensure both

the confidentiality of customer’s data and the integrity of the system With a one-way communication from the smart meter to an IHD or other devices in the home, the network company / meter data collector would provide a table of information to be broadcast from the meter on the HAN and it would be up to the devices in the home to utilize the information from that table. The design of the systems must allow flexibility in the provisioning of the in home display or equivalent. Assuming there are no prices on the meter to be broadcast, (i.e. the meter will broadcast kWh readings) then actual prices will be set in the IHD by the customer or by the electricity supplier.

4.3.2 Two-way Communications to/from IHD or equivalent Another issue is whether the smart meter should have a one way or two way communication with the home. Two way communications with devices in the home is very much at the leading edge of smart metering functionality in the home. The requirement for two way

M

IHD

Home

Mid

dlew

are

/ Hub

CustomerPortal

Supplier Portal

MarketMessages

LANLAN WANWANC H MD

AMI Data CollectionInfrastructure

M = Meter, C = Data Collector, H = Head End System, MD = MDMS

IHD Registration and Authentication


36

communication with the smart meter would be targeted at demand shifting or load reduction. There could be a requirement for a load management device in the home to proactively interface with the smart meter. In considering requirements for two way communication we will have to balance the costs and the technology risks against the benefits, and also estimate the number of customers likely to invest in such technology for their homes. One potential application of two way communications functionality is to facilitate a “Thin Prepayment” system (refer to section 3.6). Currently, as part of the Smart Metering Trials, we are testing the concept of such a prepayment solution which would mean that the same smart meter can be used for all customers, prepay and credit. The core functionality as outlined in Section 4.2 would apply. However, apart from sending real time information from the meter into the home to enable customers better manage their electricity consumption, there may be other business requirements for an in-home display or equivalent to support prepayment. The meter will communicate with an IHD or equivalent device in an active two way manner and could include data from beyond the smart meter. In particular, the issue of keeping the customer informed within a reasonable period of time of the balance they have in their account or the need to top up their bill would have to be addressed. Other issues that may arise in prepay include the process to re-energise a meter following payment by a previously de-energised customer. Please note that the previous section on data (Section 3) also covers some of the issues in relation to the IHD (section 3.7) and in relation to the “Thin Prepayment” solution (section 3.6). Question 11 – Respondents are invited to give their views on the additional functionality scenario B outlined above. In particular: • Is one way communication between the Meter and the IHD sufficient? If not

what are the additional requirements that would drive two way communications?

• What are respondents’ views on the issue of the communications protocols to be used in the home?

• What data should be provided to an In Home Display or equivalent from the meter?

Question 12 – Respondents are invited to give their views on the additional functionality scenario outlined in section 4.3.2 above. In particular is their any additional functionality required to support the “thin prepayment” solution?


37

4.4 Scenario C: Additional functionality for smarter homes and smarter electricity networks This is very much at the leading edge of smart metering functionality. There are a number of areas worth considering. These areas would be primarily aimed at promotion of demand shifting and load reduction. Given the government targets on renewable energy at a macro level the ability of the Home Area Network (HAN) to offer some demand management capabilities to maximize absorption of wind generation must be considered. As stated earlier, work at an EU level is now ongoing in relation to smart grids. Smart grids are seen as a key to the large scale integration of renewable energy sources in the power systems both at a macro and micro level. In particular they would be necessary for the integration of distributed generation, renewable energy sources and electric vehicles. The addition of the communications infrastructure to support smart meters will create a major difference in the way the electricity network looks. While smart meters are not sufficient in themselves, a robust communications infrastructure delivered as part of a smart metering roll out combined with a high functionality HAN would support smart grids In considering this area of enhanced requirements we will have to balance the costs, benefits, how many customers would actually use the functionality and if alternative channels to the smart metering infrastructure could deliver the requirements. Over time some customers may choose to install home energy management systems and/or smart appliances, these systems could interface with the HAN in relation to pricing information. Possible further requirements to support demand response are:

• Support broadcasting of pricing information to an energy management system

• Support demand response in the home (e.g. Critical Peak Pricing events and Demand Response events)

• Support Load Control in the home (e.g. storage heating control). The Government aims to have 10% of the transport fleet fully electric by the year 2020. Electric Vehicles (EVs) are seen as a key in the de-carbonisation of transport and through their ability to be charged particularly at night they can also help maximize the use of wind energy. Based on current numbers, this equates to approximately 230,000 EVs. In addition ESB believes that about 80% of all Irish homes have the physical space in terms of driveways etc to allow for home charging.


38

As EVs are new technology the requirements to support this scale of EVs is not yet known. ESB Networks is working on a number of different national and international projects to help it better understand these requirements, however this will take some time. At this stage however we need to flag possible extra smart metering requirements in a home where EV charging may occur. These could include AMI (advanced metering infrastructure) / HAN capable of exchanging information with EV in home to control EV charging, separate and/or special metering requirements for EVs

All the additional capabilities in the home require:

• A fully fledged two way HAN protocol is deployed on the electricity meter and that the IHD and all other devices adhere to that protocol.

• All devices joining the HAN must be authorised and fully authenticated • The more demanding messaging and control signal requirements mean

that the AMI communications infrastructure and the interfaces built between systems must operate with real-time speed.

• To perform Load Control, the AMI systems must maintain current device status information

• Authorisation may be required for control of Electric Vehicle charging The diagram below summarises the design for full HAN functionality.

E

Mid

dlew

are

/ Hub

CustomerPortal

SupplierPortal

E = Electricity Meter, G = Gas Meter,Mic.Gen = Micro Gen.HAN = Home Area NetworkEV = electric vehicleW = water

G

Mic.Gen

Wide Area Communications Network

Meter Data Storage and management Market Messages

Gas Industry

HANHAN

IHD

EV

W

SmartAppliances

Water Industry

Network OperationsManagement

Systems


39

However, very few examples of these exist today and what do exist are highly proprietary solutions. Standards in this area are still far from agreed. Therefore, there are many technical questions to be answered before any design proposal can be sketched out. In addition, the security and messaging solutions deployed across the infrastructure must be rock solid and fully tested against all potential attack vectors. Any weakness in any portion of this control chain opens up the possibility for serious disruption to electricity supplies for individual or multiple customers. Standards to support all of this are being developed but are still in their infancy. Question 13 – Respondents are invited to give their views on the additional functionality scenario C outlined above. In particular: • What are the additional requirements in terms of smart metering and

associated benefits to support the smart home? • What devices should be allowed to join the HAN? • Will there be any special metering or control requirements for Electric

Vehicles? • What is your view on what HAN standard should be used? • Is the technology too immature to progress with the functionality described in

Scenario C above.


40

5.0 Implementation Issues The overall high level phases of a Smart Metering Programme are: Phase 1 Discovery, Exploration and Business Case Development Phase 2 Planning, Requirement Definition, Procurement and Selection Phase 3 Detailed design, System testing and Pre-Deployment roll out Phase 4 Deployment Phase We are currently in Phase 1 of the program which will conclude in Q1 2011. Phase 2 involves activities such as:

• Development of the requirements with the stakeholders. • Agreement on the high level changes to the market system • Overall system design • It will also include the preparation by ESB Networks / BG Networks of the

technical and business requirements • Specification for smart meters, comm’s, IT • Procurement and selection process • Revisit business case

The current lack of standards around smart metering means that a lot of detailed work will be required at this stage. Given the immature and risky nature of the technology and the experience of the trials it is very important that adequate time is allowed in the selection process for the various components of the solution. This could take up to 2 years. Phase 3 will involve activities such as:

• Detailed Design • Install and test IT systems • Testing of meters and communications • Required changes to market systems and processes • End to end testing • Customer education • Deployment system and procedures • Deploy first block of smart meters ( C 20,000) • Review business case and proceed

This phase could take up to 2 years.


41

Phase 4 will involve ramping up of installation activity for full roll out. This phase could take between two and four years. Issues Relating to Implementation The above timing shows that it could be up to 4 years before the installations for the full roll out commence. It is important to recognise that customer acceptance is critical in achieving any of the potential benefits from smart metering. A programme of work is required as part of the National Smart Metering Programme to promote awareness and educate customers on these potential benefits of smart metering to the environment, economy and the customer. Question 14 – Respondents are invited to give their views on the high level implementation timelines outlined above. In particular: • Do you agree with the indicative timetable? • Do you agree with following an accelerated deployment or taking a more

phased approach in line with a scheduled meter replacement programme? • How should metering arrangements for Micro generators and Electric

Vehicles be dealt with before full roll out? • Should there be priority areas or priority customer categories for early roll

out? Question 15 – Respondents are invited to give their views on the need for customer awareness and education work programme as outlined above. In particular: • What would be the nature and timing of such customer awareness education

and promotion relative to the programme timelines? • Where should responsibility reside for the development and execution of such

an awareness programme?


42

6.0 Industry, Market Arrangements and Governance For the National Smart Meter Programme to be successful all stakeholders will have to deliver their elements of the programme. We need to understand the functional requirements of the smart metering solution to be in a position to assess the impact on market systems. Therefore such market systems impacts arising from smart metering will be covered in a future smart metering consultation paper. It will also be necessary to agree clear roles and responsibilities for the delivery of each element. An overall industry programme will have to be agreed and followed. CER will be responsible for the overall governance of the programme. CER will continue to oversee the development of the Smart Metering Project. It will coordinate Industry inputs, keep all stakeholders informed and up to date, and will also manage and coordinate any implementation programme.


43

7.0 Conclusions and Next Steps

7.1 Summary This consultation paper is the first in a series of consultations that, in tandem with findings from the smart metering trials currently underway, will aim to bring more clarity to the myriad of issues surrounding a full smart metering implementation in order to inform the cost benefit analysis for smart metering in Ireland. This cost benefit analysis will ultimately deliver a robust economic assessment of all the long-term costs and benefits to the market and the individual consumer of a national smart metering rollout and will also indicate which smart metering functionality scenario is the most economically reasonable and cost-effective, and which timeframe is feasible for implementation.

7.2 Next Steps An open workshop will be held half way through the consultation period to clarify any queries relating to the contents of this consultation paper. The scheduled date for this event is Monday 5th July. Confirmation of this date and further details relating to the event will be published on the CER Web site in advance. Date Action 11th June 2010 Consultation published 5th July 2010 Open Workshop on Consultation Paper 23rd July 2010 Consultation period closes Oct 2010 Further consultation to refine the issues and requirements Nov 2010 Open Workshop on Consultation Paper 2 Dec 2010 Consultation period closes Mar 2011 Complete Cost Benefit Analysis


44

Appendix A – List of Substantive Questions Appendix A provides a list of questions asked throughout this consultation paper - these questions are presented in the table below. The aim of this section is to allow for a “short-cut” option for respondents to submit their comments to the CER. Respondents are invited to complete the table to indicate their position on the questions being asked. Respondents should outline YES or NO answers to each of the questions listed. If they have a further comment which will clarify their answer, this should be included in the Comments box. Appendix A will be published alongside the consultation paper in Word format. Please note: Respondents are in no way obliged to respond to the questionnaire provided and are welcome to submit comments in their preferred format. When preparing responses respondents should indicate which question or proposal their text refers to. Please note also that, as the majority of questions posed in this consultation address both electricity and gas smart metering issues, respondents should make it explicit in their responses if their comments are applicable to electricity, gas or both.

Question

Yes No Comments

Section 2.0 - Objectives Q1. Respondents are invited to submit their comments on these stated objectives of the National Smart Metering Programme. In particular, do you agree with the objectives outlined for the Irish National Smart Meter Programme? Have you any other suggested objectives? If so give details.

Section 3.0 - Ownership, Display and Provision of Information Q2. Respondents are invited to submit their views on the granularity of data that should be available from smart metering systems and how this data should be made available to energy suppliers. In particular: • What granularity of data do suppliers require to carry out their business: interval reads, daily reads, monthly reads? • Do suppliers have a view on whether data


45

is pushed to them at defined frequencies or would they prefer to pull/access data from a web portal as required? • How frequently do suppliers want to access data? • What service levels are required around the various information sets that are required by the suppliers? • Do suppliers want to hold all historical data on their customers or are they happy to access historical data from a centralized portal? Q3. Respondents are invited to submit their views on how smart metering data should be made accessible to energy customers. In particular: • What information set should Customers be provided with? • Should suppliers provide data directly to their customers or would it be preferable that the data is accessible from a web portal provided by the network company / meter data collector? Or are there any other options that should be considered?

Q4. Respondents are invited to submit their views on the required frequency and detail of billing. In particular: - Do you have a view on the likely requirement for monthly billing of customers? - Do you have a view on the type of information relating to energy usage that should be contained on bills? - Also, for the purposes of such informative billing what granularity of data are the suppliers likely to require?

Q5. Respondents are invited to comment on the viability of the “Thin Prepayment” solution. In particular: • The availability of meter reading data to agreed service levels is important for the operation of a “thin meter” prepayment solution. What service level do suppliers


46

require for the thin prepayment solution? • Do Suppliers believe that the “thin Prepayment” solution is workable? Specifically do Suppliers believe they will be able to provide sufficient access to credit balances to Customers without any display on the meter? • Do Suppliers think that an occasional loss of the communications channels to the prepayment meter will cause difficulty? • How do respondents feel customers should be kept up to date on their balances? For example, do respondents see the provision of an In Home Display (IHD) as an essential part of a thin prepayment” solution? Q6. Respondents are invited to submit their views on how smart metering data can be made available dynamically in the home. In particular: • Do respondents feel that internet enabled technology could meet customer requirement for consumption information or will it be inadequate? • Do respondents view the In Home Display (IHD) as an essential feature of their future product offerings? • If an IHD is a requirement which of the following should be responsible for providing and maintaining the IHD and what are the reasons for your preference: The Customer; The Supplier; or Network company? • Do suppliers intend to offer products in the market that would feature load management or demand response by the customer? • What in your view is the high level minimum functionality for an IHD?

Q7. Respondents are invited to submit any comments or views on the issue of data ownership or data security relating to smart metering.


47

Q8. Respondents are invited to submit any comments or views on whether specific data provision and accessibility requirements for vulnerable customers need to be considered as part of a smart metering solution? If so, give details.

Section 4.0 - Smart Metering System Functionality Scenarios Q9. Respondents are invited to comment on the core smart metering functionality as outlined in Scenario A. In particular: • Do you agree with this core functionality? Are there any functions you feel should not be in the core scenario or are there any functions missing? • How many or what flexibility is required in relation to the number of Time of Use (ToU) registers on the electricity meter? • Apart from the current meter reading is there any requirement to display further information on the meter? Please bear in mind that meters are not easily accessible to all customers.

Q10. Respondents are invited to submit their views on the whether you think that leveraging the communications module in the electricity meter as a hub for Gas metering is a good idea or would you rather see a separate communications hub in the home to support gas metering?

Q11. Respondents are invited to give their views on the additional functionality scenario B. In particular: • Is one way communication between the Meter and the IHD sufficient? If not what are the additional requirements that would drive two way communications? • What are respondents’ views on the issue of the communications protocols to be used in the home? • What data should be provided to an In Home Display or equivalent from the meter?


48

Q12. Respondents are invited to give their views on the additional functionality scenario outlined in section 4.3.2 above. In particular is their any additional functionality required to support the “thin prepayment” solution?

Q13. Respondents are invited to give their views on the additional functionality scenario C. In particular: • What are the additional requirements in terms of smart metering and associated benefits to support the smart home? • What devices should be allowed to join the HAN? • Will there be any special metering or control requirements for Electric Vehicles? • What is your view on what HAN standard should be used? • Is the technology too immature to progress with the functionality described in Scenario C.

Section 5.0 - Implementation Issues Q14. Respondents are invited to give their views on the high level implementation timelines outlined above. In particular: • Do you agree with the indicative timetable? • Do you agree with following an accelerated deployment or taking a more phased approach in line with a scheduled meter replacement programme? • How should metering arrangements for Micro generators and Electric Vehicles be dealt with before full roll out? • Should there be priority areas or priority customer categories for early roll out? Q15. Respondents are invited to give their views on the need for customer awareness and education work programme as outlined above. In particular: • What would be the nature and timing of such customer awareness education and promotion relative to the programme


49

timelines? • Where should responsibility reside for the development and execution of such an awareness programme?


50

Appendix B – CER Smart Metering Project Phase 1 The Commission established the Smart Metering Project Phase 1 in late 2007 with the objective of setting up and running smart metering trials and assessing smart metering costs and benefits, which will inform decisions relating to the full rollout of an optimally designed universal National Smart Metering Plan. In order to draw on the experience and expertise of the electricity and gas market a Steering Group and a Working Group was established by the Commission for the Smart Metering Project Phase 1. Both groups are chaired by the Commission and consist of representatives from the Department of Communications, Energy and Natural Resources (DCENR), Sustainable Energy Authority of Ireland (SEAI), the Northern Ireland Authority for Utility Regulation (NIAUR) and Irish Gas and Electricity Industry Participants.

Smart Metering Project Phase 1 – Participants

To achieve its objectives the Smart Metering Working Group was divided into four Work Streams each focusing on separate aspects of the Smart Metering Project Phase 1: • Networks: Technical design and rollout of Smart Metering infrastructure.

Lead: ESB Networks (electricity) and Bord Gáis Networks (gas). • Customer Behaviour: Mainly focusing on the design and implementation

of all aspects of the customer behavioural trials, including participant selection, communications and analysis of results. Lead: Sustainable Energy Authority of Ireland (SEAI).


51

• Tariffs: Mainly focusing on design of Tariffs (Time of Use) and development of a Prepayment Market Model. Lead: ESB Customer Supply.

• Billing / Data: Mainly focusing on data flows from the Smart Metering infrastructure to Suppliers for customer behaviour trial billing options. Lead: Bord Gáis Energy Supply.

The CER is responsible for undertaking a Smart Metering Cost Benefit Analysis (CBA) and is working with the Economic and Social Research Institute (ESRI) in this regard. As part of this work, CER will identify all information requirements for a CBA, the party responsible for providing such information and the structure of the analysis.

Smart Metering Project Phase 1 – Governance Structure

Smart Metering Steering Group

CER

Smart Metering Working Group

CER

Tariffs Work Stream

Billing–DataWork Stream

NetworksWork Stream

Customer Behaviour

Work Stream

The key deliverables of the Smart Metering Project Phase 1 are depicted below:

High-Level Work Breakdown Structure (WBS) for Smart Metering Project

Smart Metering Project

Procure & Start-Up

Technology Trials

Customer Behaviour

Trials

Residential SMEs

Prepayment Market Model

Micro Generation

AnalysisCost Benefit

Analysis


52

The progress made in achieving these deliverables is summarised in the following table. Overall, progress continues to be very positive with all key milestones to date having been achieved. The main highlights to date have been the:

• Initiation of the electricity customer behaviour trials for residential and SME customers – due to complete end-2010.

• Initiation of the technology trials – due to complete Q3 2010. • Initiation of the gas customer behaviour trials for residential customers –

due to complete mid-2011. • Initiation of prepayment trial – due to complete end-2010. • Completion of scoping and planning of cost benefit analysis.

Summary Progress Update for Smart Metering Project Phase 1

Electricity CBT

•Recruitment & meter installation (c.6,500) completed•Benchmark data period completed 31 Dec 2009•Test period in progress: ToU tariffs, Billing, IHD, Web

Gas CBT •Recruitment & meter installation (c.2,000) completed•Benchmark data period completed 31 May 2010•Test period in progress: Billing, IHD, Variable Tariff

Technology Trials

•PLC & RF 2.4GHz trials in progress (c.4,000 meters)•RF 868MHz study planned•Gas trials being scoped & planned (c.150 meters)

Prepay •“Proof of Concept” Trial in progress (c.60 meters)Micro Gen •Data collection and analysis for CBA under way.Cost Benefit Analysis

•Scoped & planned with ESRI.•Preparatory work in progress for Interim CBA.

High-Level timelines for the Smart Metering Project Phase 1 are depicted overpage, showing completed and remaining activities. Further detailed information on the Smart Metering Project and its progress to date is available via periodic information papers that are published on www.cer.ie/en/information-centre-reports-and-publications.aspx .

• Information Paper 3 - CER/09/186 - 7th December 2009 • Information Paper 2 - CER/09/118 - 31st July 2009 • Information Paper 1 - CER/09/024 - 6th February 2009

Other CER publications on www.cer.ie relating to Smart Metering which may be of interest are: • Approved Smart Metering CBTs Gas Tariff – published 1st April 2010


53

• Approved Smart Metering CBTs Electricity Time of Use (TOU) Tariffs – published 2nd October 2009

• Arrangements for Micro Generation Decision and Response to Comments Received (CER/07/208) – 20th Nov 2007

• Smart Metering - The Next Step in Implementation (CER/07/198) – 5th Nov 2007

• Demand Side Management and Smart Metering Consultation Paper (CER/07/038) - March 2007

High-Level timelines for the Smart Metering Project Phase 1

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Initiation SG Sign-off

Technology Trials

Cost Benefit Analysis (CBA)

Electricity CBT Implementation

Q1 Q2

Vendors SelectedCBT Meter Delivery & Testing

CBT Meter RolloutCBT Smart Data Transfer

Interim CBA

Benchmark

Technology Trials

Customer Communications

Findings Report

Test Period

Recruitment

Final CBA

Findings Report

Gas CBT Implementation

Benchmark

Customer Communications

Test Period

Recruitment

Findings Report

Vendors Selected

Gas Addendum

CBT Meter Testing & RolloutCBT Smart Data Transfer

Prepayment Recruitment & System Set-up Findings ReportTrial Period

2008 2009 2010 2011

For further information on the Smart Metering Project Phase 1 you can contact Gary Martin at the Commission for Energy Regulation (e-mail: [email protected] or tel.: 01-4000800).


54

Appendix C – EU Smart Metering Initiatives There are currently a number of EU coordinated smart metering initiatives underway which include: a. Guidelines of Good Practice

Europe’s national energy regulators (The Council of European Energy Regulators (CEER) and the European Regulators’ Group for Electricity and Gas (ERGEG) represent Europe’s national energy regulators), are currently in the process of drafting guidelines of good practice on regulatory aspects of smart metering for electricity and gas.14 The guidelines comprise minimum customer services for the retail market customers and prosumers15, roll-outs costs benefits analysis and data security and customer integrity. The final version of these Guidelines is due to be published by the end of 2010. Europe’s national energy regulators are also actively participating in and following all of the below mentioned smart metering related initiatives: b. Mandate M/441

An initiative taken by the DG ENTERPRISE, is being organised by the European Standards Organisations. It is the mandate M/441 of 12 March 2009 to CEN, CENELEC and ETSI for the development of an open architecture for utility meters involving communication protocols and functionalities enabling interoperability, with the general objective to create European Standards that will enable interoperability of utility meters (water, gas, electricity, heat), which can then improve the means by which customers’ awareness of actual consumptions can be raised in order to allow timely adaptation to their demands. In order to comply with provisions of the 3rd Package, Member States must ensure the implementation of intelligent metering systems that assist the active participation of consumers in the electricity and gas supply markets. According to Mandate 441, the implementation of this provision requires the definition of new functionalities for smart meters that are additional to those in the MID16, as stated by the Commission in the mandate M/441.

14 C09-WPDC-18-03 European Energy Regulators’ 2010 Work Programme. 15 Consumer also being a producer of electricity/micro generation. 16 Directive 2004/22/EC of the European Parliament and of the Council of 31 March 2004 on measuring instruments


55

c. Open meter project

A second initiative, taken by the DG RESEARCH, is the “Open Meter Project”, financed within the Seventh Framework Programme of the Commission, that has the main objective to specify a comprehensive set of open and public standards for AMI, supporting electricity, gas, water and heat metering, based on the agreement of all the relevant stakeholders in this area, and taking into account the real conditions of the utility networks so as to allow for full implementation. The scope of the project is to address knowledge gaps for the adoption of open-standards for smart multi-metering equipments and all relevant aspects – regulatory environments, smart metering functions, communication media, protocols, and data formats – are considered within the project. The result of the project will be a set of draft standards, based on already existing and accepted standards wherever possible. Existing standards will be complemented with new standards, based on innovative solutions developed within the project, to form the new body of smart metering standards. The resulting draft standards will be fed into the European and International standardization process The project is strongly coordinated with the smart metering standardisation mandate given by the European Commission to the European Standardization Organizations, CEN, CENELEC and ETSI. This project officially started on the 1st of January 2009 and it will be accomplished in 30 months, by 30th June 2011. Standards are voluntary technical specifications and common technical rules for products or systems to be placed on the market. A standard is considered to be open when17: • it is adopted and will be maintained by a not-for-profit organization and its

ongoing development occurs on the basis of an open decision-making procedure available to all interested parties;

• it has been published; • standardized interfaces are not hidden or controlled other than by the standard

definition organization promulgating the standard; • there are no constraints on the re-use of the standard.

17 M/441


56

d. Task force on smart grids

In January 2010 the DG ENERGY launched a Task Force on Smart Grids whose mission is to advise the Commission on policy and regulatory directions at European level and to coordinate the first steps towards the implementation of smart grids under the provision of the 3rd Package The ultimate goal of the Work Programme of the Task Force is to identify and produce a set of regulatory recommendations to ensure EU-wide consistent and fast implementation of smart grids, while achieving the expected Smart Grids' services and benefits for the network users, notably: • What does active participation mean for consumers? • How is electricity data different from other data? • How to best protect consumer data. • How to best inform consumers of the benefits of Smart Meters and Smart

Grids. • What mechanisms are available for the protection of vulnerable consumers? The initial duration of the Task Force is 20 months, till May 2011. The planned efforts of this Work Programme are focussed on the following initial Expert Groups: Expert Group 1: Functionalities of Smart Grid and Smart Meters. The key deliverable is to provide an agreement among all actors involved on a set of minimum functionalities for Smart Grids and Smart Meters. Expert Group 2: Regulatory recommendations for data safety, data handling and data protection. The key deliverable is to identify the appropriate regulatory scenario and recommendations for data handling, safety and consumer protection. Expert Group 3: Roles and responsibilities of actors involved in the smart grids deployment. The key deliverable is the development of recommendations on the roles and responsibilities of all involved actors in the implementation of the Smart Grids as well as the definition of criteria and recommendations for funding of Smart Grid deployment.


57

Appendix D – Smart Metering Status in EU Countries ERGEG Status review on regulatory aspects of smart metering as of May 200918 An analysis of the diverse roll-out-policies for electricity and gas in Europe has not provided a uniform picture. In electricity, Italy and Sweden have completed their roll-out for 90% and 99% of customers, respectively. In addition, 4 countries have decided a large scale rollout of smart meters. Meanwhile, in a further 11 countries a roll-out is under discussion. In some countries, the roll-out is executed on a voluntary basis executed by network companies, while in others it follows official legal provisions. Overview of status of electricity smart metering roll-out (Source: Table 1, ERGEG Status Review of Regulatory Aspects of Smart Metering as of May 200919)

In gas, there are fewer uptakes of smart meters, only Italy has a planned roll-out, while 4 countries are discussing the possibility. Several countries have decided that smart meters for gas are not presently economically justifiable. 18 E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf 19 Ref: E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf


58

Status of gas smart meter roll-out (Source: Table 2, ERGEG Status Review of Regulatory Aspects of Smart Metering as of May 200920)

The decision to introduce smart meters can be in part based on a cost benefit analysis. In electricity, 15 countries are or have conducted an assessment of the economic implications of smart meters. In gas, 11 countries are or have conducted this analysis. In some countries, the findings indicated that for a certain market the smart meters are not economically reasonable or efficient. That being said, some countries that have decided to introduce smart metering did not conduct a cost benefit analysis, illustrating the disparity in the rationales for smart metering in individual markets. NOTE: Since this ERGEG report has been published Ireland has a rollout plan for gas smart metering under discussion. Also, the British government has mandated a national roll-out of smart electricity and gas meters.21

20 Ref: E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf 21 http://www.decc.gov.uk/en/content/cms/what_we_do/consumers/smart_meters/smart_meters.aspx


59

The ERGEG Status review on regulatory aspects of smart metering report found that the most important policy objectives for supporting and encouraging a roll-out of smart meters in both electricity and gas are energy efficiency, peak load management and more frequent meter readings; with 15 countries for electricity and 10 for gas having mentioned all 3 or a combination of them as the main drivers. Meanwhile, the 2 most important regulatory tools for doing so are legal obligations and minimum functional requirements.

(Source: Figure 2, ERGEG Status Review of Regulatory Aspects of Smart Metering as of May 200922)




60

Regarding the possible expected benefits of a nationwide and standardised roll-out of smart meters for all domestic household customers, the Status Review found that for both electricity and gas the promotion of energy savings and energy efficiency was the most important benefit overall. Other areas where the responding countries see advantages are the possibility to develop new tariff models which better reflect consumption behaviour; to give information on the global peak of consumption and contribute to an accurate network management; and to better detect fraud.


23 Ref: E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf 24 Ref: E09-RMF-17-03 http://www.energy-regulators.eu/portal/page/portal/EER_HOME/EER_PUBLICATIONS/CEER_ERGEG_PAPERS/Customers/Tab/E09-RMF-17-03_SmartMetering-SR_19-Oct-09.pdf


61



Documents

Consultation on Possible National Rollout Scenarios for the ...CER10082 Possible National Rollout Scenarios for Smart Metering Cost Benefit Analysis 8 This consultation paper is the