According to smart grid and metering specialist Sentec, despite the hype, few regions in Europe have made much progress in rolling out smart meters, although that may change by 2015. Based on IMS Research data, Sentec has produced a ‘heat map’ on rollouts to date and predictions for 2015.
Leading the race are Italy and the Nordic countries, with over 94% and 70% of meters installed respectively. In Italy the main reason is a 2006 investment of $3bn in smart meter technology by Enel, Italy’s largest power company. In Sweden the first policy of regulation-driven rollout of smart meters has promoted implementation.
IMS’ predictions for 2015 show France (49%), Spain & Portugal (73%) and the UK & Ireland (65%) catching up. However there is uncertainty as to whether the UK will reach its potential this fast. According to Mark England, Sentec’s CEO, “The deregulated structure of UK market is uniquely challenging for rapid and coordinated action in a large scale initiative like this and we believe that smart meter deployment in 65% of UK homes by 2015 is not possible. There is a great deal of work still to do to finalise the technical and regulatory framework for smart metering.”
Overall, Western and Northern Europe are expected to see over 70% penetration of smart meters by 2015, with Germany and Poland lagging behind with less than 30% penetration by 2015.
The research highlights the fact that there is still along way to go in smart meter deployment in Europe. It also points out the difficulties facing the UK, despite having an implementation schedule in place.
In the UK, questions continue to be asked about whether implementing smart meters is good value for money. The Department of Energy and Climate Change (DECC) has estimated that installing smart electricity and gas meters will deliver economic benefits of £18.6bn between 2011 and 2030 from an initial cost of £11.3bn. But among the figures is the fact that smart meters will save the average customer just £23 a year by 2020. The National Audit Office (NAO), the UK government department that scrutinises public spending on behalf of Parliament, has highlighted the uncertainties of consumer benefits, because of lack of evidence. The NAO believes the risk is compounded by potential cost increases, the challenges of delivering a fit-for-purpose and secure system and the risk that suppliers do not pass on all the savings to their customers.
Add to that the consumer resistance to the use of smart meters, because of hazards to health from wireless devices or because it means ‘Big Brother’ knows when you boil a kettle. Most of the concern comes out of the US, but it does seem to have had an impact in the UK (although less so elsewhere in Europe). As a result, UK energy minister Charles Hendry was recently reported as saying that smart meters would no longer be obligatory, as was the initial plan.
The bottom line is that we have to have power grids that are much more flexible in order to manage renewable power generation from sources that vary in output, such as solar and wind. It also needs to manage micro-generation and different demands on supply, such as electric vehicle charging. All of that can only really work if we have real-time differential tariffs, which needs smart meters.
It would be more effective to introduce the meters with at least a coherent plan for smart grids and their benefits. But in the UK we’ve put the cart before the horse. Smart meters with no smart grids in sight.