Smart metering: It begins
The rollout of smart meters will usher in a new digital dawn for energy, bringing network operators out of the darkness and into the light. But not before some stumbles.
20th September 2016 by Networks
The wait for the dawn of the digital age of the energy industry has seemed endless. Around 53 million smart meters will be installed by energy suppliers at homes and small businesses in the UK by 2020, opening up a world of consumption data, time-of-use tariffs and a whole new market of smart home products.
Energy suppliers have been installing smart meters for some time but have been waiting on the completion of the Data and Communications Company (DCC) network to ramp up the installation rate and make real headway against the overall target. DCC managing director Jonathan Simcock was less than reassuring when speaking to Utility Week back in January, saying he could not guarantee that deadline would be hit.
For the past year all eyes have been focused on the DCC as it has battled to make that critical deadline. The rollout go-live date has been highlighted by industry professionals in an exclusive report, produced by Utility Week in association with WNS, in July as the highest risk factor to timely delivery of the programme to the 2020 deadline. It is a deadline most in the industry consider not just tight but unachievable.
The go-live date has slipped several times already, the latest being from August to the end of September, although this is still within the six-months contingency given to the start date.
The DCC is currently consulting with industry on the appropriateness of this new deadline and it should be put to the secretary of state for the newly created Department for Business, Energy and Industrial Strategy shortly.
But meeting this initial deadline is not the only hurdle the programme needs to overcome. The smart meter specification has yet to be decided, as has the method for incorporating foundation meters into the DCC, both potentially serious challenges to the programme.
From October the rollout should move into the practical installation stage, and this will come with its own set of complications. Network operators, reliant on suppliers to lead the rollout, have expressed a range of concerns over installation. Each installation, given a customer is willing to accept a meter in the first place, runs the risk of failure for multiple reasons which will require the involvement of the local DNO.
At the same time, both suppliers and DNOs must start positioning themselves to take full advantage of the deluge of consumption data in order to enhance customer service, and in the case of DNOs aid the transition to smart grids.
The DCC’s work continues
Although around 2.89 million smart meters have already been installed in the UK, none of these meet the specification requirement – itself yet to be decided – of the final rollout and are not compatible with the DCC network. These will need to be incorporated on to the DCC or replaced with final specification meters. The DCC will publish a draft report on the adoption of SMETS 1 meters in September.
It will then also turn its attention to the ongoing issues with power outage alerts that came to light late last year. The “last gasp” and “first breath” signals given by smart meters are crucial to the evolution of truly smart grids and improved customer service for DNOs, but the delay on these notification times is currently too long to be of use. In his column (right), Matt Rudling, director of customer services at UK Power Networks, reveals how these notifications will underpin his customer care strategy.
On the DCC network go-live, the DCC will commence an “early life study” that will explore the options for improving performance of the alerts. The DCC is hopeful that the study will provide the understanding needed to improve the usefulness of the alerts for network operators on an enduring basis.
When the smart meter programme moves into the main rollout phase a range of other risk factors threaten the timely delivery of the scheme. The Utility Week-WNS report reveals that network operators have a far higher level of concern across the board on these risks than suppliers. In particular, customer co-operation and suppliers’ ability to contact customers came out as top concerns among networks.
Gaining access to properties through successful communication and co-operation is the first hurdle in a range of challenges standing in the way of a successful installation at the first attempt. Installation can fail for one of three main reasons: consumer issues; supplier issues; and network operator issues.
The nature of customer properties and issues requiring network callouts are two of the main risks that network operators are concerned about. More than half of network operators questioned for the report said they expect callout rates to rise during the smart meter rollout.
The network operators’ price control assumes that 2% of all smart meter installations will result in a callout. The rate is expected to be as much as 6% during the early stages. Worryingly, less than half said they have enough staff to deal with that increased rate. An equal percentage said they don’t know if their resources will be sufficient at this point.
Data on the actual rate of installation failure is so far only available for London, but segmentation of the city by postcode area gives some hint of the likely level of problem solving network operators will find themselves undertaking as the rollout progresses. Electralink, the data transfer service for the energy industry, expects to perform further analysis of the actual experienced causes of failure in the coming months.
As the rate of installation starts to ramp up to the required level to meet the deadline, more than doubling by 2018 from the current rate, communication between suppliers and network operators will become ever more important. Although in the Utility Week-WNS report it was again network operators most concerned about communication, it was supplier EDF that voiced worries at the start of this year about a lack of visibility of GDNs’ preparations.
Ofgem is also pushing for suppliers to put aside competition and share elements of best practise for the benefit of the whole programme. This particularly applies to sharing techniques for completing difficult installations. Suppliers may find this of key benefit when they come to mop of the expected “tail-end” of difficult installations at the end of the programme.
Because the rollout is not by geographical location, it may be some time, even after the rollout ramps up, before network operators start to receive the data that is so pivotal in the transition to smart grids. Data on the installation density in different areas is expected to start becoming available in the coming months, so the situation can be monitored. But while the key moment of go-live is waited for, and in its wake, network operators need to ensure that the correct systems and processes are in place so they can take maximum advantage of that data when it does start flooding in.
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