January 29, 2018

Winning or just surviving with second-generation Advanced Metering Infrastructure?

Olof Ferenius

Head of Energy Utilities, Tieto

Smart metering is entering its second generation, and the distributors are preparing for massive investments in the coming years. Are you making full use of the digital possibilities of your Automated Metering Infrastructure?

When you as a consumer plan to buy yourself a new smartphone, you probably think of what you’re going to use it for. You probably also build some room to grow into your specs to avoid your new phone running short of memory, features and capabilities at least for some years. Then you find the best balance between your specs and the price of the device.

The same line of thinking should also guide you when you’re planning an Advanced Metering Infrastructure (AMI) for your distribution company.

Next-generation smart meters are a lot smarter

AMI deployment has developed in different ways in the Nordic countries. Swedish grid companies rolled out the first generation of smart meters ten years ago. Finland started smart metering a few years ago, and Norway is currently in the middle of a big rollout scheduled for completion by the end of 2018. The old infrastructure is now starting to be replaced with a new one, requiring a well thought-through migration strategy. But is it really there?

First-generation smart meters allowed remote reading, which, of course, made the electricity consumers’ lives a lot easier with no need to send the readings to the distributor for billing.

Second-generation meters are capable of much more. They are geared towards reading the consumption at hourly, even 15-minute intervals, they feature two-way communication – both from and to the meter – thereby allowing the grid company to steer and control the meter remotely. What is even more important, though, is that the meter can supply a whole host of other data than just readings.

Are you taking full advantage of smart meters?

The rollout is a big undertaking, no doubt about that. Yet, you should extend your planning beyond the rollout. Have you prepared for handling and using the data you now have at your fingertips? Do you know what you can do with all this new data?

The minimum requirement for smart metering is meeting new regulation that concerns information supply to regulators and data hubs. Considering the cost of hundreds of thousands of new boxes, plus installation, wouldn’t it be nice to go further than just the bare minimum?

Second-generation smart meters are expensive. The actual business case for a distribution company, therefore, does not come from more accurate metering, remote disconnection or monitoring, but peak elimination.

With the prices of solar panels dropping at a fast pace, more and more former consumers of electricity are also becoming power generators. Distributed energy services, with electric cars and household batteries acting as a power reserve, require new transparency and reciprocity in pricing. Peak load control, outage recovery, asset management, billing, delivery quality monitoring and investment planning also benefit from extensive and detailed use of data.

How are you planning to make use of Artificial Intelligence and the Internet of Things to extract the maximum benefit from the huge amounts of data available to you through your new smart meters?

Customer experience is key

The modern consumer subscribes to green values and has an appetite for transparency and value-add. Grid companies today show stable financial performance figures, but if consumers perceive them as reacting slowly, constantly increasing prices and providing little added value in exchange, distributors may need to brace themselves for an increasing consumer motivation to go off-grid. Such a backlash in mass market consumption behaviour will render a large part of distributors’ long-term grid investments questionable.

The question, therefore, remains – how do you intend to take maximum advantage of your AMI rollout?

Read more about AMI

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