The Energy and Climate Change Committee has cautioned the Government's smart meter roll-out needs to be managed carefully

MPs back smart meter roll-out

A parliamentary report has confirmed the potential of smart meters to benefit both consumers and Britain’s energy infrastructure.

However, it cautions that the roll-out needs to be managed carefully if all these benefits are to be achieved and costs kept under control.

“We support the Government’s ambitious roll-out programme, but there are several key issues that must be addressed to ensure the scheme is a success,” said Sir Robert Smith MP, on behalf of the Energy and Climate Change Committee.

“For them to generate their expected benefits consumers must actively and positively engage with them, and there are several steps that DECC and Ofgem should take to ensure this.”

“First, it is crucial that the aims and potential benefits of roll-out are clear and that public concerns are addressed. Second, positive consumer interaction with smart meters will be aided by the use of in-home displays. And finally it is important that the first experience consumers have with smart meters is positive.”

The report also highlighted the importance of controlling costs. DECC estimates that roll-out will cost around £12.1 billion and expects smart meters to achieve savings in the order of £18.8 billion.

Mass roll-out has already been put back a year, so it is now scheduled to start in 2015 and be completed in 2020. Dave Openshaw from the IET Energy Policy Panel and UK Power Networks, is optimistic that the programme will remain on track to achieve that timetable.

“We now have almost finalised specification for the smart meter, although we are still yet to see what the results will be for the procurement process to provide the communication and data systems to support the meters,” he said. “DECC will be announcing the winners in the near future. That will determine the wide area network to be used.

“What is going to be critical over the next couple of years before mass roll-out begins is the end-to-end testing of the systems including the smart meters themselves, the communication systems and the head-end systems,” Openshaw explained. If that work stays on track, so should the whole programme, he said.

The MPs’ report points out that there are greater opportunities from smart-meters than just giving consumers better information about their energy use. These include operational savings for energy suppliers and, potentially, facilitating creation of a smart grid to smooth out peaks and troughs in electricity supply and demand.

“The report is quite right, and the IET has always stated that there are wider system benefits,” Openshaw continued. “Those messages now need to be incorporated in the communications to make sure that consumers understand that, but we also need to develop the systems.

“Because we are quite rightly looking at how we can decarbonise electricity production, which means making more use of renewables and nuclear, that will create some new challenges for managing the grid system in real-time. Wind and solar are intermittent, so that contribution will change day-by-day and even during the day.

“For consumers to take maximum advantage of renewable energy, we need to get smarter about the time of day, or even on which day electricity use will be taken. Washing machines are a classic example where you could, given the correct incentive, decide to delay your washing until the following day or even bring it forward a day if the price of electricity is expected to vary.”

UK Power Networks is already running some trials with around 1100 domestic consumers. “We are using a critical-peak-time tariff, which is a day-ahead tariff, so consumers know a day in advance what the electricity price will be at different times of the day,” Openshaw explained.

“We are seeing some very real changes in consumer behaviour, with significant shifts in demand to avoid high-price periods. That is the sort of message that we need to get across.

“Whilst consumers can make informed decisions and intervene manually, the vision is that you will have smart appliances that can either respond to control signals or tariff price signals. Electric vehicle (EV) charging would be a classic example. One of our concerns is that users may plug in their vehicles as soon as they get home each day.

“Six o’clock on a weekday evening is already the time when there is peak demand on the system. It also often coincides with anti-cyclonic conditions when there is very little wind generation and of course no solar PV output. So rather than the vehicle charging at 6pm it could wait for a low-price signal in the very early hours of the morning.”

The smart meter that is being installed will give the network operators some valuable information such as demand and voltage levels on their networks. That is particularly important with the expected growth in EVs and on-property solar generation.

“Where we think that needs to evolve is that in the future we may need to take some near real-time actions such as smart meters communicating directly with our control centres or active network devices,” Openshaw concluded.

Access the Select Committee report here.

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