By Andrew Blyth, Chief Executive, Energy Networks Association
Electrical engineers will tell you that heat needs more energy than light. Whilst recent public discussion in Australia on smart meters has certainly generated plenty of heat, what we really need is for more light to be shed to understand what the smart meter rollout is all about.
When infrastructure is as essential as the electricity network is, it can be a bit unsettling to see a short-term focus dominate debate about the community’s long-term interests. That’s why it’s vital to understand that smart meters are indeed the foundation for a profound – and necessary – shift in the way all consumers use and manage our energy consumption.
If we are to improve the reliability of electricity supplies, curb our emissions and keep a cap on the costs of supplying electricity at peak times, it is essential to transform the way electricity is used and delivered. Major delays or even the cancellation of the smart meter program would significantly limit the industry’s ability to introduce service improvements and innovations, and prevent consumers from receiving additional benefits.
The smart meter rollout in Victoria will see 2.5 million smart meters installed over the next four years in all homes and small businesses. To date, some 100,000 smart meters have been installed – on schedule, and on budget. Importantly, the meters being replaced are a part of an asset replacement program as, in some cases, existing meters are 30 years old.
Trials undertaken both in Australia and internationally have indicated that many customers will seek and respond to information about their electricity use by changing when and how much electricity they consume. However, some vulnerable customers may not be able to shift their electricity demand and so may need safety nets.
The Victorian Government has announced its desire to ensure vulnerable customers are not unfairly affected. In support, Victorian distribution businesses have paused the introduction of time-of-use prices until more work is done to ensure the changes are fully understood across the community and adequate customer protections and concessions are in place. During a recent visit to Alice Springs, the Alice Springs Solar City program office informed me of the “no worse off” tariff that is in place. This information has been shared with key officials.
The Victorian Government has also indicated that it will embark on a consumer education campaign to provide clear information about the need for smart meters and the ways consumers can manage their energy consumption.
While smart meters create links between every end point of electricity networks, there are also massive opportunities for new efficiencies and capabilities by making the grids themselves “smarter.”
Looking into the future, there will be an increasing need to connect renewable generators, and small scale distributed generators, energy storage technologies and electric vehicles to reduce Australia’s reliance on fossil fuels and therefore carbon emissions.
In the absence of smart network investments, peak electricity demand will continue to grow and all customers will suffer through increased outages at peak times when the systems’ capacity is exceeded. The alternative is to invest in extra generating and network assets that will sit idle most of the year and only operate in peak periods.
With a billion dollars already invested in this project – and the rest of Australia closely monitoring the program – energy network businesses are determined to make the Victorian smart meter rollout a success. Smart meters are an essential tool for tackling climate change, enhancing competition and controlling energy costs – it is essential that these tools are placed in our hands to assist us to better manage our energy use.