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IIoT devices, services and software drive IoT market

A new report from Navigant Research has determined that global revenue for IIoT devices will total more than $1 trillion between 2017 and 2027. The report,...

The path to a sustainable electricity system: decentralised control

We need a new platform for electricity, transforming our old assets into a highly flexible system with the autonomy to manage disturbances real-time.

Metering systems standards are in the safe hands of TC 13

Metering systems standards are in the safe hands of TC 13

TC 13 was one of the first technical committees created by the IEC. Originally involved with measuring equipment for the electricity industry, TC 13 today is responsible for establishing standards for equipment for electrical energy measurement and load control. There are 28 participating members from countries around the world.

Smart Grid Pilot for Germany

[img:Germany.thumbnail.jpeg| ]October 6, 2009 - Yello Strom, among Germany's top 10 electricity companies, and Cisco (NASDAQ: CSCO) today announced the launch of a 'smart grid' pilot. Its aim is to create an intelligent energy system that allows customers to measure and control the power consumption of their electrical appliances, enabling them to reduce their monthly bills as well as carbon emissions, while significantly cutting down on peak-period demand.

The Next Phase of Electricity Regulation in South Africa

The South African electricity supply industry is based on the traditional vertically integrated utility model, with generation and transmission largely dominated by Eskom. The distribution industry customers are currently split at a ratio of approximately 60:40 between the localised municipalities and Eskom.

Electricity demand has grown at a faster rate over the last few years, resulting in increased usage of an ageing infrastructure. The generation reserve margins are being depleted whilst the maintenance levels, costs and intervals are increasing sharply. Customers expect high power quality and reliable supplies. The multi-year price determination (MYPD) that will be concluded by mid-February 2006 will continue to govern the pricing and tariffs for a period of three years.

Smart metering: Reinventing the principal-agent relationship in the utility

By William Nicholson and Mike Malloni, Capgemini Smart Energy Services

High costs, rapidly changing technologies, and shifting energy market dynamics continue to impact smart meter programs and challenge the conventional business models used by utilities to implement and manage these programs. Traditional accounting and regulatory rules that govern these programs have limited the commercial and delivery options available to utilities, constraining their ability to fully optimize quality of service, costs and benefits.  

The typical capital-centric governance models used to manage smart meter programs see a utility acting as the commercial and delivery principal, managing multiple vendor agents, often resulting in sub-optimal quality of service, inflated costs to ratepayers and lengthened timelines for implementations. These inefficiencies in achieving a program’s goals and the limited capacity for a utility to manage the process effectively under these conditions reflect the classical economic model of the Principal-Agent problem.

Standard Principal-Agent theory states that a principal – such as a utility – will hire one or more agents – a vendor or supplier for example – to achieve an outcome that it either cannot achieve on its own or cannot maximize without support from the agents. The challenge of operating under this model is that the self interests of all parties are never fully aligned and a principal never has full visibility into an agent’s self interests, creating asymmetry in information and objectives. In order to align an agent’s interests to its goals and optimize performance, a principal must develop incentive mechanisms that will influence agent behavior.

Utilities apply classic economic incentive mechanisms to smart meter programs to influence vendor and supplier behavior. These include both positive and negative incentives such as performance bonuses, milestone incentives, rate cards, bonds, and termination conditions. The challenge lies in attempting to align and manage these incentives across a network of vendors and suppliers and remove the issue of asymmetric information. The size and complexity of these programs have forced utilities to shift attention away from their core competency – electricity delivery – to managing legal and commercial frameworks needed to align incentives. Today, it is commonplace for a utility to have a dedicated full time commercial team assigned to a smart meter program.                

In response to these inefficiencies, some utilities are starting to adopt a Managed Business Service (MBS) approach to smart metering – an option that improves the principal-agent problem significantly. It shifts the burden of managing inherent asymmetric information across multiple vendors to a single primary service provider. Outcomes are optimized by reducing multi-vendor complexity to a single contract between the utility and primary service provider that is directly based on overall business performance and objectives. Refreshingly, with MBS, managing multiple vendors and suppliers is the responsibility of the service provider, which has expertise and experience with this model.

What is MBS?

So what exactly is MBS? Let’s start by looking at large scale smart meter programs, specifically the fact their subsequent support operations require a complex network of stakeholders to implement and manage their functions. The traditional hierarchical commercial and delivery models employed by utilities to govern these programs carry structural risks that prioritize efforts on cost, stakeholder and schedule management. Although these programs represent fundamental business transformations to a utility, the resulting principal-agent relationships applied to these complex programs do not inherently maximize service and value creation, nor do they align the rational choices of the agents (vendors) to the key principal (utility).
    
A smart meter MBS transforms a utility’s meter-to-cash lifecycle into a series of services measured against business-based goals. A utility can focus on service and value creation through a shared governance model that shifts and shares risks with a service partner. Costs become predictable through unit-based pricing models over fixed contract periods. The service provider is responsible for sourcing, installing, operating and refreshing the smart meter infrastructure and systems, thereby minimizing upfront investments and technology risks to the utility.
 
On average, an end-to-end smart meter program can require five to 10 major vendors covering various services and products including meter operations, systems integration, telecommunications, field services, and meter infrastructure. Under this scenario, an experienced service provider has clear advantages over a utility. The service provider will have long term relationships with vendors across multiple smart meter and utility programs in various geographies. This experience, intimacy and ability to re-use common work products and processes across programs results in superior program and operational performance.

MBS Schematic
Schematic of MBS

 

E.ON Sweden Selects Echelon’s NES Smart Electricity Metering System for 370,000 Customers

(San Jose, CA - June 7, 2006) - Echelon Corporation (NASDAQ: ELON), announced today that Sweden's largest utility, E.ON Sverige AB, has selected Echelon's NES System for deployment to 370,000 customers in the Malmo, Orebro, and Stockholm areas of Sweden.

Smart systems and digitalisation – Britain’s net zero plans set out

A smarter and more flexible energy system based on data and digitalisation are at core of Britain’s 2050 net zero plans.

UK smart meter rollout is stumbling – consumer survey

Approximately 20% of consumers are still being offered “old” technology - report

AMI pilot project: Brazil


Conference: Metering, Billing/CRM India
Location: Mumbai, India
Presenter: Luiz Garbelotto
Abstract: Presented by Luiz Garbelotto at Metering, Billing/CRM India

During the nineteenth century human inventiveness brought to existence not only wonderful machines but also lucrative businesses. After all it was necessary to take the inventions benefits to people eager by the news. At the end of that century, together with the electric bulb invention, as it was necessary to supply the user a with power source, it came into being the electricity generation and distribution business.

Since that beginning, electricity distribution operators searched for ways to measure the quality and quantity of energy delivered to their clients, in order to receive the due payment for their investments and services. At that time the solution was to install a metering instrument at each premise and periodically, let’s say monthly, send a person to collect its indication. More than a hundred years have passed and things are still the same!

Electricity is an invisible product that flows through metallic wires, which demand is determined by the user. The sold energy is not witnessed by its seller. There’s only a measure machine, very quickly monthly visited by a person to collect its register.

Automation

In human society there’s a constant searching for welfare. Nature, besides its prodigal benefits, also causes discomfort and sometimes aggression to man. Wind, rain, storm, snow and intense heat always demanded man’s creativity in order to lessen his sufferings.

Man’s limitations also led him to create alternatives that could do great efforts instead of him or that could better his performance. Activities that more frequently demanded physical strength became targets to creative effort to the conception of machines. By this process came the knife, the wheel, the lever. Then man perceived that the same forces of nature which sometimes hurt him could be used for his benefit, if properly controlled. So, man exploited winds, waters, steam and even animal power. Preferred were daily and repetitive tasks.

Much time has passed, as past is Industrial Revolution, then a new technology domain comes: automation.

Automation is total or partial replacement of human intervention in the execution of tasks that otherwise would require more physical or intellectual effort from man. Besides human effort reduction, automation frequently conveys more efficiency, shortens execution time, increases accuracy and reliability, diminish accidents risk and increases uniformity of results. It is not its goal jobs posts elimination, but generally has this consequence. The capitalist enterprise, profits focused, is generally in search of means to reduce operational costs, to which automation has much to contribute.

Meter reading is fit for automation

Meter reading is a centennial practice fit for automation. Around the world millions of peoples still walk around every corner to read meters. The moment for the great leap has come. Technologies are available and their costs are getting down. But, as solutions appear electricity distribution companies are doubtful about what is the right path to follow. What technology to choose? What are the risks involved? What are the impacts to the modus operandi of the company? How much would a full deployment cost? How fast should it be undertaken?

At Celesc, thinking about this, we realized that a reasonable step should be to implement a pilot project. Pilot project is a complete system miniature, operating in real conditions. With a pilot project we can face, in a much lowered degree, technical challenges, human dramas, budget restrictions and proofs of the organizational model.

Celesc’s pilot project aims to achieve several goals: to test the technology, to identify the risks to be faced in a full-scale deployment, to produce unabridged documentation about perceptions, requisites and preferences that will serve as lessons learned, and to test concepts. To that end, the pilot project has the following functionalities:

New concept to help Chinese cities achieve carbon peaking and neutrality goals

RMI provides recommendations on how cities in China can achieve carbon emissions reduction goals set by the government.

Podcast: Drivers for change in the energy sector

Against a backdrop of increasing regulatory demands, market adjustments, cost efficiencies and increasing consumer demand, utilities are challenged to be much more agile than...

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