Advanced metering in the Netherlands – some current policy issues


By Remon Dantuma

The Dutch parliament adopted revised legislation in July 2008 introducing a two-year trial period for smart metering and relaxing a mandated rollout.

The two year “trial” period will most likely start on 1 January 2009, during which the installation of smart meters will be mandatory in new buildings and in the cases of major renovations or major improvements of a building in terms of energy savings and reduction of CO2. In all other cases, the installation of smart metering is voluntary.

The trial evaluation will review issues like the installation process, installation capacity, functioning of the smart meter and AMM systems, protection against hacking, and adequate facilitation of administrative processes like billing. Once deemed successful, a decision will be made on a mandatory smart meter rollout, expectedly from 1 January 2011, to all remaining small user connections, within a timeframe to be decided.

In terms of the legislation, and in line with the original plans, the grid operator is responsible for the management and administration of all meters and controls access to the data. This way the Dutch government seeks to achieve inter alia:

  • Guarantee of open access to disaggregated usage data whenever the customer gives permission (in order to enhance the potential for the provision of energy management services), and
  • Regulation of the meter market in terms of tariffs, technical requirements, and the connection of smart metering with other public goals such as smart grids, network management and security of supply.

The aspects of smart meters that have attracted most attention in society and in the Dutch parliament are:

  • Privacy issues: Concerns that the meter is capable of generating such detailed usage information that individual customer patterns could be drawn, e.g. when they are away from home or on holiday, resulted in parliament deciding on more explicit and stricter rules regarding permission of the customer to use their most detailed meter data.
  • Costs: Parliament has decided that there should be no increase of tariffs from introduction of smart metering. This means inter alia that the financial benefits of smart meters for the grid operator should be used to subsidise the installation costs, and the feasibility of this will form part of the trial evaluation.
  • Meter “smartness”: Is the meter “smart” enough to warrant the large investment and is it future proof? The dilemma is whether a positive business case is only possible with various added functionalities (and should these functionalities be mandated for all meters, or only if requested by the user), or whether the smart meter become too expensive with all these extra functionalities?

With regard to this last point the European Commission has requested information on the standardised minimum technical requirements (Dutch Technical Agreement 8130) in the proposed Dutch legislation. The main concern of the Commission is due to the fact that various European member states are now preparing individual legislation and standards for smart meters, national energy companies are likely to buy only meters that comply with the national standard and not meters that comply with European metrology regulation. This would hinder the development of both the European internal market as well as energy management services that could be provided across borders.

The Dutch government has responded that in its view the smart meter consists of various components. The metrology component is regulated by the European Directive on measuring instruments, and additional requirements on this component by national authorities are prohibited. However, additional specifications and functionalities of the smart meter, for example feeding back energy into the grid and prepayment, could be added via separate equipment as an additional component to the AMI system. The Commission also confirms that the EU Directive on measuring instruments is open to innovation on additional functions. Because of this context the option of a modular approach is not excluded in the proposed Dutch legislation and hence, this legislation is in line with the European juridical framework. Indeed given the rapid development of communication systems and equipment, modular construction of smart meters would perhaps be preferable. However, it is up to the energy companies that are responsible for the acquisition of smart meters to formulate the exact specifications.

While a European-wide industry standard for AMI would be welcome, it should be noted that the train is already running. Because European member states have to implement the Directive on energy services and efficiency, they also have to think about the necessary requirements of smart meters. In the view of the Dutch authorities, standardisation from the start is essential in relation to interoperability and a well functioning retail market for energy supply. The realisation of a European-wide technical standard will take some years. By then, AMI will have been rolled out on a relatively large scale. Thus the challenge will be to create such flexible technical solutions that adapting the existing AMI systems to the new (regulatory or industry) requirements does not create problems.

For an overview on AMI in The Netherlands see Smart Energy International Issue 1 2007, p 32.