Energy management on the horizon


In a boardroom somewhere, a utility CEO asks his four senior executives about what AMI means to them, and gets four very different answers! Strangely all the answers seem sensible! Is that possible? Well, yes it is, because it depends from where one views the question and that depends on what part of the business one is responsible for.

Be it retail, networks, generation, or finance, the challenge is to unify all the requirements from AMI, resulting in effective smart meter deployment. The different views are as follows:

  • Suppliers/retailers:
    • Accurate bills and consumption data
    • Detailed information on energy use and options to reduce consumption
    • New tariffs and products, e.g. time-of-use, carbonbased, consumption-based, load limited, with real “pay as you go” and other flexible payment options
    • Dynamic control of appliances with cheaper prices
    • Innovative ways for customers to serve themselves and links to the internet
    • Transformation of the change of supplier and moving house processes
    • New relationships between retailers and local authorities providing integrated electric car parking and charging infrastructure.
  • Finance:
    • Transformation of cost-to-serve and elimination of estimated bills
    • Transformation of the customer experience with reduced error and process times
    • Reduced bad debt and more flexible payment options
    • Extends the range of products and services into the home
    • Provides a strategic platform for carbon reduction targets and meeting other governmental supplier obligations
    • Remote connection and disconnection of supply
    • On-demand interval meter readings synchronised and time coded
    • A means to simplify complex competitive market processes.
  • Corporate affairs/government:
    • Facilitates the engagement of customers in energy use and potential CO2 reduction
    • Supports the potential for behavioural and technology driven energy efficiency strategies
    • Enables the requirements of the Energy End Use Efficiency and Energy Services Directive 2006
    • Provides macro-energy management opportunities should generating capacity shortages occur.
  • Network operators:
    • Reduces customer minutes lost in storm and other fault conditions
    • Improves fraud detection and enhances the management of technical losses
    • Will assist in the control of distributed and microgeneration
    • Will provide detailed power quality data and other information
    • Will provide detailed information to assist in the efficient use of network capital investment
    • Will provide greater flexibility for supply restorations and management of cold pick up, etc.

Although this boardroom scene is imaginary, the different views expressed are not and are indeed very evident today. As each day passes and another record price for oil is set, fears of rising energy commodity prices only exacerbate the requirements, challenges and urgency for smart metering. It is this challenge and pace of change that led PRI to develop its new Horizon™ solution. PRI seeks to demystify AMI and position Horizon™ as the future of energy management, both for the home and small business.

To explore and understand the thinking behind Horizon™ one needs to propel oneself into the future; say 2020. How will a day in 2020 look and feel? Let’s try the first few hours of New Year’s Day, and then go on from there!

Diary – 1 January 2020


00.01 to 10 am: Despite a great night, Daniel is up at 7am – showered, breakfast and cycle to local shops. Time 10 am.


10 am to 1 pm: Drive to parents’ house for lunch. Show Dad new electric car and tell him how it’s working out now that diesel is €20 per litre


1 – 3 pm: Trip to town for lunch – hooked up car to new integrated “Park ‘n Charge” point outside the restaurant. I can pay by the hour or the charging rate by phone or using my “master charge” card.

This emerging vision and perspective drove PRI’s 600 strong R&D team to develop the Horizon™ solution. This hope and determination, together with customer and utility attitudes both becoming increasingly proactive, gave added urgency to develop a multi-faceted perspective of the future of AMI.

For some observers this 2020 vision is not realistic and is overstated, but for others the opposite. But few in the early 1990s imagined oil getting to $100 a barrel. Between July 2007 and 2008, oil rose from $73.90 a barrel to $144.95. Even with the vision as it is, one can develop the dynamics from a “pre-set and forget” context to something very different. It is worth following Horizon’s™ thought process to this conclusion:

It was only in March 2007 European leaders signed up to a binding EU-wide target to source 20% of their energy needs from renewable sources, such as biomass, hydro, wind and solar power by 2020. On 23 January 2008, the Commission put forward differentiated targets for each EU member state, based on the per capita GDP of each country. Worldwide carbon legislation and carbon trading schemes are gaining momentum.

For the US and Europe oil consumption has stabilised around 40.5 million barrels per day. China, however, has gone from 6.4 million barrels per day in 2004 to 8 million in 2008, and it continues to rise rapidly.

Horizon house and car

Horizon house and car

There are still some big concerns about the economics of micro-generation but there is a resigned acceptance that the oil price will keep rising, so the proposition changes. Photovoltaic technology probably has the best chance of a real price breakthrough. According to Jeremy Leggett in a recent article, “Solar technology is advancing rapidly. Cells can now be made wafer thin and printed on aluminium foil. They can then be ‘wrapped’ on almost any object. American manufacturers claim this will halve the cost of producing solar cells.” This, together with some changes to building regulations or local planning laws, have the potential to transform the future for micro-generation.

Toyota has now sold more than 1,000,000 of its Hybrid Prius family cars. There are even waiting lists depending on the specification required. Views on congestion charging vary, but it is realistic to say attitudes as to what is not politically unacceptable today can change in the future. Look at American attitudes to their beloved gas guzzlers; smaller European cars are now seen as attractive!

An average electric vehicle will currently travel about 3 km for a kWh. Therefore say, 30 km a day, at 100% (yes, it’s unrealistic!) efficiency battery re-charge is a consumption of 10 kWh per day. Assuming it is not used at the weekends (yes, also unrealistic!), 10 kWh x 5 days x 52 weeks = 2,600 kWh per annum. An average customer’s annual consumption for electricity in many parts of Europe is currently around 3,300 kWh per annum. An electric vehicle covering 8,400 km per annum will increase, for this type of customer, the electricity consumption by a conservative 79%. Will energy for vehicles be tax free or have a differential tax rate to offset lost tax revenues from oil?

The potential of congestion charging to develop local clusters of electric cars on the local electricity distribution network is likely to cause local capacity issues. Therefore, despite clever tariffs at the generation level, there could be system constraints at the distribution level. This needs to be factored into the customer’s proposition and also within the Horizon™ customer protocols. Similarly, the options for load management in both directions, can take on a completely new approach if significant and stable capacity is available from sources of micro-generation. However, this opportunity becomes more difficult to realise as different political views pursue further unbundling and fragmentation of the total energy delivery/value chain.

As oil, micro-generation and electric cars evolve, so in turn will the options, controls and dynamics for Horizon™. The car’s battery becomes not just the source for driving the car, as, in sufficient numbers, it could provide a valuable system demand balancing mechanism and also alleviate some short term transmission constraints. For the customer, the car’s “tank of fuel” becomes a financial and demand instrument and an opportunity for arbitrage. For Horizon™ it must make the business of doing business, customer friendly!

We would surely have some sympathy for the CEO and his deduction that all the answers were right. Indeed, some of them overlapped and complemented each others’ aspirations. What PRI is doing with Horizon is pulling together the different stakeholders changing needs into a cohesive whole, delivering to each their own objectives.

Energy use in the future is going to be very different to the approach we take today. For the PRI team, Horizon™ will help make that next step on the world’s longest and most crucial journey just that bit simpler.