ESMA completes its work – final recommendations and reports published


By John Parsons

The European Smart Metering Alliance (ESMA) was started in 2006 and has now finished after three years of work.

The purpose of ESMA was to maximise the energy savings arising from any introduction of smart metering under the Energy Services Directive. It has now published all of its reports on the ESMA website. These include a Financial Toolkit to assist with cost benefit analyses, the latest version of the Smart Metering Guide, “Energy Saving and the Customer”, and its last Annual Report on Smart Metering Progress.

During its operation, the ESMA Alliance recruited 113 members who proved to be a valuable source of knowledge. ESMA held six international events for its members and other experts. These events proved very effective in bringing together a wide range of stakeholders from the metering industry, energy companies, consumer organisations, energy agencies, academics as well as government and regulators. The events were very popular and well appreciated, largely due to the wide mix of those attending and the focus on energy savings. It is hoped that similar events can be organised in the future.

ESMA developed three key recommendations that it believes are essential if smart metering is going to achieve the energy savings hoped for it. These are:

  • To ensure effective engagement with customers the energy industry should be incentivised to maximise customer savings as appropriate to their local market conditions. The energy savings effects of smart metering depend on achieving voluntary behaviour change in customers whilst it is the energy industry that will implement smart metering and will have direct control over what functionality is included. There are many options for smart metering and these do not all include energy savings and demand response features or have the same energy savings and peak load reduction effect. The energy supply industry must see a benefit from reducing customer energy usage and offering and implementing sustainability options, i.e. they need to benefit from reducing volume sales and from offering demand response and other services. 
  • The introduction of smart metering must be done in such a way as to protect consumers’ interests.

Energy savings from smart metering and information feedback depends on acceptance and understanding by consumers of the basic premise. It is vital that consumers are not prejudiced against smart metering by perceived unfairness or undesirable outcomes. Information on the impacts, costs and benefits to the customer resulting from the different options for smart metering should be made available to consumers and customer bodies. Consumer representatives must understand and accept the proposition. Smart meter data should not be used for purposes that are not accepted by the consumer or their representatives and smart meter data and systems must be secure from unauthorised access.

Consumers should receive appropriate benefits from any cost reductions achieved by the energy supply industry resulting from smart metering although this should not negate the financial drivers for the utilities. Finally, consumers must have options and some control over the implementation and operation of smart metering services. The introduction of new tariffs must be optional or agreed through consultation with regulators and consumer bodies.

  • Energy savings depend on providing customers with real time feedback, web-based information and better billing. All feedback routes are effective in different ways and complement each other and all should be included in smart metering schemes.

ESMA found that all forms of energy feedback are useful but that all have different applications. In order to support this, customers should be given a right of access to the meter data taken directly from their meter and smart metering functionality should include a local (non-proprietary) interface that supports the transfer of real time feedback data to displays and house automation networks. Electricity consumption data should be available down to 1 second resolution from the electricity meter and 30 minute resolution for the gas and water data. Energy agencies should be represented on the appropriate standards development committees to ensure that the necessary data items are available from the meter.

Over the three years of the project there have been dramatic changes in smart metering. Driven by the Energy Services Directive a number of mass rollouts are imminent and this can only be expected to accelerate in response to the 3rd Energy Package. Mandate M/441 has set off a mass of work by experts developing a full set of European standards, with the OpenMeter project running alongside. Technology is also maturing as manufacturers and meter operators get real life experience of running full systems. ESMA has worked to make sure that the requirements of energy efficiency don’t get forgotten in all this activity.

ESMA chart

Source: ERGEG: Status Review on Regulatory Aspects of Smart Metering (Electricity and Gas) as of May 2009, Ref. E09-RMF-17-03, 19 October 2009.

Most marked, though, has been the convergence of the smart grid, smart homes and smart metering. From an energy savings perspective, the way in which these applications are linked, and how new services are built across them, is going to be critical to growing energy savings and demand response.

One thing that hasn’t changed is the evidence base for the energy savings from smart metering. A number of major trials are close to completion and it is to be hoped that the data from these will be made available so that this important topic can be brought to some conclusions.

Nevertheless there are still a number of barriers that prevent the general introduction of smart metering, the most significant of which are that:

  • There remains much uncertainty about the quantification of benefits, especially related to energy savings, because practical experience and historical data are lacking
  • There are many parties involved, and the benefits of smart metering may accrue to other parties than the ones that bear the costs
  • Large scale rollouts of smart metering are very long and costly processes, requiring considerable capital expenditures from the responsible market actors. In many EU countries, there is strong opposition from regulators to increasing the tariffs to final users to pay for it 
  • There is still no interoperability between different owners’ assets as there are no open registered standards that properly scope all of the different functions (metering, communications, display, and network). The lack of adequate common requirements on functionality and open interfaces (interoperability) fractionalises the market and increases costs both for smart metering and for the applications and services that use metered data
  • There is also a lack of modularity and flexibility of present mass market smart metering products so that customising systems to meet the local requirements of distributed generation, demand response, power quality, customer information, energy efficiency automation and services, etc. can only be meet with high extra costs.

There are some follow ups to ESMA in preparation which will be advertised when they are ready. In the meantime, for any questions about ESMA please contact the author