Central & Eastern Europe’s smart meter market – not ‘if’, but ‘when’


Milan Kalal,
Senior Research
Analyst, IDC Energy
Interview with Milan Kalal, Senior Research Analyst, IDC Energy Insights

A number of countries in Central and Eastern Europe (CEE) have, thus far, shown very little interest in investing in or supporting smart meter deployments and smart grid updates. What needs to change in these countries to promote greater government interest?
Smart metering is not a question of "if", but "when". Utilities demand flexibility, with options that do not lock them into a single technology or solution (i.e. interoperable interfaces enabling future system updates and interconnectivity). System and data security will continue to play a key role.

Several drivers are at force supporting the smart metering market in Central and Eastern Europe, including the need to integrate renewable energy sources in the grid, to replace the aging infrastructure, and to optimize energy consumption. However, the market continues to be negatively affected by macroeconomic challenges, as well as delays in national regulatory frameworks. The complexity of the issues pertaining to smart metering – financing, privacy, security, and so on – has made national discussions challenging, particularly as such discussions need to result in sound national regulatory and legal frameworks to guide the rollouts.

Compared with Western Europe, many would see the CEE region as some years behind. Do you see it this way, and if so when do you think more balance will exist between the two regions?
An EU provision from 2009 mandating the rollout of electricity smart meters by 2020 has turned Europe into one of the most promising smart meter markets. However, IDC Energy Insights’ smart meter tracker shows that market growth in Europe generally has proven to be slower than expected. Only Spain and Finland are currently implementing full rollouts. The majority of CEE countries are still testing the technology and/or completing national regulatory frameworks.

In Central and Eastern Europe, tender activity will pick up in 2013, but actual smart meter shipments are unlikely to increase dramatically during the year. Regional disparities within Europe will continue in the medium term, with meter deployments in Western Europe driving growth.

Do you feel that any utility companies in particular are leading the way in the smart energy transition in CEE?

In Central and Eastern Europe, smart metering market activity is expected to pick up in 2014 or 2015, when utilities in Estonia and Poland will be the most active in smart meter deployment.

How much importance do you feel utilities in the region are placing on customer engagement strategies?
Utilities will increasingly perceive smart meters as platforms to enable new customer services and customer engagement, focusing on functionalities that support smart grids downstream from the meter – facilitating services in the area of home energy management.

Practice has shown that consumer engagement should not be taken for granted, partly due to the fact that different customer groups behave differently and tend to respond in different ways to the provided information and incentives.

At present, given the limited progress of smart metering across the CEE region, consumer engagement is not yet the primary focus of utilities’ investments. In future, utilities will put greater emphasis on home area network gateways to ensure the future benefits of smart metering are fully reaped on the consumer side.

IDC Energy Insights is a Supporting Association at this year’s Smart Utilities Central & Eastern Europe 2013. Milan Kalal will be chairman of the session “Innovations and Developments in Smart Energy Infrastructure” on Tuesday, May 14.