If successful, smart meters connected and integrated with a Smart Grid will have as great an impact on how we consume energy as the internet did on how we consume information.
The internet transformed both consumer behaviour and business models with a host of highly agile market entrants. Many of these entrants built billion pound businesses by responding rapidly and effectively to new forms of consumer demand.
The same kind of opportunities can be realised from the transformation to a smart infrastructure in the energy sector, however the challenges in securing benefits are significant.
The UK Energy Retail Association states that the roll out of smart meters will be the largest project the energy market has seen since the conversion to North Sea Gas in the 1970s. It will affect 27 million homes and two million non-domestic sites, requiring smart electricity and gas meters costing approximately £10 billion.
Globally challenges surrounding this transformation are becoming evident. For instance, in Boulder, Colorado, USA, a segment of the consumer base which actively sought a Smart Grid is coming to terms with what management of their home appliances actually means. In addition, technology costs are reportedly heading towards triple the original estimate.
This highlights the need to help consumers understand the benefits available to them from smart meters and how to modify their energy consumption behaviour to secure those benefits. Equally, Smart Grid developers need to meet the challenges of relatively new technology that in most cases is not yet selected, trialed and woven into a complete business change programme. This means the business case will be complex, particularly for a deregulated market like the UK.
Yet energy leaders moving towards a future with smart infrastructure have a huge business opportunity. The shift allows them to take their business onto a ‘real-time’ footing, offer billing to the kilowatt/second, and deliver online energy management services for consumers. They can look beyond meters and the grid to the potential applications of electric vehicles and micro-generation to meet the needs of smarter consumers of energy.
In order to do this, organisations have to answer questions including; Have we got the right IT infrastructure in place? How do we ensure consumer privacy is protected? Are my consumers ready for a smart meter?”
The essential elements to securing the benefits of smart meter and Smart Grid implementation are set out in PA's Connecting the Smart Grid DotsTM strategy. This outlines how to:
- engage key stakeholders
- identify interdependencies between benefits and smart meter and Smart Grid activities
- clearly communicate the Smart Grid strategy
- demonstrate a roadmap towards how the Smart Grid strategy can be achieved.
If these elements are in place, then it is possible to realise the true benefits of smart infrastructure and transform the way we supply and consume energy.
Please click here to find out more about connecting the dots of your Smart Grid strategy and developing your roadmap to a future with smart energy, or contact us now.