Thinking smart on energy savings

Stephen Cunningham, BBC Green Room 19 May 09;

Smart meters will play a central role in delivering an energy infrastructure fit for the 21st Century, says Stephen Cunningham. In this week's Green Room, he argues why he believes the technology will help deliver the necessary carbon saving needed to prevent dangerous climate change.

If time waits for no man, climate change is even more ruthless.

Yet people in the UK, along with much of Europe, have been waiting for years for the intentions of government and its increasingly ambitious carbon reduction targets to be reinforced with decisive implementation plans.

Last week, that wait came to an end - at least in the field of energy management.

Industry has finally been given the backing it needs to unlock the potential of "smart metering".

And it has been a long wait. The idea was first mooted back in 1994 as a relatively "easy win" in addressing climate change, and it later featured in Gordon Brown's 2006 Budget speech.

The fact that the UK government's full support for a national roll-out of smart meters to all UK homes and businesses has been a long time in coming should not detract from the enormity of this decision.

The announcement by the Department of Energy and Climate Change (Decc) represents an important turning point in UK energy policy.

It heralds the advent of the "smart grid" - a potentially more profound step than North Sea gasification, according to many commentators.

The energy industry now has both the directive and core information it needs to prepare for the work that will make the UK a worldwide pioneer in smart energy management.

Industry and government must work hand-in-hand to seize the momentum and develop both the standards and delivery network required to meet the ambitious target of fitting 49 million meters in 27 million homes in little more than a decade.

21st Century solution

"Smart" electricity and gas meters provide utilities with a secure, two-way flow of data that allows them to manage demand, protect the distribution network and ultimately optimise energy generation.

Consumers benefit from being able to manage and reduce their energy bills, and, crucially, their household's carbon footprint.

Put simply, what you can measure, you can manage.

On the whole, the measurement of energy in the UK relies on a system introduced in the 19th Century, whereby the meter calculates a customer's aggregated energy use each quarter, or in many cases across an entire year.

Smart meters, however, provide highly accurate usage and cost information directly to portable in-home display units, providing consumers with up-to-the-minute information about their energy consumption and how much it is costing them.

By clearly communicating the cost of every day actions, such as boiling the kettle, consumers are empowered to act.

The impact of the UK government's decision should not be underestimated.

To achieve the EU's noble vision of a 20% increase in energy efficiency, a 20% increase in renewables and a 20% reduction of CO2 emissions - all within 12 years - will be a massive undertaking.

Smart metering is one of several essential ingredients in the realisation of this vision.

In itself, it is by no means a panacea, but none of the "20:20:20" goals are remotely achievable without a functional smart grid underpinned by its prerequisite: a smart meter infrastructure.

Last month, the European Parliament recognised this with a definitive mandate for the roll-out of smart meters in all EU Member States by 2022, achieving 80% coverage by 2020.

The UK now has the opportunity to lead the pack.

No-one can be sure of the precise energy savings that a nationwide smart meter deployment will bring the UK because the transformation is unprecedented.

However, we can be absolutely confident that the savings achieved will be substantial.

Research published last year in Finland found that in-house displays brought average energy savings of 10.3%.

Another 2008 paper, from the EU Commission, estimates 7% energy savings for households and 10% for businesses. More conservative estimates point to between 3% and 4% - a valuable prize nonetheless.

But the advantages are by no means limited to the empowerment of the homeowner in the fight to reduce carbon or the end of estimated billing.

As energy prices spike, the search for energy security intensifies and fears of "brown outs" grow, smart meters will play a crucial role in the move towards renewables.

The current European grid was built mainly after World War II and was designed for stability.

Times have changed - not least with the exponential proliferation of energy-hungry consumer devices and the advent of the electric vehicle.

Utilities companies agree that the grid itself must shift with the times and move into the digital era.

Smart metering provides utilities with the information and flexibility required to manage intermittent electricity supply from renewable and micro-generation sources, allowing them to balance this with more traditional, consistent supply.

If the UK is to truly embrace alternative energy, smart meters will be an essential part of the process.

Although the task ahead for the UK is huge, the goal is absolutely fundamental for our society and its long-term value is of historic proportions.

Real encouragement can be taken from a growing pool of ground-breaking European smart energy projects, which are delivering tangible benefits in the here and now.

These include the 30 million smart meters recently deployed across Italy, and EDF's trials in France which could lead to the deployment of 35 million meters.

The UK is now set to become even smarter.

Stephen Cunningham is UK & Ireland chief executive for Landis+Gyr, the world's largest smart meter system manufacturer

The Green Room is a series of opinion articles on environmental topics running weekly on the BBC News website