Smart Meters

IBMThe topic of the moment for UK Utilities is Smart Metering as the Government plans to mandate the roll out of Electricity and Gas meters by the end of 2020. This roll out will have a major impact on the way Utility companies do business and the technology they use. Some commentators are even saying it is potentially as big a change to the IT systems and business processes as market liberalisation was in the past.
This level of change is driven by two factors:

Business System Connection

To make the most of the new smart meters functionality, Utilities need to connect the systems used across an enterprise in a host of new ways. Example ways of connecting include call centres linked directly to their customers meters, network control centres able to see how their networks are loaded and which customers are unconnected, marketing departments able to target tariffs to individual needs, local dynamic load management, and much more consumer involvement in the management of energy.
As the world becomes more instrumented and interconnected increased intelligence needs to be applied to the technology that allows us to deal with the challenges faced. Smart meters are a perfect example of providing this increased intelligence. However just replacing mechanical meters with smart meters does not make the way we use and deliver energy smarter. It is how the data the meters produce is used that makes the difference. Ensuring the meter data is made available throughout the organisation, and that it is used to improve the way that operations and services are provided will create opportunities for the companies involved.

Data Volumes

On data volumes the maths is simple -even with no increase in the detail retrieved, moving from quarterly meter reads to one every 15 minutes multiplies the data volumes by nearly 9000. When the additional data that will be available is added, this ratio can go up even further. This change impacts not only the amount of storage required, but also the infrastructure to pass this data between applications, and the capacity of the applications.
Applications that were previously unconnected now need to be connected to gain competitive and business advantage. These connections and the change in data volumes alters the dynamics and loading of the infrastructure, for examples architectures need to be capable of handling these changes using Service Orientated Architecture. However it isn’t just the connections and data volumes that are driving this change, its also the change from undertaking processes in a batch manner to doing them in real time.
The most obvious change will be around billing as estimated bills will no longer be required. This will substantially change the Retailers billing systems and the workload of Retailers call centres. Now the call centre needs to be connected directly to the meter so the operator can see exactly what the customer sees, and can also switch on and off the supply, for instance during home moves.

Value of Data Analytics

This increased level of connectivity will also impact the network operators.
For a network operator a wide range of opportunities arise from linking up their systems to real time access to the meters and the use of historic data.
Firstly there is the opportunity to handle outages better. Knowing exactly which meters have lost connection allows the likely location of faults to be identified quicker, allowing them to both reduce the duration of outages and reduce the work required to identify and fix the problem. The opportunity also arises to be more proactive and call customers to acknowledge they have lost connection and give them an indication of when they will be back online.
Secondly knowledge of the data flows at the end points will enable a much better understanding of the loading of different components of the network. When this is combined with better asset management systems and Geographic Information Systems it shows
the real value of data analytics. There have been many recent technological developments in this area, including the latest ideas around stream processing.
Retailers will have the opportunity to have a much better understanding of their customers and answer questions such as:-
  • Who are my most profitable customers?
  • What new products would be best suited to the lifestyle of this customer?
  • How can I structure tariffs to attract the best customers
  • How can I structure tariffs to improve the profitability of the least profitable customers
To get the benefits of Smart Metering this information needs to be presented to those that need it, for instance to customers so that they can see and manage their energy usage. Whether this is through in home displays presenting information taken directly from the meters, energy management services provided on the web, enhanced analytics presented on the bills, or in some other innovative manners. All these ways of providing added value to the customer will need access to historical and live data in ways current systems may not be able to support.

Future developments – growing importance of water management

Whilst the focus has been on Electricity and Gas metering it is important not to ignore Water. There is growing value to implementing Smart Water meters so that tariffs can be introduced that encourage consumers to change their usage to times when there is capacity and also when the energy and chemical processing costs are lowest. Deploying an infrastructure for the rollout of Electricity and Gas smart meters opens up the potential for linking in Water meters in the future.
The advent of Smart Metering will fundamentally change the IT architectures of utility companies. Those that are best prepared to handle the challenges and opportunities that this greater insight into their customers and infrastructure will bring will be the ones who become leaders. Utilities need to evaluate the capacity of their existing infrastructure and start making the changes and ensure they take advantage of the latest technological developments so that they are the companies who gain most from the paradigm shift that Smart Metering will bring.

Gavin Jones is North East Europe Leader for Energy & Utilities at IBM.
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