Cleantech Market Intelligence
The UK Smart Meter Project: Will All Have Prizes?
Two announcements on Monday served as a reminder that the UK smart metering market is one where all bets are still on. On the supplier side, Cable&Wireless Worldwide and Current Group announced a partnership to offer integrated smart meter and smart grid solutions to the UK market based on the C&W extensive business communications infrastructure and Current’s smart grid sensors, smart meter data collectors and analytic software. Meanwhile the UK government published an update on the consultation phase of the UK smart meter project and also announced some changes to the governance of the project.
To recap, the UK will see a mandated deployment of 48 million electricity and gas smart meters to 27 million homes, in one of the most open and competitive markets in the Europe, if not the world. The national rollout is set to begin in 2012, but a significant number of meters are likely to be deployed before then.
The UK market has some unique features and the market approach taken by the government adds further uncertainty as to which technologies will be most successful. Apart from the highly competitive nature of the market, interest in the UK’s approach has been increased by the government’s plans for a new organization to manage a national communications infrastructure. A new regulated body, DataCommsCo (DCC), will be responsible for tendering and managing communications services that will support all smart meter deployments across Great Britain. However, the shape of that infrastructure and the commercial model that will support it has yet to be defined.
During research for our forthcoming Smart Grids in Europe report, few issues elicited as divergent a set of responses as the question of what would happen to smart meter communications in the UK. As a reminder that this is still a battle worth waging, the government’s update on the consultation phase confirmed that it has seen “a very strong appetite in the marketplace from companies seeking to become DCC, or to become service providers to DCC”.
While some utilities and suppliers are waiting for greater clarification others are making strong initial moves. British Gas has grabbed the headlines with plans for 2 million meters to be rolled out before the end of 2012. The argument from British Gas is that the benefits are too great to wait and the sooner it can get experience of roll out at scale the better prepared it will be. British Gas is of course hoping that it will create a default model for smart metering in the UK – but it’s not certain that will be the case.
So far the main alternative to the wide scale use of GPRS has come in the proposal from the SmartReach consortium formed by BT, Arqiva and Detica. The consortium is seeking to leverage Arqiva’s network of 16,000 radio towers to deliver a national communication infrastructure for the smart metering and smart grid applications. The consortium has been working with other partners on a smart grid proof of concept network in the UK with a network covering around. 200,000 homes. As well as electricity, gas and water meters, the project has also piloted support for distributed automation services.
In comparison, PLC technologies, dominant in the other main European markets, seemed to have been left in the cold. One challenge is that unlike most European countries, UK metering is the responsibility of the retailer not the distribution network operator and so there is a disjunction between ownership of the distribution lines and the meter. Together with the early lead taken by GPRS solutions, this has led some suppliers to have already discounted a significant opportunity for PLC technologies in the UK.
The announcement by Cable&Wireless Worldwide and Current Group shows that not all agree. The partnership will use the open PLC-based PRIME metering standard, developed initially for Iberdrola’s project in Spain and now being driven by the PRIME Alliance. The impetus being provided by the roll out of next generation PLC technologies in Spain and France might yet make it a serious proposition, at least for parts of the UK. Even British Gas has said that GPRS won’t reach all it customers and it will consider other technologies as necessary.
The outsider in this race remains RF mesh networks, popular in the U.S. but constrained by spectrum limitations in Europe. But even these suppliers haven’t given up the UK battle entirely and were able to convince a parliamentary committee to recommend that spectrum be made available for smart meter communications (though that doesn’t mean it will).
So it still remains far from clear how the UK’s smart meter communications landscape will evolve. Both the initial deployments of GPRS solutions and the ambitions of the SmartReach consortium would suggest a winner takes all result, but I would still bet on a diversity of solutions proving more attractive than any single technology.