2014 is set to be an interesting year for the energy industry. Why?…because that is the yeat that Smart Metering begins to roll out to all households and businesses in the UK. You will experience the change as both a business and domestic consumer.

Guaranteed Savings!

Not so fast. The introduction of Smart Metering is percieved by some as the start of reduced bills thanks to more real time data and the ability to understand your usage on a daily basis. Well, sorry to disappoint but the emphasis will still be on the business or household to use the live data to monitor and assess where bills can be reduced by switching off, conserving and limiting energy use. Switch off that light, wear a little more clothing in the office so the heat can be turned down a notch and ensure that PC monitors are energy saving with PC’s that are easily turned off.

Concerns from Business Customers

With all the hype and focus on the positive side of smart metering, there is some concern from the business community as to who will be paying for the installation and the technology itself. Businesses know only too well that theres nothing given for free and their concerns are valid but their questions currently difficult to answer.

Businesses just do not believe they will get a good deal out of all of this as they feel that Smart Metering is being imposed on them with no real incentive. Many are unaware that Smart Meters have been pushed out there to satisfy some of the energy and low carbon policies put in place by the Government.

“Stranded Hardware”

Smart metering has faced some difficulties in its implementation within the UK due to the unbundled market. Additionally, suppliers are anxious about stranded assets if they invest in more costly meters only to lose the customer to a competitor. The research of the Energy Retail Association suggests that this relates to both the lost asset value of the existing meter and the potential for new meters to be ‘stranded’ when a customer changes supplier. Apparently the answer for suppliers has being to launch an exercise for agreeing within the industry on a common smart meter specification and interoperability rules to overcome this challenge. The purpose of this is to provide for the transfer of the meter asset when a customer switches Supplier. This would be made possible by ensuring that the new meters are functionally identical, regardless of manufacturer so that suppliers are able to adopt the meters without having to visit the site.

Potential Increase in Flexibility and Liquidity of the Energy Market

Previous research has show that changing electricity supplier in a deregulated electricity market can be, and is definitely perceived to be, a complicated technical procedure, requiring exchange of different data, including metered data for the switching Final Customer, between several market players. One of the core functions in Smart Metering is a possibility to request accurate metered data from a metering point at any time. The research explain that smart metering allows the business user to shorten or possibly to automate energy supplier switching procedures and to reduce the hassle and costs.

It also makes it easier for electricity suppliers to gain metered data for potential customers and make better electricity contract offers to them – (Morch, Parson and Kester, 2007; 194)

Supplier Concerns

It’s not just the business energy customers that have concerns – suppliers are concerned by the change to Smart Metering and their concerns include:

• Interoperability vs Innovation ; which refers basically to what is going to be more important within the energy market: to have one homogenous type of device able to everyone to operate or to continue innovating in the development of smart meters
• Ability to deliver benefits to all of market ; this is to everyone get the benefits from the introduction of smart meter ( accurate data, better packages; improving liquidity within the market)

In Conclusion

Smart meters are an opportunity for business to improve their energy management and to have an efficient management of their energy expenses. It allows businesses to obtain detailed energy information when dealing with suppliers and ensuring they get the right deal for the right price. Also smart metering will facilitate suppliers to gather data about consumers’ behaviour and to improve their packages. Finally, and equally important, is that smart meters are part of the low carbon policies introduced in the UK, thus, they are a key part in the development and management of a more sustainable energy supply.

For more details regarding smart meters for your business call Torse on 0115 853 2120, use the CONTACT FORM or email us at info@torse.co.uk