Smart Meters – A need of the day

Since the inception of electricity deregulation and market-driven pricing throughout the world, utilities have been looking for a means to match consumption with generation. Traditional electrical meters only measure total consumption, and so provide no information of when the energy was consumed at each metered site. Smart meters provide a way of measuring this site-specific information, allowing utility companies to introduce different prices for consumption based on the time of day and the season.

Utility companies have proposed smart metering from a consumer perspective, offers potential benefits to householders. These include:

• An end to estimated bills, which are a major source of complaints for many customers
• A tool to help consumers better manage their energy purchases – stating that smart meters with a display outside their homes or meter dash board on consumer mobile could provide up-to-date information on electricity consumption and in doing so help people to manage their energy use and reduce their energy bills.

Electricity pricing usually peaks at certain predictable times of the day and the season. In particular, if generation is constrained, prices can rise if power from other jurisdictions or more costly generation is brought online. Proponents assert that billing customers at a higher rate for peak times will encourage consumers to adjust their consumption habits to be more responsive to market prices and assert further, that regulatory and market design agencies hope these “price signals” could delay the construction of additional generation or at least the purchase of energy from higher priced sources, thereby controlling the steady and rapid increase of electricity prices. There are some concerns, however, that low income and vulnerable consumers may not benefit from intraday time-of-use tariffs.
An academic study based on existing trials showed that residential electricity consumption on average is reduced by approximately 3-5 per cent. Also, studies show that smart meter implementation will result in reduced CO2 emission, improved renewable energy usage and energy efficiency by 20 per cent.

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