The sizeable savings would arise from reducing losses in the electricity distribution network through automation and encouraging consumers to cut energy consumption with smart meters that provide more accurate and timely information, experts from the Smart Energy Demand Coalition said at its launch yesterday (15 November) in Brussels.
Utilities will also be able to lower the system voltage level and make meter-reading redundant, argued Chris King, chief regulatory officer at eMeter. After deducting necessary costs like the installation of smart meters and new software, the net benefit would still be €31 billion per year, he said.
The new coalition includes members like electricity utilities ENEL and EDF, technology companies Landis & Gyr and eMeter and think-tank VaasaETT. Modelled after a similar association, the US-based Demand Response and Smart Grid Coalition (DRSG), it aims to inform policymakers about developing smart grid policies and publicise the benefits of smart energy demand.
Smart metering solutions will allow the introduction of time-based tariffs and provide consumers with information about their electricity use in real time. But installing the equipment in each household will do nothing unless consumers are given adequate information about how to make use of them.
Europe is currently spending billions of euros on developing technologies requiring smart grids, including wind and solar generation, electric vehicles and heat pumps. But in comparison to these funding and standardisation efforts, little attention is paid to developing demand-side programmes that will reduce energy consumption, the coalition members pointed out.
"The political recognition is there but everybody keeps asking 'show me the numbers'," said John Harris, vice-president of global leader in smart metering solutions Landis+Gyr. While the industry can convert the benefits of smart metering and intelligent grids into figures, the EU still faces a regulatory gap that has not been closed by its 2020 climate goals or the third energy package, which requires smart metering systems to be fitted into 80% of homes by 2020.
"The first thing we need to do is to define what an intelligent system and meter is," Harris said. Here, the functionalities of smart metering identified by European standardisation bodies working under an EU mandate are a good starting point, he argued.
Another problem will be solving the question of who pays for the roll-out of smart meters, which is more complicated in a liberalised market like that of the EU, Harris added.