21 September 2009

Commissioner calls for moratorium on meter roll-out

"We need a moratorium on the roll-out of advanced electricity meters," said Dr Jan Wright, the Parliamentary Commissioner for the Environment. I have asked the group reviewing the performance of the electricity market to recommend a moratorium to the Minister of Energy and Resource".

The Commissioner was referring to her submission yesterday to the Ministerial Review of Electricity Market Performance 2009 being undertaken by the Ministry for Economic Development and the Electricity Technical Advisory Group.

“Retailers are currently installing only advanced meters, which lack the core technology that makes them really ‘smart’. The roll-out of advanced meters should be halted, until regulations are in place to ensure that these meters have a HAN-chip included and use the same communication standard,†said Dr Jan Wright.

“Regulating a communication standard makes sense in the same way as regulating electricity standards for 50Hz and 240 Volts,†she explained.

“I am concerned that unless action is taken, millions of dollars will be wasted, and the public will reject the really smart electricity meters.†In her submission, the Commissioner proposed amending one of the recommendations and adding another, to ensure that householders and the environment don’t miss out on the benefits smart meters can provide.

“Making an advanced meter ‘smart’ before it is installed will cost just a few dollars. However, upgrading them later will cost the householder around $150, because it will require a visit by a technician,†said the Commissioner.

Smart meters can help households use less electricity, which is good for the environment. “For example, reducing electricity use in New Zealand by five percent would reduce annual greenhouse gas emissions by an amount equivalent to taking around 200,000 cars off the road and could save households $125M per year†Dr Wright said.

“Smart meters can give you real time information about your electricity use cheaply and conveniently, for example by having an in-home display in your kitchen,†explains Dr Wright. “But more importantly, smart meters will be able to ‘talk’ to smart appliances, and some smart appliances are already available in New Zealand, with more to come.â€

There are advantages beyond just smart appliances. Indeed the greatest benefit from smart meters will probably come from their ability to coordinate the recharging of electric vehicles. Electric vehicles are expected to be introduced into the New Zealand market over the next 10 years. New Zealand needs to prepare for this or risk overloading local networks. Smart meters can play a crucial role, because they can communicate with the electric vehicles.

In her report Smart electricity meters: How households and the environment can benefit released in June, the Commissioner spelled out her concerns and recommended that the Government regulate immediately. The Minister for Energy and Resources indicated at the time that he would wait until the outcome of Electricity Commission review in December before making any decisions.


Background - What are these new electricity meters?

New Zealand retailers are in the process of rolling-out advanced meters, which are not the "smart" meters they are sometimes described as. New electricity meters are essentially "computerised" and provide retailers with real-time information about a household's electricity use. Ten percent of households already have advanced meters. In three years, more than half of New Zealand houses will have advanced meters, based on current plans.

However, advanced meters have limited benefits for anyone other than the retailer. For example, the retailer can save money through remote meter reading and gains access to rich customer information.

If an advanced meter is also Home Area Network (HAN) functional, it then becomes what I regard as a "smart" meter. A smart meter can communicate with other devices within the home, e.g. smart appliances and in-home displays. A household with a smart meter will be in a much better position to reduce its electricity consumption.