Can not-so-smart meters help the NBN?

Can not-so-smart meters help the NBN?

Summary: It was interesting to witness Conroy's recent enthusiasm to spruik the NBN's role in supporting the Smart Grid, Smart City initiative. What a pity that Conroy hadn't yet seen the damning report from the Victorian auditor-general about that state's smart-meter roll-out.

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Stephen Conroy's choice to front up to the recent launch of Smart Grid, Smart City initiative — a commercial-grade "smart grid" that manages energy more efficiently than current distributor-centric systems — was a curious one.

But there he was, standing with Resources Minister Martin Ferguson and Environment Minister Peter Garrett not for a rousing rendition of Blue Sky Mine, but to spruik the NBN's role in supporting the $100m utility network.

After Garrett called smart grids an "energy internet", Conroy said the NBN will "enable a whole range of efficiency and productivity gains across the economy ... this smart grid project is an important start point as we move to ensure Australia gains maximum value from our broadband investments".

Government bodies have been linking the smart grid and the NBN for years, trying to build up the network's next-generation cachet and its role as a facilitator in all kinds of industries. What a pity that Conroy couldn't have seen the damning report from the Victorian auditor-general, which has closely examined Victoria's nation-leading smart-grid roll-out and found it wanting in many ways.

(Smart meter image by EVB Energy Ltd, CC2.0)

The smart grid in Victoria, where a host of companies are planning to push interactive "smart meters" out to 680,000 households by 2013 — seems to be yet another case of wishful thinking and head-in-the-clouds policy-making. And while that's not always a bad thing, in this case it doesn't seem to be helping. The auditor-general slammed the state's recent smart meter technical trials as poorly managed, badly scoped and improperly monitored — and questioned why some $6 million was spent testing technology that's still too immature for general deployment.

That can hardly bode well for Smart Grid, Smart City, which was meant to be yet another touchstone in Conroy's never-ending quest to talk up the NBN's prospects. Yet with high temperatures buffeting Victoria and much of Australia over the past weeks, smart meters and smart grids are on the minds of power authorities — and home owners are justifiably wondering just how much they're going to be socked for all these political playthings. Remember free citywide Wi-Fi? Remember Conroy's web filter? Heck, remember Petrol Watch?

Smart meters and smart grids are on the minds of power authorities — and home owners are justifiably wondering just how much they're going to be socked.

Home owners, after all, will directly or indirectly wear the costs of installing the smart meters, which are supposed to reduce the often ridiculous charges that electricity distributors pay generators during demand peaks. For their trouble — and for the expense of a taxpayer-funded NBN connection — consumers will get higher bills and a chance to reduce them back to current levels by washing their dishes or clothes in the middle of the night rather than the hours people are normally awake.

Industry authorities talk dreamily about the day when they can control everybody's appliances over the NBN, powering air conditioners and other devices on a rotating basis to normalise input costs and better match demand and supply curves. They've even created a Smart Networks Committee within the Energy Networks Association (ENA), which has actively engaged itself in the government's NBN legislative review (PDF).

The NBN's role in this smart grid paradigm is mainly to provide two-way communications to every household in Australia — making it relevant more for its ubiquity than its massive capacity. Yet given the auditor-general's conclusion that the Victorian roll-out isn't even commercially viable, one wonders whether the smart grid can evolve from being a vague conceptual goal to an actual revenue generator. Where is the money in shuttling tiny packets of smart meter data back and forth?

Harry Kestin, energy industry business manager with location systems specialist ESRI Australia (which supplies geolocation services to help utilities track smart meters and other physical assets), believes smart grids offer potential but said Victoria's approach has been half-baked from the beginning.

One wonders whether the smart grid can evolve from being a vague conceptual goal to an actual revenue generator. Where is the money in shuttling tiny packets of smart meter data back and forth?

"There are massive implications for the use of these meters, both in terms of governance and how information is provided between the various regulatory bodies," he explained. "The business case is ultimately going to have a much broader scope than Victoria's: for example, one part of the smart grid is to enable distributed generation, so consumers can generate electricity and feed that back into the grid."

"But the Victorian version is a relatively cut-down version of that," he added. "The roll-out in Victoria is a simplified version, and the other states are waiting for Victoria to pilot it and make the major mistakes."

And here they are: the dismal report card from the auditor-general casts serious doubts on the approach currently being taken. This, in turn, does not bode well for visions of the power company automatically turning on and off dishwashers, washing machines, and air conditioners from afar.

At the very least, the kind of NBN-attached smart meter network so many people envision is impossible without appliances that can communicate over a wide-area network. In a country where nearly half of households still haven't shelled out $50 for a digital set-top box, can we honestly support a business case built on the theory that consumers will shell out for brand new, globally connected appliances that don't even exist yet?

The whole idea is fanciful: smart meters, as we all realise, are nothing more than a way of boosting utility company profits by getting consumers to pay more for the energy they're using. Or, as the report concluded, "in order for consumers to benefit from the cost savings, the distributors will need to pass on the savings through to retailers who will need to pass on the savings subsequently to consumers."

Fat chance — especially when there's going to be an NBN to pay for.

Can smart meters ever actually benefit the customer? And can they really be expected to cost-justify the NBN, even in small part?

Topics: NBN, Broadband, Government AU

About

Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

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4 comments
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  • Smart Meters.. Smart for power companies

    Your last paragraph says it all. While smart meters are talked about in terms of reducing power consumption, reducing cost etc. this is just greenwashing an insidious product.
    With that level of control over power usage, the distributors are never going to use it in the consumers benefit. It's all to save costs, and boost profits.
    They'll start slowly. First they will offer a lower tarrif to be able to control your pool pump. Most people will go for that.. then they will ask the legislators ot make it law. I mean, it's all to reduce green house gases right? And prevent massive network upgrades which could be better spent on green power initiatives right? Then it will be your air-con, that nasty device that causes massive issues on the supply network. And it will be a slippery slope from then on, to the point where you no longer can acutally expect anything to work all the time.
    Personally, i think at the air-con stage it will fail. Ineveitably they will turn of some old blighters air-con in the middle of a heat wave, and the poor old person will die. There will be an outrage, and the community will realise just what smart-meters have done... Take control away from the consumer, and placed it fairly in the hands of greedy corporates.

    Smart meters that offer different tarrifs for different products are one thing. The moment you breach into the area of being able to remotely turn off decvices, you are walking into very dangerous territory.
    anonymous
  • The whole bloody saga is a joke

    It makes me think that a life like Grizzley Adams can be fulfilling and worthwhile. The corporate sector is so entrenched with holding the nation to ransom that a lot of people will soon ask whether a progressive modern lifestyle in an industrialised country is worth the bother or not.

    The idea that electricity charges will double in five years is also a joke. What do we get for that? The same number of blackouts, poor customer service and unreliable billing systems - ah la AGL.
    anonymous
  • Smart Meters - Big Brother

    They are actually S.M.A.R.T. Meters: Slowly Making Australia Rigidly Totalitarian.

    When will the Victorian Government be installing CCTV in everyone's homes? I'm bending over as we speak, waiting for the Victorian Government to come and probe me....

    I think these new meters are insidious. The first 40 - 45 degree day we get they will be shutting off our power to stop us trying to cool down with our air-conditioners.

    I don't think people power will stop this. The Victorian Government doesn't listen to it's people (until it's too late). Even Kevin Rudd is refusing to acknowledge the growing number of studies showing that global warming may not be man made (with some suggesting our emissions only contribute 6% at most).

    At least once Melbourne becomes more expensive than Tokyo the population growth may slow down.....
    anonymous
  • Get Smart

    I have a dream. News flash from TV China -a massive effort is underway to rescue two trapped miners. An official communique from the CPR says; "We spent a fortune unearthing a terracotta army. Do you think we will let these warriors of the worker revolution rot"?
    What am I smoking! We know that in the coming year thousands of Chinese miners will die in tortured silence, just as thousands of Indian villagers will die agonisingly from snakebite. It wouldn't be tolerated for a minute in western society.
    The difference is that your life and mine (to say nothing of our children) is more valuable than the aforementioned. Where wealth (Addicted to Money) is the sole means of exchange the most grotesque anomalies arise. A financial executive rewards himself with millions of dollars for a half baked scheme that brings destitution and ruin to thousands. Meanwhile a nurse works back to back 9 hr shifts in the stench of incontinent patients (your Dad, my Mum) with generous compassion and earns a pittance.
    Perhaps the Greens (presumably unwittingly) have provided a more equitable measure -our eco footprint. Packer jnr might be complacent at the label 'wealthiest citizen'. He (and importantly his offspring) less so with 'they produce more pollution than an entire street of urban families'. But think positively. A housing estate, aided by Govt initiatives, could reduce its energy consumption. It could then onsell the credits (the appetite for the rich for energy is insatiable) and invest the proceeds in playgrounds or support for children before they commence formal schooling. The marginalised would see themselves as important contributers to the eco revolution.
    David; do you have the ear of any Libs? Tell Malcolm to take a shower. Penny and Kev will dig their own political graves. What we need is a leader who will embrace sustainability (Carlo Petrini, doyen of the slow food movement calls it 'austere hedonism') not because of dubious science but because it is ethical. How can a people who aspire to a fair go leave 80% of the world to sift 20% its resources?
    Smart meters? I'm all in favour as long as they enhance my quest for austere -hedonism. If they try to disenfranchise me, placing my destiny in the hands of the politico industrial complex, then; Over my Dead Body! In another life as a classroom teacher I would introduce the concepts of solar and alternatives. Always a buzz to see the excitement of the kids as energy was conjured out of nothing. My peers labelled me odd, quirky and even downright deviant. Almost surreal to see these things become so 'totally in'. Wake me in forty years when the miner and the villager are lauded as the true heroes of the eco revolution -because their eco footprint is miniscule compared to our own. Being old, being trite does not necessarily mean an untruth. So as the song goes; The best things in life REALLY are free.
    anonymous