Machine-to-machine technology is set to have the greatest impact on smart metering in the coming few years, says Erik Brenneis of Vodafone Global Enterprise
Machine-to-machine communications, otherwise known as M2M or telemetry, connects communications-enabled machines or devices, enabling key information to be exchanged automatically. And take up of these services looks set to grow dramatically over the next few years, as individual industries become more aware of the benefits to both service providers and end-users alike.
In the automotive sector, for example, the EU is set to demand that all new cars incorporate a connection that will send an emergency “e-call” message to a service centre in the event of a crash. This is expected to save a large number of lives, especially where accidents occur in remote areas and where an immediate medical response is critical.
In addition to this, wireless M2M services within a car can provide a huge range of potential uses to enhance the driver experience including areas such as remote diagnostics for mechanical issues, enhanced automatic navigation aids, in-car internet services and entertainment applications.
Yet the area where M2M may well have the greatest impact is that of smart metering. And once again, this is driven by regulatory pressure, as EU legislation will require the availability of smart electricity meters in all homes within member states by 2022. This is certain to be followed by other utilities such as gas and water, as part of the broader development of the “smart home”.
Although still in its infancy, the future for smart metering looks assured.
M2M services hinge on installing a hard-wired SIM card within the device. In the case of the utility industry, this enables electricity or gas usage to be read remotely. This provides the utility company with a number of benefits. Efficiency is improved, as estimated bills and expensive on-site meter readings are replaced with an accurate, low cost reading every time. This is also done at a frequency that best suits the commercial relationship with the business or domestic consumer. At the same time, it enables the utility company to make more effective use of its resources to more accurately meet the needs of its customers, saving energy.
Customer service is also improved significantly, as over-estimated readings and revised bills are removed at a stroke. Utility firms are also able to offer customers more suitable tariffs based on their individual usage patterns.
Though much of the detailed timing has yet to be determined at a local level, it is clear that implementation of smart electricity meters is likely to be completed EU-wide within the next 12 years. Each national government must put in place its own enabling legislation for deployment and will progress at its own pace in meeting this deadline.
At one end of the spectrum, Sweden already has its own regulation in place. As a result, since 2009 all utility companies must read their electricity meters at least once a month: this is being undertaken using cellular connectivity as part of the Advanced Metering Infrastructure (smart metering) solution.
In the UK, plans are also in place to meet this EU requirement by equipping every home with a smart meter by 2020. And British Gas in particular has already confirmed its intention to step up the pace, by installing more than a million smart electricity meters over the next years.
The task, and the opportunity, is immense. In the UK alone, some 26 million electricity and 22 million gas meters will need to be fitted, at a total cost of an estimated £7 billion.
Environmental concerns are once again climbing back up the agenda, at a personal, corporate and a national level. As part of this, the drive to introduce smart meters is already evident: nationally and internationally, governments are looking to significantly reduce their carbon footprint by making users more aware of energy consumption at a domestic level.
Once again, the UK government has calculated that, with greater cost transparency the average household’s annual bill would be reduced by 2% or £20. This in turn could cut the country’s national CO2 emissions by 2.6 million tonnes per year.
A smart meter offers two important advantages over conventional metering. First, it identifies consumption far more accurately than a traditional meter. It then communicates that information back to the relevant utility for monitoring and billing purposes. As a consequence, M2M technology forms a key part of the development of smart meters, in providing essential connectivity between the individual meter and the energy supplier.
Although it is still early days for smart metering technology, network providers have started to form strategic international partnerships with meter manufacturers and meter systems providers/systems integrators. The goal here is to integrate the M2M connectivity platform seamlessly with the metering software, in order to provide robust real-time data and analysis regarding electricity usage.
In addition, M2M solutions can also be used to improve efficiencies, by replacing periodic servicing with on-demand servicing. Rather than taking equipment off-line for scheduled maintenance, built-in diagnostics can schedule minor servicing to be done on an ad hoc basis. Major servicing will then only be undertaken when it is necessary. This will also be backed up by a full audit trail of defects, usage, maintenance activities and any external inputs.
Solutions are being designed, built and project-tested in order to be ready for rollout within each European jurisdiction. With the need to deliver universal coverage in different environments throughout Europe, there are several key elements that a best-practice M2M connectivity solution should include if it is to meet the requirements of the meter manufacturer, systems integrator partner and the utility customer: The availability of a truly global footprint is key to delivering the coverage required for consistent and comprehensive performance monitoring and diagnostics across the complete network; a global SIM, which enables national roaming in order to ensure seamless, cost-effective coverage across all networks; the integration of the SIM as an industrial component – soldered into the meter or tracking box – rather than inserting a separate SIM card.
By embedding the SIM within the meter itself, this provides two essential benefits. First, this ensures that the life of a typical SIM is extended to cover the complete 15-20 year life of the meter. Second, it enables the SIM to withstand the extreme temperature ranges to which the meter may be subjected in different geographies. As a result, the meter can be installed anywhere and registered automatically in the local network.
From the standpoint of the meter supplier or system integrator, the value of a truly global, proven network partner lies in the ability to develop a common solution which can be offered across multiple geographies. This avoids the need to undertake the costly and error-prone iterative process of developing a new solution each time the provider wants to expand into a new geography.
Similarly, for the utility customer, the ideal network provider must offer stability - both in terms of robust connectivity at a domestic level and financial solidity - to support a long-term relationship in what is a mission-critical business application.
From an environmental perspective, smart metering is also expected to deliver lower carbon emissions as users get a more accurate picture of their energy consumption. Users will be incentivised to cut consumption by the prospect of significantly cutting their energy bills. And utility companies will also benefit from greater transparency of usage and customer behaviour, allowing them to more accurately forecast energy consumption and operate more efficiently and cost-effectively. In short, everybody wins.
Led by such applications as smart metering, it is no surprise therefore that the M2M sector is on the verge of impressive growth. Independent analyst, Berg Insight, for example has forecast that global operator revenues for wireless M2M will increase from 3 billion euros in 2008 to 8.9 billion euros by 2012.
To deliver effective differentiation, providers of M2M solutions should combine a technically advanced yet robust technology offering first class service support within a strongly price-competitive overall offering. This places tough demands on any supplier partnership, but the potential rewards in the future are highly attractive – for the provider, the utility and the end user alike.
Erik Brenneis is head of M2M Smart Services at Vodafone Global Enterprise