Smart meters need smart policy
The European Parliament's recent vote on amendments to the 3rd energy legislative package may make mandatory introduction of smart energy metering in private premises more likely. At the same time, the governments of some EU Member States - including Germany - have considered, or are considering, liberalising the market for metering services. The relationship between the roll-out of smart metering and the liberalisation of metering services must be taken into account by policy makers.
In a contribution to the German edition of Dow Jones Energy Weekly, Christoph Riechmann and Dan Roberts of Frontier's European Energy Practice discuss the challenges facing policy makers. They find that an uncoordinated introduction of metering competition and smart metering could lead to substantial disadvantages for consumers, particularly if different metering services companies chose to use different technology standards and communication protocols. Therefore, if a political choice has been made to roll out smart meters, policy makers should ensure common technology standards are applied. In addition, the desire to liberalise metering services must be balanced by the aim to roll-out smart meters in a cost effective way that captures the potential for scale efficiencies provided by this large infrastructure project.
Frontier (Europe) and its staff have been involved in the economic analysis of smart metering roll-outs in, for example, the Netherlands, the UK and Italy.
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