I have long struggled with the idea of introducing competition as a way to rollout smart meters as is happening in Australia. I support the concept of open markets, but I wonder if the Australian Energy Regulator’s principle of ‘introducing competition wherever feasible’ has gone one step too far this time. As we have seen in other industry verticals, open markets with little regulatory oversight don’t always serve the consumer.
I am unconvinced the introduction of smart metering competition delivers value as it fragments a critical part of the value chain. The value of smart meters is rooted in data analysis, where over time, large datasets provide insights leading to improved products and services to the whole community.
Having access to these datasets that represent a large part of the target location is key to delivering value, for example:
- The UK is driving for anonymised data sets to be made available as part of its open data access policy. This can be used by the government, academia and private enterprise to get a macro view of energy usage.
- The Green Button initiative in the US is now at the stage where a person can approve daily access to their energy data so a third party can deliver products and services that perhaps their electricity utility doesn’t.
- Dozens of Utilities globally are using the data to justify improvements to safety, reliability and cost of delivering power. This value is at the heart of their smart metering business case.
- Regulators can use the data generated by smart meters to keep the network operators honest, and to further encourage investments in behind the meter technologies.
The Australian model leaves the distribution of smart meters to retailers – I have written about some of the the issues I see with this previously here, and questions still remain. Given the above, do you believe the introduction of Smart Metering Competition is in the best interest of the consumer and the broader community?
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