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Smart Metering in Western Europe is the sixth consecutive report from Berg Insight analysing the latest developments for smart metering in Europe.
This strategic research report from Berg Insight provides you with over 160 pages of unique business intelligence, including 5-year industry forecasts, expert commentary and real-life case studies on which to base your business decisions.
Highlights from the sixth edition of the report:
> Case studies of smart metering projects by the leading energy groups in Europe.
> In-depth market profiles of fourteen countries in Western Europe.
> Status updates on the development of smart grid and communication technology.
> Updated profiles of the key players in the metering industry.
> Revised market forecasts lasting until 2014.
> Summary of the latest developments in the European energy industry.
Smart meters to transform the European energy market
Metering is a fundamental enabler for the utilities industry. At the beginning of 2009, there were approximately 253 million electricity meters; 109 million gas meters and 3 million district heating meters in EU23+2.
Electricity reaches virtually every household and business in the whole of Europe, while gas is most widely used in the Netherlands, the UK, Italy, Germany, France and Poland. District heating is a significant energy source in the Nordic countries and Central Eastern Europe. The residential sector is the second largest final user of energy, accounting for about 30 percent of consumption.
As part of the efforts to build a sustainable energy system, the traditional mechanical utility meter must be replaced by a smart device. These so called smart meters are a core element in the vision for smart grids – intelligent energy networks that contribute to improved efficiency and reliability in energy distribution and better optimisation in allocation of resources and utilisation of assets. Smart metering solutions may incorporate a wide range of applications in the fields of remote meter reading, customer relationship management, demand-side management and value added services.
Remote meter reading is the core application, providing the data recorded by the meter to the metering system operator, which could be the DSO or an independent party. Smart metering solutions can also be used to support customer relationship management and demand-side management (DSM), as well as enable various value added services in for instance home automation.
The adoption of smart metering in Europe is to a large extent driven by regulations. A majority of the countries in Western Europe have adopted a policy of regulation-driven introduction of smart meters.
Sweden was first, followed by the Netherlands, Ireland, Norway, France, Italy and Spain. The UK and Finland were the latest countries to announce regulated rollouts in October 2008 and February 2009 respectively and Denmark seems likely to move in the same direction. Furthermore nationwide projects led by publicly owned energy companies are underway in Portugal and Malta.
Except for Italy where the rollout is already almost complete, the larger countries have long timeframes. France and Spain have deadlines at the end of the 2010s, while the UK has set the target date to 2020. The common energy policies of the EU, based on the 20-20-20 targets, plays an important role in this development.
The 3rd Energy Package, approved by the European Parliament in April 2009, proposes that – subject to an economic assessment – 80 percent of all electricity customers should have smart meters by 2020. Furthermore it defines guidelines for supplier-changes, energy consumption information and service quality level monitoring which are very difficult to meet without smart meters.
Italy was the first European country where smart meters were deployed at a massive scale in the first half of the 2000s. By 2011 all Italian electricity customers will be covered by the technology. Sweden however became the first country to achieve 100 percent penetration in July 2009 following a regulation driven rollout. The other Nordic countries are following with Finland and Norway looking to introduce smart metering legislation by 2013, while Denmark has seen strong uptake of the technology without any regulatory requirements.
Spain and Ireland are expected to display high volumes from 2011, with France and most likely Portugal following in 2012. By 2013 these countries alone will account for more than 70 percent of total shipments. Elsewhere in Europe the market prospects are more uncertain. The UK is likely to see the start of large-scale deployments of smart meters within the next five years given that no unexpected events cause delays. The Netherlands appeared to be on track for a nationwide rollout starting already in 2010 but with the recent political setbacks the implementation of smart meters is now delayed until 2013 by the earliest.
Germany is not likely to see any major market developments in the short term but it appears likely that some of the large DSOs will go ahead with large-scale installations by the mid-2010s, regardless of the regulatory situation. The market prospects in Central Europe are uncertain but there are good reasons to believe that the pilots and early deployments seen today will evolve into major projects by the mid-2010s.
This report answers the following questions:
> How are EU energy policies driving the adoption of smart metering?
> Which are the latest countries to announce mandatory requirements for smart meters?
> What is the UK government’s plan for a nationwide rollout?
> What are the true implications of Germany’s new metering regulation?
> What are the latest market developments in the Nordic countries?
> Who are the leading suppliers of smart metering solutions for the European market?
> Which are the main providers of PLC and wireles
Tobias Ryberg is founding partner of Berg Insight and principal analyst. He is an experienced analyst and author of numerous articles and reports about telecom and IT for leading Swedish and international publishers.
The European Smart Metering market has been his major research area for the past 6 years.
Berg Insight offers premier business intelligence to the telecom industry. We produce concise reports providing key facts and strategic insights about pivotal developments in our focus areas. From time to time we also perform custom research assignments. Our vision is to be the most valuable source of intelligence for our customers.
Who should by this report?
Smart Metering in Western Europe in its sixth edition is the foremost source of information about the ongoing transformation of the metering sector. Whether you are a vendor, utility, telecom operator, investor, consultant, or government agency, you will gain valuable insights from our in-depth research.
Executive summary
Metering is a fundamental enabler for the utilities industry. At the beginning of 2009, there were approximately 253 million electricity meters; 109 million gas meters and 3 million district heating meters in EU23+2. Electricity reaches virtually every household and business in the whole of Europe, while gas is most widely used in the Netherlands, the UK, Italy, Germany, France and Poland. District heating is a significant energy source in the Nordic countries and Central Eastern Europe. The residential sector is the second largest final user of energy, accounting for about 30 percent of consumption.
As part of the efforts to build a sustainable energy system, the traditional mechanical utility meter must be replaced by a smart device. These so called smart meters are a core element in the vision for smart grids – intelligent energy networks that contribute to improved efficiency and reliability in energy distribution and better optimisation in allocation of resources and utilisation of assets. Smart metering solutions may incorporate a wide range of applications in the fields of remote meter reading, customer relationship management, demand-side management and value added services. Remote meter reading is the core application, providing the data recorded by the meter to the metering system operator, which could be the DSO or an independent party. Smart metering solutions can also be used to support customer relationship management and demand-side management (DSM), as well as enable various value added services in for instance home automation.
The adoption of smart metering in Europe is to a large extent driven by regulations. A majority of the countries in Western Europe have adopted a policy of regulation-driven introduction of smart meters. Sweden was first, followed by the Netherlands, Ireland, Norway, France, Italy and Spain. The UK and Finland were the latest countries to announce regulated rollouts in October 2008 and February 2009 respectively and Denmark seems likely to move in the same direction. Furthermore nationwide projects led by publicly owned energy companies are underway in Portugal and Malta. Except for Italy where the rollout is already almost complete, the larger countries have long timeframes. France and Spain have deadlines at the end of the 2010s, while the UK has set the target date to 2020. The common energy policies of the EU, based on the 20/20/20 targets, play an important role in this development.
The 3rd Energy Package, approved by the European Parliament in April 2009, proposes that – subject to an economic assessment – 80 percent of all electricity customers should have smart meters by 2020. Furthermore it defines guidelines for supplier-changes, energy consumption information and service quality level monitoring which are very difficult to meet without smart meters.
Italy was the first European country where smart meters were deployed at a massive scale in the first half of the 2000s. By 2011 all Italian electricity customers will be covered by the technology. Sweden however became the first country to achieve 100 percent penetration in July 2009 following a regulation driven rollout. The other Nordic countries are following with Finland and Norway looking to introduce smart metering legislation by 2013, while Denmark has seen strong uptake of the technology without any regulatory requirements. Spain and Ireland are expected to display high volumes from 2011, with France and most likely Portugal following in 2012. By 2013 these countries alone will account for more than 70 percent of total shipments. Elsewhere in Europe the market prospects are more uncertain. The UK is likely to see the start of large-scale deployments of smart meters within the next five years given that no unexpected events cause delays. The Netherlands appeared to be on track for a nationwide rollout starting already in 2010 but with the recent political setbacks the implementation of smart meters is now delayed until 2013 by the earliest.
Germany is not likely to see any major market developments in the short term but it appears likely that some of the large DSOs will go ahead with large-scale installations by the mid-2010s, regardless of the regulatory situation. The market prospects in Central Europe are uncertain, but there are good reasons to believe that the pilots and early deployments seen today will evolve into major projects by the mid-2010s.
Berg Insight says 96.3 million European households will have smart meters by 2014
According to a new research report from the analyst firm Berg Insight, the installed base of smart electricity meters in Europe will grow at a compound annual growth rate of 16.2 percent between 2008 and 2014 to reach 96.3 million at the end of the period. The strong uptake of intelligent metering puts within reach the EU-wide target that 80 percent of the households should have smart meters by 2020. Providing consumers with detailed information about their electricity consumption, the new generation of meters give customers control over energy costs and create financial incentives for energy savings. The adoption of smart meters started in Italy and has continued in the Nordic countries where Sweden decided to make smart meters mandatory from July 2009, starting a trend for the rest of Europe.
"Today, Sweden has become the first country in the world to achieve 100 percent penetration for smart meters", said Tobias Ryberg, Senior Analyst, Berg Insight. "In the next years Italy, Ireland, Norway and Finland will follow and by the end of the next decade many more countries including France, Spain and the UK will also have smart meters." He adds that some countries are moving slower due to resistance from certain stakeholders. The Netherlands has postponed the rollout of smart meters following a heated debate over the potential risk that remote monitoring of energy consumption would lead to privacy violations and in Germany the government is reluctant to impose what could be perceived as a surveillance technology.
"The privacy threat from smart meters is grossly exaggerated", said Ryberg. "They are opposed because they represent a new technology for collecting information in a time when large groups of people are afraid of the consequences of living in an information based society. Indeed the energy industry has a major responsibility in protecting the privacy of its customers, but first and foremost it must work to create a sustainable energy system in which smart meters are an essential component."
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Table of Contents
Table of Contents i
List of Figures.vii
Executive summary1
1 Electricity, gas and district heating distribution in Europe ..3
1.1 Energy industry players..3
1.2 Electricity market 5
1.3 Gas market .10
1.4 District heating market..13
2 Smart metering 15
2.1 Smart grids and intelligent meters .15
2.1.1 Smart metering applications .16
2.1.2 Smart metering infrastructure19
2.1.3 Benefits of smart metering .22
2.2 Project strategies .23
2.2.1 System design and sourcing 23
2.2.2 Rollout and integration .24
2.2.3 Implementation and operation .25
2.3 Regulatory issues 25
2.3.1 Models for the introduction of smart meters .26
2.3.2 Standardisation 27
2.3.3 Individual rights issues.27
3 PLC and wireless communication technologies 29
3.1 PLC versus wireless communication.29
3.1.1 PLC point-to-multipoint 29
3.1.2 Wireless Mesh point-to-multipoint..30
3.1.3 Mobile networks point-to-point 32
3.2 PLC technology vendors .33
3.2.1 Advanced Digital Design.33
3.2.2 Analog Devices.34
3.2.3 CURRENT34
3.2.4 Maxim34
3.2.5 Power Plus Communications 35
3.2.6 STMicroelectronics.35
3.2.7 Yitran Communications 36
3.3 Wireless technology vendors 36
3.3.1 Cinterion Wireless Modules ..37
3.3.2 Coronis .37
3.3.3 Ember38
3.3.4 Radiocrafts .38
3.3.5 Sierra Wireless..39
3.3.6 Sigma Designs .39
3.3.7 Telit .40
3.3.8 Trilliant ..40
3.3.9 Tritech Technology.40
4 Smart metering industry players.43
4.1 Meter vendors43
4.1.1 Landis+Gyr 44
4.1.2 Itron 47
4.1.3 Elster..50
4.1.4 Aidon .51
4.1.5 Circutor.52
4.1.6 Diehl Metering ..52
4.1.7 Entity Group ..53
4.1.8 Iskraemeco.53
4.1.9 Janz 54
4.1.10 Kamstrup .54
4.1.11 Sagem Communications.55
4.1.12 ZIV ..55
4.1.13 Asian vendors55
4.2 Smart metering solution providers .56
4.2.1 ADD Grup56
4.2.2 Echelon 57
4.2.3 Enel 58
4.2.4 ESCO Technologies..59
4.2.5 Founter .59
4.2.6 ISA ..60
4.2.7 Metrima.60
4.2.8 NURI Telecom..61
4.2.9 Policom.62
4.2.10 Siemens Power Distribution..62
4.2.11 Telenor Cinclus 62
4.2.12 Xemex63
4.3 MDMS and middleware vendors .63
4.3.1 EnergyICT64
4.3.2 eMeter ..64
4.3.3 Ericsson65
4.3.4 Görlitz 65
4.3.5 Netinium ..65
4.3.6 Oracle 66
4.3.7 Powel.66
4.3.8 SAP.67
4.4 System integrators..68
5 Market forecasts and trends .69
5.1 Market drivers and barriers.70
5.1.1 Macroeconomic factors70
5.1.2 Regulatory environment ..71
5.1.3 Competitive environment 74
5.1.4 Technology development ..75
5.2 Smart metering market forecast ..76
5.2.1 Capital expenditure forecast .77
5.2.2 Geographical markets..77
5.3 Impacts of smart metering on the European wireless M2M market .79
5.3.1 GPRS technology market79
5.3.2 Wireless Mesh technology market .81
5.3.3 The future role of wireless communication providers in metering.82
6 Market profiles: Northern Europe ..83
6.1 Sweden.85
6.1.1 Electricity distribution industry structure.85
6.1.2 Metering regulatory environment 86
6.1.3 Smart metering market developments.87
6.1.4 The outcome of a regulation driven rollout 90
6.2 Denmark ..92
6.2.1 Electricity distribution industry structure.92
6.2.2 Metering regulatory environment and smart metering market developments 94
6.3 Finland ..96
6.3.1 Electricity distribution industry structure.96
6.3.2 Metering regulatory environment 99
6.3.3 Smart metering market developments.99
6.4 Norway100
6.4.1 Electricity distribution industry structure..101
6.4.2 Metering regulatory environment .102
6.4.3 Smart metering market developments..104
7 Market profiles: Western Europe .107
7.1 Austria.108
7.1.1 Electricity and gas distribution industry structure108
7.1.2 Metering regulatory environment and smart metering market developments .109
7.2 France.110
7.2.1 Electricity and gas distribution industry structure110
7.2.2 Metering regulatory environment and smart metering market developments .111
7.3 Germany 112
7.3.1 Electricity and gas distribution industry structure113
7.3.2 Metering regulatory environment .115
7.3.3 Early pilot activities..116
7.4 Ireland.117
7.4.1 Electricity and gas distribution industry structure117
7.4.2 Nationwide program for deployment of smart meters by 2013118
7.5 The Netherlands 119
7.5.1 Electricity and gas distribution industry structure119
7.5.2 Metering regulatory environment .121
7.5.3 Smart metering market developments..122
7.6 United Kingdom.123
7.6.1 Electricity and gas distribution industry structure123
7.6.2 Metering regulatory environment .125
7.6.3 The UK government's proposed rollout model.126
8 Market profiles: Southern Europe129
8.1 Italy ..130
8.1.1 Electricity and gas distribution industry structure130
8.1.2 Metering regulatory environment .132
8.1.3 Smart metering market developments..132
8.2 Spain133
8.2.1 Electricity and gas distribution industry structure133
8.2.2 Metering regulatory environment .134
8.2.3 Smart metering market developments..135
8.3 Portugal .136
8.3.1 Electricity and gas distribution industry structure136
8.3.2 Metering regulatory environment and smart metering market developments .137
8.4 Malta 138
8.4.1 Utility industry structure.138
8.4.2 National smart grid project..139
9 Case studies: Energy group strategies for smart metering141
9.1 Enel..141
9.1.1 The Telegestore Project 141
9.1.2 Marketing to external customers..142
9.2 ERDF143
9.2.1 The ERDF smart metering project143
9.2.2 Atos Origin selected as information architect and lead manager for pilot..145
9.3 E.ON 146
9.3.1 Experiences from the Nordic market .147
9.3.2 Projects in Western and Central Europe..149
9.4 RWE.151
9.4.1 Regional DSO operations in Germany..151
9.4.2 The Müllheim Zählt project..152
9.5 Iberdrola 152
9.5.1 The PRIME project ..153
9.5.2 Smart metering rollout plans for Spain and other markets.154
9.6 Vattenfall 154
9.6.1 Group smart metering initiatives ..155
9.6.2 Smart metering projects in Sweden and Finland.155
9.7 Three regional Nordic DSOs ..157
9.7.1 Göteborg Energi – Sweden.158
9.7.2 Helsingin Energia – Finland 159
9.7.3 SEAS-NVE – Denmark160
Glossary 163
Index
List of Figures
Figure 1.1: Top 25 energy companies, by proforma turnover (EU23+2 2008) .4
Figure 1.2: Electricity generation and consumption data (EU27 2007) .5
Figure 1.3: Electricity market statistics (EU23+2 2008) .7
Figure 1.4: Top 25 electricity DSOs (EU23+2 2009)9
Figure 1.5: Gas market statistics (EU23+2 2008) ..11
Figure 1.6: Top 25 gas DSOs (EU23+2 2009) .12
Figure 1.7: District heating market statistics (EU23+2 2007)14
Figure 2.1: Smart metering infrastructure19
Figure 2.2: Examples of smart electricity meters.20
Figure 3.1: PLC point-to-multipoint communication infrastructure.30
Figure 3.2: Wireless Mesh point-to-multipoint communication infrastructure..31
Figure 3.3: GPRS/HSPA point-to-point communication infrastructure.32
Figure 4.1: Meter vendor company data (2007/2008) ..44
Figure 4.2: Landis+Gyr smart metering product portfolio (Europe 2009) .45
Figure 4.3: Itron smart metering product portfolio (Europe 2009) .49
Figure 4.4: Echelon NES VAR partners 58
Figure 4.5: Examples of system integrators active in smart metering..68
Figure 5.1: Household power consumption and retail prices (EU23+2 2008) 70
Figure 5.2: Final year for deployment of smart electricity meters by country ..72
Figure 5.3: Smart meter shipments and penetration rate (EU23+2 2008–2014)76
Figure 5.4: Smart metering expenditure by activity (EU23+2 2008–2014)77
Figure 5.5: Smart meter shipments by region (EU23+2 2008–2014) ..78
Figure 5.6: Mobile connections used for smart metering by operator (2009)..79
Figure 5.7: GPRS device shipments and installed base, smart metering (2008–2014)..80
Figure 6.1: Smart meter contracts by country (Northern Europe 2009)..83
Figure 6.2: SM-contracts in the Nordic region by meter supplier and contractor (2009) ..84
Figure 6.3: Top 10 electricity DSOs (Sweden, 2009) 86
Figure 6.4: SM contracts awarded by top 10 DSOs in Sweden..88
Figure 6.5: SM vendor selection of medium sized DSOs in Sweden (2009) 89
Figure 6.6: Installed base of smart electricity meters (Sweden 2005–2009).90
Figure 6.7: Features of smart meters in Sweden.91
Figure 6.8: Top 10 electricity DSOs (Denmark, 2009)..93
Figure 6.9: Major SM projects in Denmark (June 2009)..95
Figure 6.10: Top 10 electricity DSOs (Finland, 2009)97
Figure 6.11: Major smart metering projects in Finland (June 2009) .98
Figure 6.12: Top 10 electricity DSOs (Norway, 2009) 101
Figure 6.13: Major SM projects in Norway (June 2009) 104
Figure 7.1: Major smart metering projects in Western Europe (June 2009) ..107
Figure 7.2: Top 10 electricity and gas DSOs (Austria, 2009) .109
Figure 7.3: Top 50 electricity DSOs (Germany, 2009)114
Figure 7.4: Electricity and gas DSOs (Netherlands, 2009)..120
Figure 7.5: Electricity DSOs (UK, 2008).124
Figure 7.6: Gas DSOs (UK, 2008).125
Figure 8.1: Major smart metering projects in Southern Europe (June 2009).129
Figure 8.2: Top 20 electricity and gas DSOs (Italy, 2009) 131
Figure 8.3: Top 5 DSOs (Spain, 2009)134
Figure 8.4: Top 5 DSOs (Portugal, 2009) .137
Figure 9.1: Telegestore annual operational data (2007) ..142
Figure 9.2: Overview of ERDF’s planned smart metering system144
Figure 9.3: E.ON electricity and gas distribution markets overview (2009).147
Figure 9.4: SM contracts awarded by E.ON Nordic (2005–2007) 148
Figure 9.5: E.ON smart metering projects in Western and Central Europe (2009).149
Figure 9.6: SM systems in Vattenfall Nordic Distribution Business Unit (2009) 156
Figure 9.7: Smart metering contracts awarded by Vattenfall Nordic (2002–2007) .157
For full details, please email keithw@cmsinfo.com
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