Clean Tech

Can smart meters turn around discoms?

M Ramesh | Updated on June 28, 2021

In control: For consumers smart meters enable more control over consumption with their usage log   -  ISTOCK.COM

They can help electricity suppliers manage operations better, but the target of installing 250 million meters by 2022 may not be easy

Smart meters could just be the nutraceuticals India’s moribund electricity distribution companies (discoms) need. The good news is that the smart meter programme has got off to a good start. The note of caution expressed by experts is that the rollout needs to be carefully done, avoiding pitfalls.

The numbers are heartening. India plans to instal 250 million smart meters by 2022 at a cost of ₹3 lakh crore. About 2 million smart meters have been installed under different initiatives in Uttar Pradesh, Bihar, Rajasthan, Haryana, and Delhi, but mainly through the public sector company EESL, which pays for the meters initially and later recovers the cost from the discoms over a period of time. EESL has so far installed 1.58 million smart meters.

But first, what exactly are smart meters? Broadly speaking, smart meters can communicate data to the discom. However, a good smart meter does a lot more. The Central Electricity Authority’s (CEA) technical specifications say that smart meters should have features such as bidirectional communication, integrated load limiting switch, remote firmware upgrade, net metering, and prepaid, post-paid, and time-of-day tariff features, over and above the measurement of electrical energy parameters. As such, with smart meters a discom can manage its operations better.

Information on EESL’s ‘National Smart Meter Program Dashboard’ reveals tremendous benefits: 11-36 per cent reduction in AT&C [aggregate technical and commercial] losses and 21 per cent improvement in billing efficiency or ₹301 per month per meter (though experts of energy think-tank Prayas Energy have questioned this figure, wondering if arrears collected have been counted in). From 11 lakh smart meters, discoms have seen additional revenues of ₹264 crore, it says.

The great leap forward

The leap from 2 million to 250 million is not going to be easy. Up till now, EESL has driven the movement with its pay-as-you-use model. This model calls for huge upfront investment by what is known as an ‘Advanced Metering Infrastructure Service Provider’, and no company other than EESL has succeeded in India so far. For the movement to reach its goal, discoms will have to get into the act.

In a perspective paper on smart metering, experts at Prayas Energy — Manabika Mandal, Shweta Kulkarni, Aditya Chunekar and Narendra Pai — call attention to a number of pitfalls along the way.

First, who will bear the cost of smart meters — the consumers or the discoms? Since discoms stand to gain financially — consumers gain mainly through potentially better service — they should foot the bill. But their poor financial health stands in the way. Prayas experts point out that the UP discoms had, during the rollout in 2018, clearly mentioned that the costs would not be recovered from consumers. But they went back on their word, petitioning the State electricity regulator for defraying the costs through an annual increase in tariff. Rajasthan and Bihar also want consumers to pay, but there is bound to be resistance to this. As Prayas notes, “for consumers, installation of smart meters means more control over consumption through records of their consumption history”, but that is not the same as more money in the pocket.

Consumer-centricity

Second, experts also point out that unless the movement is made consumer-centric, rather than discom-centric, it will not go on well. There are a number of aspects to consumer-centricity. For example, they should be given sufficient notice before the meter disconnects the power supply, especially in the case of pre-paid meters (which the government is keen on). Also, there is the issue of data — access and privacy. Consumers should have access to their own data collected by smart meters. As regards privacy — it is an uncharted territory. “High-resolution smart meter data, through analysis and inference, has the potential to reveal personal information of consumers such as occupancy, appliance usage patterns and even sensitive information such as entertainment preference,” says Prayas. Consumers need to be reassured of data privacy.

Besides, the consumer should see some tangible benefits from smart meters. One possibility is the automatic compensation for power outages exceeding a certain period of time — something that is envisaged in the Ministry of Power’s Electricity (Rights of Consumers) Rules, 2020. It is, of course, up to the state governments to adopt the Rules. Some, like Maharashtra, have incorporated automatic compensation through ‘supply codes’. Assurance of steady supply and compensation for outages is one good way to get consumers’ buy-in for smart metering.

So, there is a long way to go. Getting it right is the way for getting it done.

Published on June 27, 2021

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