Metering Technology to Spark Major Change, Study Predicts

Information and communications technology may spark a major shift in the balance of power among energy producers, utilities, commercial and industrial customers, and consumers over the next decade, according to a study by Cambridge Energy Research Associates (CERA), “Capturing Value: The Future of Advanced Metering and Energy Information.”

According to the study, commercial and industrial customers will form the initial battleground between distribution utilities and retail energy merchants. But, according to Steve Taub, associate director of CERA’s North American Energy Group and the study’s director, distribution utilities are more likely to keep control over residential meters.

Early adopters of automated meter reading and computerized control systems will gain a significant advantage over their competitors, in part by leveraging the value of the data ahead of competitors and by influencing regulatory decisions and standards in the early stages, the study predicts.

Sophisticated metering and communications technology has been available for years, but its value to regulated utilities has been limited, the study states. Currently only 6 percent of electric meters and 2 percent of gas meters are remotely read, even though the technology has been on the market for about eight years. That will change soon, the study predicts. Changes in industry regulation and structure over the past five years have increased the value of information that can be gathered from meters. Two-way information is critical to making the new industry structure work, and a lot of that information will come from customer meters.

Depending on the rate at which metering communication system costs decline over the next 15 years, CERA predicts that electric meter installation will grow between 10 percent and 17 percent annually, while the total electric market expands at just 1 percent each year. As a result, CERA anticipates that by 2015, communications-equipped metering will be included in one-fourth to two-thirds of U.S. electric meters. More details about the CERA study are available online at www.cera.com.

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