Undertaking a smart metering project or investing in infrastructure to upgrade an energy grid is a huge undertaking. Usually a utility must produce a positive business case with a clear return on investment before a project is given the green light.

Incentives can play a significant role in helping projects get off the ground, and a number of the smart grid projects in North America were kick-started with Department of Energy stimulus funding under the American Recovery and Reinvestment Act of 2009. Positive results in terms of economic output and employment, and more robust and smarter grids are also signalling a successful investment for the DOE.

Incentives are not always in a cash form; new climate change legislation has had impacts across Europe and North America in terms of attitudes and willingness to upgrade existing energy grids to achieve societal outcomes. The Energy Independence and Security Act of 2007 supports the modernisation of America’s grid, specifically smart grid infrastructure upgrades and the integration of renewable energy sources. Canada also has similar targets: for example the province of British Columbia has the Clean Energy Act 2010 (CEA) which is the product of the provincial government’s long standing commitment to clean energy and the reduction of greenhouse gas emissions.

In Europe, the EU Energy efficiency directive aims to improve energy efficiency by 20%. But under the terms of the Third Energy Package, there is no obligation to roll out smart meters, rather a requirement that member states undertake a cost-benefit analysis and submit the results to the Commission. In most circumstances a positive business case is returned, however some countries, including Germany, have opted out of the European commission’s programme for 80% smart meter deployment by 2020 and are going for a phased deployment instead.

Data explosion

"With the growth of the smart grid and the proliferation of smart meters comes an increase in the challenges presented by networks"

With the growth of the smart grid and the proliferation of smart meters comes an increase in the challenges presented by networks, especially in the rise of large amounts of new data streams to distribution network operators.

Ensuring these data management and communication challenges are overcome will require innovation and a new brand of resourcefulness throughout North America, and across the globe, that spans technology, people, resources, business models and organisational culture. But from there, the commonalities among regions and utilities begin to dissipate, and strategies for deploying smart metering and smart grid technologies to address a broad array of strategic and operational objectives vary significantly from region to region, even within North America. Utilities and DNOs in various regions face their own mix of broader, common challenges, such as the need to increase energy efficiency and manage peak load through demand response and other customer engagement programs. But they also face specific business problems, such as reducing losses due to theft and ensuring reliability with aging infrastructure.

Smart metering technology and service providers, such as Itron, provide more than just the metering assets to measure energy consumption. Their role has evolved into that of a solution provider, and consultant for communications, data collection and management, and service provision, among others. Generating copious amounts of data on energy consumption and network performance is of no use unless this data can be transmitted securely to those who can make sense of it and generate new business value. Integrated and interoperable systems are key in making sure this happens and smart technology providers play a leading role in the design and execution of data transmission.

Communications choices

There are many different ways of communicating with a meter: wired and wireless, public and private networks etc.

Several key considerations go into selecting a communications solution: cost, bandwidth, latency, reliability and future technical risk.

Due to the densities and the characteristics of their distribution systems (eg number of customers per transformer) powerline carrier technology (PLC), which transmits data over the utility’s power lines, will certainly play a central role in smart meter strategy for many utilities in Europe.

Next-generation PLC technology for the European market features significantly enhanced performance and throughput for today’s lower-latency use case requirements.Yet in today’s rapidly changing technology environment, utilities have choices in communications technology under a single unified network solution. In addition to PLC communication, RF Mesh and cellular communications provide attractive options depending on performance and cost requirements.

RF Mesh is proving itself in North America and other markets to be a cost-effective and highly reliable option for not only smart metering, but also today’s grid applications such as demand response, distribution automation and grid sensing applications. These applications include Volt/VAR optimisation, Conservation Voltage Regulation (CVR), Transformer Load Balancing, Fault Detection Isolation and Restoration (FDIR), Power Restoration and Remote Switching.

In addition to PLC and RF Mesh technologies, cellular communications has emerged as an increasingly attractive solution not only for commercial and industrial metering applications, but mass market residential networks as well. Chip set technology has advanced, while hardware and monthly carrier costs have decreased dramatically. These macro trends have enabled an increasing number of utilities in North America to embrace cellular as their preferred communications transport choice for large-scale smart metering and smart grid projects. Or they have chosen a mix of communication technologies to optimise cost and performance for specific applications or territories.

But technology advances, open standards, distributed intelligence, and network convergence are rapidly putting to rest the idea that utilities must choose a single, ‘one-size-fits-all’ communications technology for their smart metering and smart grid initiatives.

The use of open standards and multiple communications technologies allows utilities to create a flexible architecture that meets their business needs. The use of Internet and other standard Protocols ensures that integration with back-office systems and existing IT infrastructure is cost-effective and efficient.

Open standards

However, in order to address growing data management problems cost-effectively, and mitigate technical risk, it’s important for utilities in the market to coalesce around some common standards to simplify and streamline deployments, ensure robust security and create a platform for future innovation.

"For utilities and DNOs in diverse markets around the world, the IP standard… has proven itself to be a highly suitable umbrella standard for smart metering"

For utilities and DNOs in diverse markets around the world, the IP standard – which underpinned the explosion of growth, utilisation and innovation with the Internet – has proven itself to be a highly suitable umbrella standard for smart metering and smart grid network architecture. IP, which is already relatively well utilised by utilities in North America, provides a well-established protocol that offers a robust, common security model and the most efficient path to multi-application capability and device interoperability. Essentially, IP means that the network behaves like an enterprise-class IT network, with robust network management tools to prioritise traffic and Quality of Service (QoS). Devices can ‘plug and play’ on the network, much like a new PC or printer or ‘phone on a corporate enterprise network.

To achieve this vision of flexibility and expandability in smart grid networks, Itron has partnered with Cisco, the global leader in networking technology, to bring to market an IPv6 architecture for Itron’s OpenWay network.

Key case: BC Hydro

This unique partnership has helped many utilities across North America and the globe to modernise through deploying a smart grid programme. One such utility is BC Hydro, a Crown corporation owned by the Province of British Columbia, one of North America’s leading providers of clean, renewable energy. As the primary electric utility in British Columbia, it serves approximately 95% of the province – roughly 1.9 million customers.

In 2011, BC Hydro undertook a project to modernise its energy system infrastructure through a smart grid programme. The Smart Metering Programme, as the project is known, is more than replacing old analogue and digital meters with new smart meters. It also includes additional systems used in conjunction with smart meters to create efficiencies and improve the company’s ability to deliver electricity safely and reliably.

The increased amount of data generated by customers and system meters is managed by a sophisticated and scalable meter data management (MDM) system. BC Hydro’s advanced architecture system incorporates use of the company’s existing SAP system to integrate the MDM system with business functions such as customer care and billing.


BC Hydro began exploring smart metering and smart grid technology more than a decade ago to solve issues related to meter accuracy, and electricity theft, and to explore customer-focused conservation tools.

At the same time, utilities around the world were rapidly adopting new metering technology that evolved from drive-by wireless technology to wireless smart metering systems that could accurately and reliably measure the electricity consumed, provide more accurate information about overall electricity use on the grid – allowing utilities to more efficiently dispatch crews during outages, reduce line losses on the grid, provide better customer service, and provide timely feedback to customers about their consumption, leading to cost savings. These benefits led BC Hydro to produce a business case in early 2011 that showed that the smart metering programme had strong positive net returns over 20 years – helping to reduce costs and reduce upward rate pressure.


Foundational to the programme are Itron OpenWay® smart meters, communicating over a multi-application communication network powered by Cisco. BC Hydro is one of the first utilities in North America to deploy a full IP-based network. Based on IPv6, the network will standardise the way that grid devices connect and applications are added, accelerating the development of other smart grid technologies and creating additional avenues for utilities to support critical smart grid use cases. The associated system and meter data management software are included in the deployment.

Itron’s Meter Data Unification Synchronisation (MDUS) was a critical component of the operation of these business processes. The tool was used to support meter asset management, customer care, billing financial systems and human resources, as well as project and portfolio management.


"As of early 2014, 99% of BC Hydro customers were served by smart meters"

BC Hydro set the record for the fastest meter deployment in North America with over 1.8 million installed in just 18 months. As of early 2014, 99% of BC Hydro customers were served by smart meters; the vast majority of these customers have been converted to automated billing and had have access to an interval data web interface. The ability to download new firmware to the Cisco connected grid router (CGR) devices with minimal human intervention has afforded the utility an increase in network performance and system stability. This capability has realised key benefits in a number of areas.

  • Enhanced meter reading that provides up-to-date electricity-use and billing information;
  • Analysis and application of smart grid data for business intelligence;
  • Two-way communication, smart meters to BC Hydro, improves operational efficiencies;
  • Voltage and power quality data to optimise the operation of BC Hydro’s electricity grid.

Over the coming months as the advanced infrastructure becomes fully operational, BC Hydro will know when a customer’s power is out and when it is has been restored, and be able to accommodate new sources of small-scale, clean renewable energy; and roll out additional customer conservation tools through in-home feedback devices.

With smart meter deployment completed, BC Hydro is realising the benefits of smart grid technology, including streamlined operations, revenue protection through theft detection, and improved visibility into system assets.

Continuing with their plan, BC Hydro will be using the aggregate data to optimise the distribution system through voltage optimization, integrate outage detection with existing outage management system, and building theft detection analytics. Analytics software will pull data from transformer and feeder meter devices that utilise the IPv6 Itron-Cisco network. The interval data is also being used to build more and better load research/forecasting models. Such insights will facilitate the integration of distributed generation facilities, and management of peak-time loads.

The future landscape

Smart metering and the associated communication infrastructure is not an end in itself. These technology investments are made to solve specific problems. Smart meters, when combined with communications infrastructure, meter data management and analytics form end-to-end solutions that create business value in addressing a range of business challenges. When viewed from this solutions perspective, the value of the investment becomes much more clear and compelling.

The future of smart grids lies in the concept of ‘big data’ and the ability to process information from the digital economy we are shifting towards. Itron’s own research of consumers and utility executives shows that around 70% of them believe that unlocking insights from big data are central to infrastructure modernisation efforts. It is early days for analytic platforms across North America and Europe but it is easy to see that they will be an essential tool in helping to meet our commitments to climate goals and more intelligent management of the world’s energy resources.