Introduction:

A smart meter is a digital meter that replaces old analog meters, which are used in homes to record electrical usage Smart meters are the third pillar of the proposed technology-driven transition in electricity systems globally, in addition to renewable energy and energy storage technologies. In the Budget 2020-21, the Finance Minister urged states and union territories to replace all conventional electricity meters with prepaid smart meters.

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Significance of Smart meters:

• Consumers:
  • Smart meters help in monitoring and managing electricity consumption and save money. It can be like your mobile pre-paid connection. You can buy electricity for a fixed amount, and use it. After finishing, you can top-up, just like a mobile recharge.
  • It can reduce billing errors.
  • The pro-poor argument is that these meters allow payment in small, affordable fragments.
  • It may offer a sense of control over consumption and thus relieving the poor of the debt they accumulate with the discom.
• Discoms:
  • Smart meters help power distribution companies (discom) to conduct power-quality analysis in near-real time, taking into consideration factors such as maximum demand, voltage fluctuation, outage detection etc.
  • It helps discoms reduce peak power purchase cost, thereby improve business efficiency. This in turn reduces their debt, thereby helping the economy.
  • Smart meters also aids in the recovery of receivables, which has caused a huge stress on the system. Estimates say that Rs 1 lakh crore worth power was unbilled last year. So, it can help discoms plug leakages in the whole chain.

Overall benefits of the Advance Metering Infrastructure (AMI) are multifold and can be generally categorized as:

• Operational Benefits: AMI benefits the entire grid by improving the accuracy of meter reads, energy theft detection and response to power outages, while eliminating the need for on-site meter reading.
• Financial Benefits: AMI brings financial gains to utility, water and gas companies by reducing equipment and maintenance costs, enabling faster restoration of electric service during outages and streamlining the billing process.
• Customer Benefits: AMI benefits electric customers by detecting meter failures early, accommodating faster service restoration, and improving the accuracy and flexibility of billing. Further, AMI allows for time-based rate options that can help customers save money and manage their energy consumption.
• Security Benefits: AMI technology enables enhanced monitoring of system resources, which mitigates potential threats on the grid by cyber-terrorist networks.

Challenges posed by Smart meters:

• Smart meters certainly are not tamper proof. The meters can be rigged.
• Also, smart meters come with their own set of challenges, most notable being it prone to cyber attacks, which can cause power shutdown or steal customer information.
• In the last few years, there have been instances of cyber attacks on the power grid, which caused power blackouts in California (US), Ukraine etc., though the utilities have to yet confirm whether the power grid was brought down due to a cyber attack.
• Also, poor agriculture-dependent households currently treat electricity dues as a credit option.
• These dues are accumulated during the lean period and are paid in the harvesting season.
• Smart meters will require access to network and support architecture to transmit and store data.
• There is no clarity on the network costs, who will bear it, and the impact on the electricity bills of the poor.
• Prepayment will imply elimination of security deposits, which offer cheap working capital. Both factors impose costs on discoms.

Conclusion:

Modernizing India’s grid system by investing in AMI promises to mitigate a number of strains placed on the grid due to growing demand for electric, gas and water resources. Energy Efficiency Services Limited (EESL) has installed over 5 lakh smart meters in Uttar Pradesh, Delhi, Haryana, Bihar and Andhra Pradesh which have been distributed under the Smart Meter National Programme (SMNP).