Monday, September 17, 2018
SMART METERS. PRIVACY ISSUES OR A VITAL TOOL FOR OUR FUTURE?
The Guardian two weeks ago featured an anguished reader’s letter concerned about the invasion of privacy involved in the installation of smart meters in UK households. It’s worth reflecting briefly on what the privacy and security issues might be, what the real social value of smart meters might be, and how we should balance these with an effective policy.
Smart meters, and I have just acquired one for my electricity supply, will tell you a number of things that you might have found it difficult to work out previously. These may include for example what your power use (in watts or kilowatts) is at any instant in time, what it was in the last few hours, days or months. The privacy concern is that the utility, your supplier, can be assumed to have the capability to collect and keep this data, and, for example, could build up a picture of the minute by minute electricity consumption of every household with a smart meter.
There are many, not particularly sinister, reasons why utilities might want to do this. At a minimum it can provide a better understanding of how consumers use electricity can help in planning future system needs, make sure that local networks have adequate capacity to cope with fluctuations in load, and so on.
On privacy and security issues we should perhaps be far more worried about the amount of sensitive information held on you by your bank and your credit or store card issuer, not to mention Facebook, Google and your telecoms supplier, or, and, currently in the news, the airlines you use. Between them these have tons of information about your shopping habits, lifestyle, opinions, financial affairs, favourite websites, and so on, all of which, if privacy and security are breached, potentially give rise to much more serious abuses than someone being able to work out what time a household has breakfast or runs the washing machine.
It’s also certainly true, as a number of readers are testifying, that the government has not fully thought through its policy objectives on smart meters, and that the programme is unlikely to deliver many of the promised benefits, at least in the short term. And of course there are as usual a lot of horror stories on installation failures. But none of this should blind us to the fact that there is a huge and essential future for devices which create a much closer connection between the way we use energy, and electricity in particular, and the factors that constrain when and how it is produced and delivered.
Let us take a simple future example. We expect a big future for electric vehicles. This has the potential to create big spikes in load, with everyone switching on together, in a period when we will depend increasingly on renewable energy sources which are much more variable than currently, and harder to match to varying consumer demand. One answer to this is for some EV owners to charge their vehicles overnight, but for the timing of that supply to be at the discretion of the supplier, who can match it to when production is available to meet it. In exchange for this surrender of direct control, consumers will get a much more favourable tariff for their EVs, and the practical issues of managing network overload, when all EV owners try to re-charge their vehicles immediately on return from work, can be avoided. This obviously implies an element of intrusion, in the sense that the utility “knows” the purpose of the load it is required to meet. It also assigns a choice (over timing) from the consumer to the utility. But this is a commercial transaction, willingly entered on both sides, providing benefits to both parties.
Smart meters are just a starting point for more sophisticated and user friendly tariff and conditions of use arrangements which can redefine the ways we use energy. No doubt there will be privacy issues to be managed, but essentially these will be no different in character from the privacy issues we encounter in relation to almost all our transactions with businesses large and small. They will be substantially less than most of those that we face in relation to financial transactions, social media and our day to day use of IT and the internet..
Some of the benefits that can flow from more sophisticated metering and tariffs are highlighted in a report published last week by Energy Systems Catapult, which starts to explore the numerous tariff issues highlighted by progress towards a low carbon economy.
Cost Reflective Pricing in Energy Networks. The nature of future tariffs, and implications for households and their technology choices.