Energy, Utilities and Chemicals

the way we see it

Smart Meter Deployment

in the UK
Meeting the challenges of mass rollout

The government is currently consulting on the

mandatory deployment of smart electricity and
gas meters to every home in the UK by 2020. This
represents one of the greatest challenges and
opportunities that the UK energy industry has ever
faced. The wide-ranging issues being addressed
during the consultations include technology, tariffs,
data management and finance.

Energy, Utilities and Chemicals

However, the issue that is arguably most critical to

the overall success of the programme is the physical
deployment of the meters themselves. Mandatory
deployment of gas and electricity meters will require
a visit by engineers to every home in the country
over an eight-year period, starting in 2013, to replace
25m electricity and 22m gas meters and (possibly)
install in-home displays for every household. This will
be a massive undertaking in terms of complexity as
well as size.
Our view is that a regionally
organised, franchise-type approach
to deploying the meters and
implementing the underlying network
is likely to emerge as the best option
to maximise time to value, minimise
costs and keep customers on-side.
Such a model is equally feasible
whether deployment is retailer
or DNO led. Other prerequisites
include rapid expansion and training
of the deployment workforce,
the development of alternative
customer service channels, and the
introduction of sophisticated field
force and work scheduling systems.

Analysing the challenges

Our experience of carrying out mass
smart meter deployments around
the world gives us insight into the
scale and nature of the challenges
involved in this programme. These
challenges include complexity and
cost, shortage of implementation skills,
the additional customer service burden
and the need to capture information to
support resource allocation.

Complexity and cost of

physical deployment
This is one of the most complex
logistical challenges attempted
in the UK. In addition to the
installation of the 47m meters and
the associated in-home displays,
a central communication network
may also be architected, designed,
built, commissioned and integrated
to manage the meter data and
disseminate it to retailers and other
industry bodies such as distribution
Smart Meter Deployment in the UK

the way we see it

network operators (DNOs). The

deployment of meters needs to be
properly integrated with the network
implementation (see panel overleaf).
The UK deployment challenge presents
some unique physical and engineering
challenges when compared with
programmes in the US and Canada.
For example, in contrast with North
American practice, electricity and gas
meters in the UK tend to be located
inside dwellings and commercial
premises, presenting access problems
for engineers and potential issues
with network connectivity. Also,
UK electricity meters are typically
mounted on to the back board and
hard-wired to the incoming line using
ties; they will therefore need replacing
by trained electricians, each of whom
will probably only be able to replace
a maximum four to five meters per
day based on the time required for
the tasks. In North America, meters
are generally socket-based, meaning
that non-qualified staff can be used,
replacing up to 40 a day.
Many antiquated electricity meters
are still in place here, connected to
even more aged infrastructure. Some
will require considerable additional
work to ensure safe and compliant
installation of a smart meter. Since
meter engineers will not usually know
which dwellings require this work
until they get on site, follow-up visits
will be necessary. Gas meters will have
similar issues: perhaps greater ones in
terms of safety checks. Relatively few
engineers today are qualified to deal
with both gas and electricity meters,
a fact that could cause additional
complexity and increase the frequency
with which multiple visits to the same
property are needed.
Cost is a critical issue for the
entire smart meters programme,
particularly as it will influence
customer perceptions, which are key
to the success of the programme.
Uncoordinated nationwide
deployment, is likely to be inefficient
(see panel). Such an approach would
increase costs, complexity and risk of
3

Our experience of mass

deployment in other
countries, together with
our knowledge of the
UK energy industry,
positions us to develop
potential approaches
and solutions to the
challenges raised.

poor service, and thereby alienate the

public, whose support is critical to the
programme.
A final source of complexity is the
fact that the deployment process is
also the energy companies primary
opportunity to educate customers
about smart meters and their effective
use. That means that each customer
will need to be present , not just to
let the engineers in but to receive
their introduction to the new smart
technology. This would apply to initial
visits and any necessary follow-up
visits, and would eliminate options
such as, for example, leaving the
key with a neighbour for access.
This need for customer interaction
means that visits to customers who

are out at work will often need to be

scheduled for evenings and weekends
(further limiting the numbers of
meters that can be deployed in a given
time by given resources). Engineers,
meanwhile, will need to be equipped
to deliver training, to answer customer
questions, and perhaps to promote
other energy conservation services.

Shortage of implementation
skills
The resources required to meet the
2020 deployment target will be
approximately three times the level
of the existing workforce. A massive
recruitment and training effort will be
required, but is unlikely to start until a
mandate is agreed a factor that could
jeopardise the 2020 completion target.

The case for a regional deployment model

The proposal that each retailer should deploy to their own customers would involve
multiple supply chains, workforce management and customer systems. Most retailers
have customers nationwide and so, given the number of non dual-fuel customers, it
could well be envisaged that multiple workforces could turn up several times to the same
houses in the same street. This pattern has already been seen in European deployments
and has a major impact on costs, as well as increasing the risk of customer perception
and bad service. Additionally, some retailers are reluctant to undertake replacement
of meters in areas where they do not currently have workforce coverage or third-party
arrangements in place. It is clear that a franchise model or a DNO led deployment would
simplify many of these challenges. However, there are other technical issues that also
compel examination of regional and more logically driven roll out such as the Network
requirements.
Depending on the type of communications technology selected, it is possible that
implementation of the network will need to be integrated with meter deployment in order
to avoid network reliability and redesign issues. Also, retailers may be reluctant to deploy
smart meters without a network connection present as this will mean they are effectively
putting in a dumb meter. In this situation the engineer would be unable to demonstrate
the meter fully to the customer, and there would probably have to be more customer calls
during switch-on, and possible revisits once connection is made to address customer
and performance issues.
Therefore, it is a fair assumption that the network needs to be available before meters
are deployed. However, if a network architecture like PLC or mesh is chosen, the
network could not realistically be deployed across the country in one step. It would
typically be deployed in logical areas, and by default meter deployment would follow its
availability. (Note that this problem would not arise if nationwide GPRS were used as the
sole infrastructure; however, GPRS has potential problems of its own, such as uneven
coverage, and reception difficulties underground or in dense urban structures, and so it
is likely to be used as part of a portfolio of different network architectures.)
We believe that these issues, combined with the very real constraints on cost, mean
that it is almost inevitable that some kind of regional deployment will emerge, and that
it is preferable to plan and optimise this deployment model up-front rather than letting it
evolve in an uncontrolled way.
4

Energy, Utilities and Chemicals

Training of engineers who can install

both electricity and gas meters is likely
to be a priority.

Additional customer
service burden
Positive customer perceptions are
vital to the success of the programme.
Customers will be aware of the
costs of installation, and realise that
those costs are likely to be added to
their bills. They will therefore want
to understand how they can get
something back from the devices:
how to use them, what tariffs are
available, the billing arrangements,
and so on. Customers will also
demand prompt service and well
managed appointments. Unless these
expectations are met, they are unlikely
to support the deployment.
Satisfying these requirements will
necessitate an enormous customer
services capability across the UK.
Customer interactions will begin predeployment, when utilities will need
to work with each customer to plan
appointments and answer questions.
Immediately post-deployment,
customers will probably have queries
about the operation of the devices,
even if they have seen a demonstration
by the installation engineer; these
queries might relate to faults or energy
conservation. On an ongoing basis, the
extra data provided by smart meters
will prompt customers to interact
more frequently with their utility.
The additional interactions could
potentially overwhelm utilities, leading
to considerable additional costs.

Capturing and organising

information to support
resource allocation
Another important task will be to
align the available resources accurately
with the work that needs to be done.
The frontline workforce engineers
and customer service staff will be
the first to uncover issues such as
missed appointments, installation
and engineering problems and billing
discrepancies. If these issues are not
effectively captured and managed there
Smart Meter Deployment in the UK

the way we see it

is a high risk of losing control of the

deployment, with substantial financial
and reputational costs for the utility
and for the deployment as a whole.
In addition intelligent use of existing
data about the housing stock will
make it possible to plan the roll-out in
a more effective manner. For example,
by pinpointing older properties that
are likely to have outdated gas and
electricity meters and connections,
companies can forecast which houses
are likely to need extra installation
and safety work. Longer visits can be
scheduled for these cases minimising
the need for return visits.

Our conclusions
Our experience of mass deployment
in other countries, together with our
knowledge of the UK energy industry,
positions us to develop potential
approaches and solutions to the
challenges raised. Below we discuss
the main requirements for a successful
deployment.

A regional, franchise-based
approach
Experience and insights from both the
UK industry and other deployments
abroad suggest that a regional
approach to both meter deployment
and network implementation will be
the most cost-effective and efficient
in terms of both resources and
customer management. It allows
a single capability to be used for
coordination, planning, supply chain,
workforce management and customer
management, rather than duplicated
capabilities which would necessitate a
further layer of complex coordination.
A logical approach for a regional
deployment could be to use the 14
distribution zones to demarcate
the rollout zones. As each zone is
complete, smart grid capabilities can
be tested and rolled out. This approach
also offers the option of splitting the
communications hub and meter data
management across smaller regional
subsets if this proves more cost
effective and/or reliable than having
one large UK-wide hub.
5

One way to tackle regional deployment

would be with a franchise model,
whereby a single deployment entity
approved by the retailers in scope
works on all the meters in a given
region. Such an entity could be the
dominant retailer in a specific region,
or one of the licensed meter operator
and services companies. Compared
with a situation where each retailer
would have its own deployment team
in each region, this would make for
a more efficient, cheaper and more
coordinated deployment, with a
clearer path of communications for
end customers. While this method
could appear at odds with the
competitive deployment ethos of
the consultation documents, it can
drastically reduce overall programme
costs, length of deployment and
time to benefits, as well as the risk of
customer disruption and alienation. It
has no impact on retail competition for
energy or energy services at all, and in
fact provides a better deal to customers
and retailers through lower cost.
Therefore, a regional approach is likely
to be an attractive option. We believe
deployment models must be agreed
as soon as possible to allow effective
deployment planning, process and
systems design and resourcing to start.

Rapid expansion and training

of the deployment workforce
Another argument for completing
consultations as soon as possible is the
need to plug the resource gap. Once a
deployment approach and governance
have been defined, funds should be
made available to start recruitment
and training to achieve the necessary
increase in the number of engineers
available. Retailers and government
must work together to launch the
recruitment campaigns and initiate the
training schemes required.

Enhancement of customer
service channels
To manage increased customer
contact, and to avoid customer service
centres and existing channels being
stretched and incurring additional
costs, retailers will need to ensure
they have the right channels and
capabilities in place. Many retailers
are already investing in these types
of capabilities, including web portals
and Interactive Voice Response (IVR)
systems, and this investment will
need to continue and in some cases
be increased as mass roll out begins.
While this is necessary to ensure
that customer interaction can be
managed efficiently, it also brings
the opportunity to take advantage
of the smart revolution to roll out
additional offers and capabilities to
customers via multiple channels.

Field force and work

scheduling systems
Our experience shows that an
integrated field force and work
scheduling system is the only way
to coordinate, schedule and track a
deployment of this scale. We have
designed and rolled out systems
that combine the work scheduling,
meter supply chain, meter location
and billing capabilities into a single
Control Centre for the utility to
manage their deployment. The field
force is managed and optimised using
bespoke handheld devices for the
engineers. This device is integrated
into the deployment management
systems, billing systems and
procurement and warehouse systems
to ensure that information from the
frontline is instantly available to the
relevant business units and vice versa.

Final comments
Based on our past and current involvement in the strategy, planning and execution
of the deployment of millions of smart meters globally, together with our deep
knowledge of the UK energy sector, we believe that only by building on the
principles above can a mass deployment across the UK be successful. Even then,
the scale of the undertaking must not be underestimated. Outstanding programme
management will be needed if crippling cost overruns are to be avoided.
The UK is contemplating one of the largest smart meter deployments in the world.
If we take this opportunity, let us make sure we put in place the capabilities and
governance to make it the most successful in the world.

Smart Meter Deployment in the UK

www.uk.capgemini.com

About Capgemini
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www.uk.capgemini.com

Gord Reynolds
Practice Leader
Smart Energy Services
gord.reynolds@capgemini.com
+1 416.732.2200
2009 Capgemini. No part of this document may be modified, deleted or expanded by any process or
means without prior written permission from Capgemini