CER National Smart Metering Programme Steady State Model BGN Response to CER/13/151 Consultation

Transcription

1 CER National Smart Metering Programme Steady State Model BGN Response to CER/13/151 Consultation

2 Table of Contents 1. Introduction BGN Responses to Consultation Questions:... 4 BGN Response to CER/13/151 Page 2 of 11

3 1. Introduction Bord Gáis Networks (BGN) welcomes the opportunity to respond to the consultation on the Steady State Model (SSM) for the National Smart Metering Programme (NSMP), published by the Commission for Energy Regulation (CER) on 19 th July BGN s responses to the questions asked throughout the Consultation Paper follow in section 2 of this document. BGN Response to CER/13/151 Page 3 of 11

4 2. BGN Responses to Consultation Questions: The following table contains BGN s responses to the questions asked throughout the consultation paper: 1 Do you believe the stakeholder roles outlined in Figure 1 are the appropriate roles to deliver the NSMP strategic objectives? If not, please outline alternative roles per stakeholder. BGN believes that the roles outlined are appropriate. The expectation that the customer is an engaged participant is key to the delivery of the programme benefits which underlines the importance of effective customer engagement throughout the programme. BGN is comfortable with its proposed role as a provider of Smart Meter Services to the Industry and looks forward to further definition of the parameters of these services as the Market Design progresses. Furthermore we are committed to playing our part in delivering and operating an AMI which is aligned with the design principles. We concur with the view that suppliers are best positioned to effect changes in customer behaviour and recognise that appropriate commercial incentives are required as enablers of such change. We agree with the proposed CER role involving the setting of and ensuring compliance with Industry policy for Smart Metering. 2 Have we clearly defined the stakeholder roles outlined in Figure 1? If not, what further explanation is required? In our view, the stakeholder roles are clearly defined. 3 Do you believe the design principles outlined in Section 4.0 are appropriate for the evaluation of the SSM? If not, please outline alternative design principles. BGN Response to CER/13/151 Page 4 of 11

5 BGN believes that the design principles outlined are appropriate for evaluation of the SSM. It is evident that no chosen steady state model could achieve perfect alignment with all of the outlined principles, so inevitably any evaluation will have to involve a trade-off between the principles outlined. We have the following specific comments regarding some of the principles outlined. Consumer Focussed: Given the importance of an engaged consumer to the delivery of the programme benefits, we support the view that the consumer experience should be front of mind and that each working assumption of the SSM should be evaluated in this light. The importance of designing in robust data protection principles to the SSM is also clear and BGN welcomes the proactive approach being adopted by CER in prioritising this area of work. Scalable & Future Proofed BGN agrees that the Smart Metering Architecture should be designed to allow changes in data volumes without compromising system performance. BGN supports the view that the SSM should be future proofed to accommodate technology developments. However it is nonetheless the case that the principal components of the AMI technology will be selected during the Procurement process in 2014 with the expectation that these components will have a lifetime of years once they are installed from 2016 onwards. Therefore, whereas the SSM can be future-proofed, the capacity to take advantage of future technology developments will be limited by the requirement that selected technology components fulfil their expected lifetimes. Cost Efficient: BGN supports this design principle and is committed to playing its part in delivering the most cost-effective solutions for those AMI components which it will be delivering. Irish Market Context: BGN believes that this is a particularly important design principle to incorporate. The particular makeup of the Irish Energy Market will always have to be considered in any analysis of international Smart Metering experience. The market models which apply in those jurisdictions which have completed or are in the process of completing Smart Metering deployments may not align directly with the Irish market model. The level of change to the gas market design should be at a level appropriate to the requirements of the new Smart Metering Services, and be cognisant of delivering a programme of work in an acceptable timeline and cost. BGN Response to CER/13/151 Page 5 of 11

6 BGN believes that a further point which should be noted relating to the Irish Market is the small size of the market in terms of the number of consumers. This is particularly relevant in the context of the specification of technology components such as meters and the Home Area Network (HAN). These specifications should align with open standards and allow the selection of technology components already deployed and tested in larger international markets. This is important to minimise the risk in deploying these components and to ensure the most cost-effective solution possible. The SSM should be evaluated in the light of any potential impact on the specification of technology components such as meters and HAN which could lead to proprietary requirements unique to the Irish market. 4 Have we clearly defined the design principles in Section 4.0? If not, what further explanation is required? In our view, the design principles are clearly defined whilst noting that the Irish Market Context principle should be developed to include the aspect referred to above regarding avoidance of proprietary requirements for technology components. 5 Do you believe the critical functions outlined in Figure 2 clearly articulate the key data flows, processes/messages within the SSM? Figure 2 is a high level illustration of the data flows and process/messages which would apply within the SSM. It conveys the types of messages which will flow between market participants and who (or what device) is responsible for originating these message types. It allows an understanding, for example, of the respective roles of Networks and Suppliers in terms of messaging. As such it serves as a useful guide for the development of more detailed data flow and process diagrams to fully describe all interactions in the model. 6 Do you believe Table 1 represents appropriate key working assumptions underpinning the SSM? BGN Response to CER/13/151 Page 6 of 11

7 BGN believes Table 1 represents for the most part appropriate working assumptions underpinning the SSM. Similar to the model itself, these assumptions will have to be progressed to a further level of detail to allow the business requirements of the solution to be developed. We have the following specific comments: Stakeholder Roles: BGN agrees with the assumption that Suppliers own the Customer relationship. However BGN will continue to have a requirement to retain some customer information to fulfil certain regulatory obligations (should these continue in a Smart Metering world). These include customer protection and reporting requirements on, for example, the prevalence of pre-payment metering. Regarding the statement that half hourly consumption interval data will be available to Networks enabling daily settlement activities, it should be noted that gas market settlement is currently carried out based on daily allocations. The availability of actual gas consumption data can be used to enhance the accuracy of FAR (Forecasting, Allocation, Reconciliation) allocation factors. 7 Do you believe the Table 2 is a fair high level evaluation of how the SSM working assumptions align to the Design Principles? BGN Response to CER/13/151 Page 7 of 11

8 BGN believes that Table 2 is broadly a fair high level evaluation of how the SSM working assumptions align to the Design Principles. We have the following specific comments: Consumption Data: The provision of real-time consumption data to consumers over the Utility-HAN and the availability of consumption data on a Customer Web Interface on a next-day basis achieve good alignment with the Consumer Focussed principle. The availability of real-time data within the home and web access allowing deeper analysis provide the consumer with the tools to effect change in their energy consumption behaviour. In addition we note that the proposed delivery mechanism for interval data is a costefficient solution, leveraging existing market messaging systems. Prepayment: BGN agrees that the prepayment solution proposed under the SSM aligns well with most of the design principles. It offers common account balance processes for credit/prepay customers with Suppliers holding the most current version of the prepay balance position. The commonality of the meter functionality for credit/prepay customers could lead to a more cost-efficient solution. BGN believes there are some challenges regarding the cost-efficiency of the SSM model when applied to gas prepayment. The SSM model proposes a solution whereby pre-payment status information is held on back-end systems rather than on the meter. This model requires robust communications to guarantee daily delivery of interval data to back-end systems from the meter and reliable transmission of any disconnect/reconnect commands from back-end systems to the meter. The final communications link from the smart electricity meter to the smart gas meter is likely to be less resilient than other elements of the AMI given that it will be a low power radio wireless link. An adoption of the SSM model for gas prepayment will require the implementation of field response activities when an interruption of the communications link to the gas meter prevents the completion of certain business processes, for example site visits to resolve communications issues within a certain time period of diagnosis of such issues site visits to disconnect/reconnect gas supply if a communications issue prevents this being achieved remotely BGN Response to CER/13/151 Page 8 of 11

9 The requirement for these interventions would impact the operational costs for gas prepayment under the SSM model. The frequency of occurrence of these interventions could be minimised by imposing a high requirement on the reliability of the radio link as assessed at the time of installation of the smart gas meter. This would mean that the smart gas meter would only be installed at sites where the radio link to the smart electricity meter could be proven to be highly robust at the time of installation. The use of repeater technology (subject to availability) to boost communications performance could also be used where appropriate. Site visits could also be required for revenue protection reasons to address instances of interference (tampering) with the radio link to the smart gas meter. The adoption of measures to discourage tampering with smart gas meters would help to minimise the requirement for such visits. 8 Do you believe Table 3 represents appropriate working assumptions that reflect alternative ways of delivering certain critical functions of the SSM? Section 5.4 of the consultation paper states that the alternative data flows and processes may be required within the SSM to allow for Workstream requirements or as part of a Transition phase towards the SSM. BGN would not support the adoption of these alternative flows/processes during a Transition phase as this would require building two solutions to implement the functions involved one for a transition phase and another as the end-state. Taking the example of Prepayment it would clearly not make sense to employ a thick meter solution for a transition phase and a thin meter solution for the end-state. For the remainder of our response, our comments on the alternative working assumptions are made in the context of they being alternative methods of implementing SSM functions rather than being applicable in a transition phase. The alternative working assumptions would have to be progressed to a further level of detail to allow the business requirements of the solution to be developed. We have the following specific comments: Stakeholder Roles: Given that the alternative working assumptions involve sending price information over the SMA this would involve a change to Stakeholder Roles in that the Networks companies would now be required to be a conduit of this information, receiving it from Suppliers before transmitting it onwards over the SMA to the Smart Meter. 9 Do you believe Table 4 is a fair high level evaluation of how the alternative working assumptions align to the Design Principles? BGN Response to CER/13/151 Page 9 of 11

10 BGN believes that Table 4 is broadly a fair high level evaluation of how the alternative working assumptions align to the Design Principles. We have the following specific comments: Cost Data: In BGN s view there are a number of challenges regarding passing tariff information traffic over the Smart AMI when compared to the SSM model and in particular when compared to the Cost Efficient and Irish Market Context Design Principle. We see this as an enduring solution if put in place as a transition step i.e. the cost and effort in delivering this capability will be a disincentive to ever moving towards more flexible alternative media channels in the future. Allied to the fact that the solution will be constrained by the capabilities of the HAN protocol chosen, BGN feels that this approach may inhibit future innovation in the Irish Market. Shippers in a deregulated market who should be autonomous in flexing tariffs may now be constrained by the end to end process capabilities in place with regulated network operators in sending costs to the home. Depending on how dynamic gas tariffs may become, there could be a significant impact on existing gas market systems and internal BGN systems. This would arise if these systems were required to process high volumes of tariff messages with minimal latency, including the sending of delivery confirmation messages to the originating Shipper. Such a capability would likely require the procurement of additional systems leading to increased capital and operational costs. It is unlikely that BGN would be able to meet onerous SLAs in this space if cost in the home is to be anything more than indicative for the consumer, given difficulties in guaranteeing delivery across a large estate of shipper customers for a given cost implementation date. BGN Response to CER/13/151 Page 10 of 11

11 Prepayment: In BGN s view there are a number of advantages and disadvantages which the alternative working assumptions would bring to bear on prepayment when compared to the SSM model either model effectively involves a choice between the customer or the supplier having the most current knowledge of the balance position the alternative model would require complex reconciliation steps in supplier back-end systems the alternative model would require more complex functionality in the Smart Meter which could lead to increased costs The alternative working assumption regarding prepayment could, in BGN s view, lead to fewer field visits being required than under the SSM model for gas prepayment. The alternative working assumptions would lead to the adoption of a thick smart gas meter which typically supports the application of credit directly to the meter in the event of a communication failure, thereby avoiding a site visit. 10 Do you agree with the conclusion presented in Section 5.6? If Yes or No, please provide supporting commentary. BGN broadly agrees with the conclusion presented in Section 5.6. In our view the SSM and associated working assumptions offer a solution which will deliver on the strategic objectives of the NSMP and in particular those objectives which are relevant for gas (Encourage Energy Efficiency, Enhance Competition and Improve Consumer Experience and Improve Network Services). The SSM achieves good alignment with the Design Principles and allows Stakeholders to fulfil their roles as outlined in Figure 1 of the consultation paper. As outlined in our response to Question 7, the SSM working assumptions, as applied to gas prepayment, do present some challenges regarding the cost-efficiency of the solution. The impact on operational costs can be minimised by only installing smart gas meters at locations where a reliable radio communications link is viable, the potential use of repeater technology and adopting robust Revenue Protection measures. BGN Response to CER/13/151 Page 11 of 11