Who said dragons can’t dance? 1

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A success story on european smart meters, developed and produced in china
PART 1 of 3 by Alex Bouw, Jan Oost and Stephan Gibiino

How it started: Schiphol airport, The Netherlands, December 2010: Netbeheer Nederland working group DSMR launches its newest release of the Dutch Smart Meter Requirements (DSMR). Two Dutch IBMers are in the meeting room together with 37 other smart meter vendors to witness the occasion with enthusiasm and curiosity and see what this development could bring for their innovation agenda and for IBM´s global strategy to build a smarter planet.

IBM, is that Big Blue working on mainframes, computers and software…? Well not only that. With a strong belief that more and more of our world will be equipped with smart sensors, interconnected with systems and made intelligent – IBM brings innovation power to the table. As a result, in mid-2011, IBM together with a strong Chinese development and manufacturing partner, Shenzhen Kaifa Technology Co., Ltd., were selected as one of the suppliers for the development and delivery of the latest generation electricity meters that meet DSMR. This means that for the first phase rollout and on behalf of all Dutch distribution grid operators (DSOs), IBM will deliver meters as one of the four preferred suppliers (together with Landis+Gyr, Itron and Elster; Landis+Gyr and Itron for both electricity and gas meters, IBM and Elster respectively for electricity and gas meters only). The product development, contract negotiations with Netbeheer Nederland and pricing were started soon after. IBM qualified for this project due to – among other factors – the development and product capabilities of Shenzhen Kaifa Technology Ltd, a large and renowned original equipment manufacturer in all kind of electronics, including metering systems for electricity, gas and water. And YES, this Chinese Dragon, with its European partner, can dance.

IBM´s cooperation with Kaifa had already existed for over 15 years with a history in manufacturing for hard disc drives. For the past 8 years, IBM has also had a strong collaboration in the area of smart meter developments and mass metering deliveries. Now, with this latest success story for The Netherlands, Kaifa has been able to develop a private owned branded meter product for the European market, whereas in the past the company acted as an OEM with a third party owning and reselling the intellectual property. This quite unique and new position of Kaifa´s brand in Europe was enabled by the resumed model of cooperation with IBM. Now, as of July 2013, IBM and Kaifa are the first smart meter vendor to fully comply with DSMR4 (version 4 of DSMR) requirements with an accepted single phase and polyphase electricity meter product and an audited and released production process since July 2013.

Smart metering in The Netherlands is like that for the majority of European countries, originating in European legislation that was initially driven by the necessity to change the European energy market model. This changing energy market, as it was argued, requires a modernization of the European energy infrastructure, which in itself requires the introduction of more intelligent meter systems. On the European level this principle is agreed in two Directives – the Energy Services Directive (2006/32/ED, ESD), and Third Energy Package and more particularly the Directive on the internal electricity market (2009/72/EC).

Modernization of the electricity grids is the key for the integration of highly volatile sources of electricity such as local and large scale wind and PV. An intelligent grid does not stop at electricity production but includes flexible customers that help to balance demand and supply. Because it is said that more intelligent meters are essential for the DSOs’ grids of the future, let’s see what this future grid looks like, following the US Department of Energy (DOE) definition:

• Be able to heal itself – anticipate, detect and respond to system problems in the network, and avoid or mitigate power outages, power quality problems and service disruptions
• Motivate consumers to actively participate in operations of the grid
• Resist attack
• Provide higher quality power that will save money wasted from outages
• Accommodate all generation and storage options
• Enable electricity markets
• Optimize assets
• Enable higher penetration of intermittent power generation sources.

It is clear that more intelligence seems the prerequisite to fulfil these characteristics. Although a lot of definitions exist on what a more intelligent “smart” meter should look like, the common understanding seems to be that this generation of meters, which are digital instead of analog and support 1 or 2 way communication, have some new features like anti tamper, optional breaker, local communication ports for HAN, wired and wireless ports for other energy metering points, register logs etc., all with highly secured communication.

It´s obvious that not only forces driving the positive side of acceptance exist. The downside of introducing smart meters is mainly represented in e.g. social discussions on privacy and more technical discussion on security and radiation. Since a new generation of meters will be on the intersection between public energy networks and customer premises, additional information and communication technology is introduced. This increases risks.

These risks are (to be) assessed and mitigated by DSOs. In general the proposed smart meter infrastructure in The Netherlands is described in NTA 8130 from NEN (Nederlands Normalisatie Instituut) and in DSMR4. Privacy and security requirements are an integral part of this, although the level of requirement is a mix of functional and technical requirements.

It is obvious that for new smart meters one of the objectives is to protect the privacy of the customers and to fulfil requirements related to WBP (Wetboek Bescherming Persoonsgegevens: the Dutch Act in Constitution to protect personal data). For this reason, privacy and security guidelines were already agreed within Netbeheer Netherlands by 2010 and the code of conduct has been proposed to and was accepted by the “College Bescherming Persoonsgegevens” (CBP), a Dutch institution guarding privacy for citizens and advising the Ministry of Justice in privacy related cases. These discussions are likely to continue and privacy and security requirements are likely to be maintained as the technology is maturing.

(Part 1 will continue in part 2 & 3)