Energy and Climate Change CommitteeWritten evidence submitted by Silver Spring Networks UK and Ireland (SMR34)

About Silver Spring Networks

With more than ten years of experience, Silver Spring Networks is the leader in networking technologies that modernise today’s power grid. Through partnerships with major utilities worldwide, more than 13 million homes and businesses rely on our platform, software and services to improve their energy management and efficiency. Silver Spring Networks securely connects consumers and utility providers through powerful and proven energy networks that are safe and can be easily expanded as needs evolve. Our client base consists of thirty valued organisations on a global basis, including many of the world’s largest innovative energy companies delivering smart metering and grid deployments in partnership with their consumers.

Our open, standards-based networking solutions enable all energy devices, from in-home energy devices to smart meters to load control devices, to connect together to deliver the highest performance possible.

Building upon our extensive global experience, Silver Spring is committed to the UK energy sector as one of the world’s first fully competitive, consumer-focused markets. The UK energy market continues to innovate through infrastructure and renewable generation rejuvenation, transformation of markets to meet the needs of investors and consumers, and innovation in the emergence of decentralised community-based energy models. Silver Spring has established a growing team, blending our global experience with UK sector experience, allowing us to offer our solutions as an enabling platform and proven delivery partner, who is ready to underpin the smart evolution of the UK energy sector.

In our UK work we are bidding as a primary delivery partner to a candidate Communications Service Provider (CSP) to the Data Communications Company (DCC) establishment as part of the Smart Metering Programme. We are also working with multiple Distribution Network Operators (DNOs) on their Low Carbon Network Fund (LCNF) projects, exploring new innovative models of energy network operation.

Information about our company, along with relevant white papers and client experience, is available from our website at:

1. The Smart Metering Roll-out Programme

The complexity for the UK of a disaggregated delivery model deployed on a Supplier led basis introduces enhanced requirements compared to the Distribution led models of some other countries. This also introduces opportunities for enhanced consumer engagement and innovation in consumer benefits through the use of consumption data and demand side services.

Realisation of consumer and wider grid benefits from the use of smart meter data depends on the trust of consumers in their energy Supplier, the Supplier’s delivery partners and the wider energy sector as a whole. Consumers need to trust that the roll-out will enable them to identify where and how they can control their costs through demand changes, competitive market choice and investment in their built environment. Central programmes can appear remote from the interests of consumers with awareness delayed and trust not achieved in time. The UK energy sector is seeking to renew the trust of energy Suppliers and consumers such as through the Retail Market Review (RMR), but paradoxically multiple sector initiatives can cause consumers to disengage.

The central communications aspects of the Smart Metering programme are therefore vital to its success. As the central communications aspect of the SMIP has not yet been launched there has not been any consistent consumer engagement across the energy sector. It is therefore difficult to affirm the level to which consumer concerns are being addressed. As there is only partial awareness of smart metering and an inconsistent understanding of what it means, it is almost certain that consumers are not yet aware of what concerns they might have. Most consumer concerns identified today are in response to media stimulus.

We note that the government has sought to create a wider basis for trust with consumers in the use of their data through the Midata scheme, but consumer awareness of this is low and it is not clear how this turns into consistent practical cross-company approaches at a sector level with regard to smart metering and later smart grid.

Similar communications initiatives, such as the UK Digital Switch Over, were highly successful but these related to the continued access to highly regarded TV content and enhanced functionality at no or little extra perceived cost. Smart Metering could be perceived as an imposition, offering little benefit but giving those outside the home insight into it. Where consumers see benefits such as in the remote programming of TVs via applications on smartphones they will trust the provider and assume the appropriate privacy and security is in place. But for smart metering this may not be the case and

Silver Spring has experienced global precedent of issues such as privacy causing delays in the Netherlands and the introduction of Time of Use Tariffs causing pause in Australia for their roll outs.

Silver Spring Networks observes that the relationship of the energy sector with consumers in the UK is under strain. We are engaging in initiatives such as decentralised energy so that consumers have a sense of ownership, participation and control over their energy infrastructure and costs as a community. At its simplest, consumers should feel informed, in control, valued and empowered by the smart metering deployments in a way that does not demand their extended time, attention, effort or cost contribution.

2. SMIP Timescale

The timescale for delivery of the SMIP is becoming compressed as the preparatory work extends but the delivery timescales do not. We support an accelerated roll-out to deliver early benefits and in our experience it is important that consumer engagement on a consistent, centralised basis commences at the earliest opportunity and that energy suppliers with their delivery partners believe the timescales, process and basis are now firm. The mandate and the opportunity are strong but the longer there is before rollout commencement on a consumer trusted basis, the more potential there is for added complexity to emerge that could undermine achievement of the timescales.

For example, there has been an extended industry discussion as to whether wider smart grid related benefits should be incorporated into the SMIP design. Although the smart metering specification and data is of use for wider smart grid benefits, specific design for these requirements was not included in the SMETS. Any further delay could cause the design specifications to be reviewed which could then further delay the roll-out.

Across the sector there is no wider consistent understanding of the UK evolution from smart metering to smart grids and smart markets at a time of concurrent government programmes in the energy sector. The potential is great if these changes are delivered and converge towards an evolved model for a smart market and grid, but the potential for overlap and subsequent delay remains.

The delivery timescales for SMIP are challenging and will become more so until the UK moves into delivery at scale, but with clarity of requirements for the delivery baseline, commitment to mobilisation and building on proven experience, benefits can be delivered early and momentum for a successful delivery on a basis trusted by consumers established.

The scoping, specification and preparation for the smart metering deployment has now been in progress for approaching three years. During this time and since the original business case in 2006, the technological basis of society has evolved quickly. For example, consumers now proactively adopt internet tablets and smart TVs that did not exist at scale five years ago. Companies such as ours building future proof capabilities to underpin smart metering and smart grids understand the pace of technology change in our society and design their platform to be standards based and using internet connection protocols to create a solution basis that evolves as technology does.

The choice of smart metering communications technology is important to ensure that we are not building upon methods that are rapidly being replaced and will then become legacy solutions supported for the last series of users at high cost. In the next ten years the UK government Low Carbon Roadmap to 2050 envisages such new requirements as decentralised community energy at scale, electrification of heating and transport, the evolution of the UK generation mix and active demand management. So whilst it is important to ensure the implementation basis is stable and proven, it is also important to ensure the platform can adapt with future requirements and support a range of connections that cannot yet be defined.

The new DCC for smart metering sits at the heart of this evolution as a new central infrastructure that should be able to extend and meet emerging future needs. The choice of communications and platform in the Communications Service Provider (CSP) requirement is therefore a key decision that should create future enablement and innovation. The release of spectrum by OfCOM in good time to support the smart metering programme as defined in the SMETS2a baseline is a key underpinning requirement that we believe is important to a successful roll-out.

Alongside the LCNF, Zero Carbon planning obligations, decentralised production, community projects and local authority energy partnerships under the Localism Act are starting to simulate new smart requirements for local energy networks. There is clear separation and focus between the central technical requirements of the SMIP and these other initiatives but over the long term we envisage convergence around a common definition and model for the UK smart grid(s). We therefore encourage DECC to bring commonality, consistency and future technical enabling to emerging UK energy requirements. The CSPs that are deployed should have the flexibility and capacity to cost-effectively support not just smart metering, but smart grids and smart city applications. The UK is making a long-term investment and value (and not just cost) needs to be a strong consideration. With an investment in the right architecture and infrastructure, the UK can extract option value for years to come.

3. Consumer Benefits and Awareness

Independent research shows that about half of all consumers are aware of the existence of smart meter technology. However there is confusion within this as to what a smart meter is. Over recent years some consumers have had experience of clip on devices with rudimentary text based visual displays or non-SMETS compliant advanced meters (with one way communication) being installed for some consumers. Leading energy suppliers have used a “smart” branding in their advertising but without defining what this means precisely. Therefore there may be a strong gap in perception amongst consumers in what the smart metering delivered through SMIP is, how it will work and what it means to them.

There has already been some media criticism as well as consumer bodies commenting on the roll-out model, but as yet no consistent communication with consumers or an underpinning central communication programme. Our experience in the USA shows a strong campaign of explanation, engagement and promotion is required over an extended period, ahead of, during and after the roll-out with the focus moving from implementation, through initial operation into the enduring benefits realisation and expansion of services offered to consumers with their authorization to use the data.

We believe that the delivery of smart meters is a partnership between consumers, energy suppliers, government, the wider energy sector and enabling companies such as ourselves. This partnership must keep consumer benefits at the forefront of the business case to secure and retain trust and mandate for the delivery and the use of smart meter data.

It is imperative that the benefits of smart metering are achieved by all consumers, not just those already informed and engaged. Of particular focus will be helping consumers identify how to save money and to target communications for those in most need such the fuel poor, vulnerable, elderly, competitively disengaged and in energy inefficient properties. An approach that brings together government policies such as the use of smart metering data to help inform considerations under the Green Deal will help bring clarity and simplicity for consumers.

Although the roll-out timing across customer groups is a matter owned by the energy Supplier in the UK, we believe there will be a need for co-ordination between Suppliers, their agents and the new central DCC providers (particularly the CSPs who provide the Communications Hub to the Supplier) to achieve an efficient deployment. As such we welcome the Government’s plan to establish a Central Delivery Body to coordinate this.

We also note that consumers’ baseline technology literacy is evolving more quickly than many industries can support in their engagement. In-Home Displays (IHDs) are an important part of the mandated Smart Metering System for domestic consumers but we recognise that many consumers may seek to use online tools on the platform of their choice ranging across PCs, internet tablets, smart phones and smart TVs. In other markets a central consumer portal is deployed that enables them to see their energy consumption consistently whichever Supplier they are with and enables easy comparison.

4 Lessons from Consumer Engagement in Other Markets

We assert that a complete shift in the way we perceive and use our energy resources is required and that we need to work in collaboration with consumers to achieve this. On 29 January we were integral in the USA launch of the “Power over Energy” campaign, which explains energy for consumers and gives practical tips as to the ways they can reduce their consumption now and in the future.

As part of our approach to building consumer awareness and engagement Silver Spring Networks publishes a range of white papers, customer testimonials, video and supporting information which we believe is helpful in understanding the benefits being realised through smart energy deployments underpinned by our platform. These can be viewed at

We also believe there could be benefits of producing a simple “UK energy roadmap” that brings together the various policies and delivery programmes such as Retail Market Review, Electricity Market Reform, the Green Deal and Smart Grid to show how these are focused on helping consumers meet their energy needs at the most efficient cost while decarbonizing, increasing resource sustainability and being technologically empowered. There are detailed explanations in many government, DECC and OfGEM documents but there does not appear to be a cohesive narrative that all consumers have seen and understand, that places the industry changes into a meaningful context for them and therefore increases trust.

As part of our commitment to engagement and outreach, Silver Spring Networks was the first company to produce a Smart Energy Future Curriculum which we made available freely to schools. This is designed to help teachers, students, their families and communities understand how the smart grid can address the nation’s energy challenges. It also enables students to see how the smart grid may present career and professional opportunities in a fast growing, technological industry and be on the cutting edge of a worldwide energy transformation. We also work globally with Non-Government Organisations such as Global Green, The National Religious Partnership for the Environment, and the National Council of Churches to raise awareness of smart energy and its benefits.

Consumer engagement is core to our approach and we look forward to supporting the communication activities of the SMIP and beyond in the UK’s smart energy transition.

5 Commercial Benefits of Smart Metering

Silver Spring Networks is committed to realising the benefits of its platform and experience for the UK energy market and is making a growing investment in the UK energy sector. Our company is already bringing in experts from the UK market to complement our expanded team and will be opening an office during Spring 2013. We are also exploring the UK as a manufacturing and distribution centre for our technologies. We intend to be an active participant to the UK energy sector and use it as a global showcase for other markets.

Once deployed, smart platforms provide a basis for wider benefits in such areas as network demand automation, consumer demand response, renewables generation connection, optimised management of street lighting, enablement of electrical vehicle charging, transition for business consumers away from legacy metering communications and enhanced consumer engagement. Therefore through the smart metering implementation we believe the foundation for smart grid benefits can start to be established inherently and cost effectively.

Over time we believe there is merit in abstracting the technical complexity of meters and network connected devices away from the realisation of operational benefits through a focus on standards based communication and integration of technologies. This will enable the introduction of innovation such as by Suppliers or Distribution Network Operators. The technology will need to last as well as be optimized to deliver the requirements as well as begin to enable the smart grid. We would therefore be keen to engage on a process of transition that identifies and realises progressive operational benefits through the use of solutions that were designed from the start to allow cost effective innovation in the long term.

The business case for smart metering developed by the UK Government identified over £7 billion of net benefit. For those working in smart grid enablement the case was widely seen as modest in its ambitions and that wider consumer, societal and economic benefit could be realised through the right basis and approach. While the original business case was key to achieving a mandate for the roll-out, we believe a wider UK smart grid benefits roadmap that builds on the benefits of the SMIP and includes wider benefits for distribution, generation connection and planning, consumer empowerment and their “smart life”. By mapping the benefits to planned stages of exploration and introduction, the UK could achieve progressively enhanced return on the investment and realise the full benefits. We also believe the benefits are not limited to electricity and gas, as establishing the central DCC provides a basis for benefits such as in smart water and the “internet of everything” machine to machine communications.

Smart metering is not a “fit and forget” technology and the continued focus and action by those who are dedicated to its benefits are a key component of success. In our work with governments, utilities and regulators we therefore have a specialist team that produces an analysis of the benefits that can be realised through smart metering deployment. These benefits start with consumer demand reduction and operational efficiencies but also extend into grid optimisation and market level benefits quantification. The output benefits model is then used by our customers to test the progress and delivery of the agreed benefits case, some of which are delivered through the deployment of our value as part of the roll-out. If helpful we would be pleased for our business case modeling team to take the Committee through our approach and how benefits are evaluated in delivery.

February 2013

Prepared 26th July 2013