UK government announces €5.22bn investment in smart meter network and data services

The government of the United Kingdom has announced up to €5.22 billion in seven to nine year contracts, to build a wide area network and data services, to support smart meters.

Smart meters are mandated to be in place in the UK by 2020, which will result in the installation of a total of about 47 million devices. In many parts of Europe and the USA, the question of managing the data coming from meters is still up for debate. In the UK however, a central data and communications company (DCC) has already been established to oversee access to the data. The government itself will ensure the security of that information and foot the bill for the WAN deployment, instead of the utility companies. 

GSM/GPRS has a firm footing in the UK due to cost and ease of use, so the contracts could be a boon for telecoms operators, who are eager to enter the smart grid market.

“It’ll be interesting to see how cellular takes root, seeing that the UK is the first proponent of it, while other European countries have adopted the prime PLC standard,” said David Leeds, Senior Manager of Smart Grid for GTM Research.

The UK’s Department of Energy and Climate Change have stated that the WAN services will include: telephone and data transmission services, IT services, consulting, software development, internet and support. Although the data services contract is a separate filing, one company could potentially apply for and win both bids.

The U.K. government has split the contracts into three geographical areas: northern Great Britain, including Scotland; central Great Britain, including Wales; and southern Great Britain. Applicants can bid for one or all lots. However, within regions, the UK government isn’t looking for piecemeal solutions. “The Authority does not expect to tender separate contracts to companies providing a particular solution within a lot, but will tender communications services contract(s) on a prime contractor basis for each lot,” the notice reads. Each of three contracts, which will last for nine to 15 years, will be worth €375 million to €1.74 billion.

The scope of the project calls for operator’s to have 100% coverage in the geographic region and to supply the communications module and connection back to a central data center specified by the DCC.

The IT services contract has some overlaps with the WAN contract, calling for “consulting, software development, internet and support, software package and information systems, custom software development services and data-processing services.”

Taking the data out of the incumbent utility companies’ hands is a first in Europe, according to GTM Research analyst Geert-Jan van der Zanden, and should help to instill consumer confidence in data privacy.

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