SSE gears up for smart metering revolution

Published on Saturday 14 November 2009 12:09

SCOTTISH and Southern Energy is seeking tenders to design a new data house to prepare it for smart utility metering.

Britain's second largest gas and electricity retailer typically reads its customers' gas and electricity meters four times a year. But smart meters, which are set to be rolled out across Britain over the next decade, will be capable of providing readings every 30 minutes.

While the new meters promise more accurate billing, utilities will face dealing with thousands of data readings from each meter annually. The new data storage facility being planned will eventually collate billions of pieces of data from the meters into a format for individual account billing.

Chief executive Ian Marchant said the next decade, when customers are transferred from old "dumb" meters to those providing remote readings, would be a challenge, but the move was necessary and inevitable.

"The difference will be like the changes we've seen in telephony, going from the 1980s, where you were just told how many minutes you had used, and today, where everything is itemised and broken down."

The cost of preparing its systems for smart meters was "likely to be a seven-figure sum, possibly eight", Marchant said, suggesting a bill of around 10 million.

SSE is also investigating how to limit its exposure to the wholesale gas markets, a move likely to see it buy stakes in North Sea gas fields. The Perth-based group buys most of its gas on the spot market, but also has long-term fixed price contracts with production firms. A large chunk expire next year.

Marchant said he would consider signing more long-term contracts with gas producers, while SSE has also looked at "more than ten" packages of assets which have been put up for sale in the North Sea.

Unlike larger rival Centrica, which bought Aberdeen-based Venture Production for 1.3 billion this year, SSE does not want to become a gas producer.