National Smart Metering Program Memorandum Smart Metering Program File Name: Memo 20090901 v1.0.docx...
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National Smart Metering ProgramNational Smart Metering Program
File Name: Memo 20090901 v1.0.docx Security Classification: Unrestricted
National Smart Metering Program
Memorandum To: Interested Parties From: NSSC Secretariat Date: 2 September 2009 Dear All The purpose of this covering note is to advise interested parties of the National Smart Metering Program (NSMP) that the content contained within the following document does not contain the latest information of the NSMP deliverables and schedules.
As the NSMP program of work has evolved, reporting on deliverables (and any changes to the deliverables, as endorsed by the NSSC) has been reflected in individual status reports for the work streams.
Interested parties are referred to the status reports for the current list of NSMP deliverables and schedules.
Kind regards
NSSC Secretariat
National Smart Metering ProgramNational Smart Metering Program
National StakeholderSteering Committee
NSMP DeliverablesSpecification
Version number: Version 1.0
Status: Final
Author Harry Koller, Program Director
Date published 28 November 2008
File name NSMP_Specification ofdeliverables_v1.0.doc
Table of Contents
1 DOCUMENT CONTROL .......................................................................................................................... 3
1.1 VERSION CONTROL ............................................................................................................................... 31.2 APPROVAL ............................................................................................................................................ 3
2 INTRODUCTION ....................................................................................................................................... 4
2.1 BACKGROUND....................................................................................................................................... 42.2 PURPOSE OF DOCUMENT........................................................................................................................ 4
3 SMART METERING INFRASTRUCTURE SCHEMATIC .................................................................. 5
4 IDENTIFICATION OF DELIVERABLES............................................................................................... 7
5 BUSINESS REQUIREMENTS WORK STREAM .................................................................................. 8
6 BUSINESS PROCESSES AND PROCEDURES WORK STREAM.................................................... 13
7 PILOTS AND TRIALS WORK STREAM ............................................................................................. 15
8 REGULATION WORK STREAM .......................................................................................................... 16
9 RECOMMENDATION............................................................................................................................. 18
APPENDIX A GLOSSARY ....................................................................................................................... 19
APPENDIX B MCE OUTPUTS AND RELATED WORKSTREAMS ................................................. 21
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1 Document Control
1.1 Version Control
Version Date Description Amended by:
0.1 23/10/2008 Initial Draft for NSSC Review andApproval by H. Martinson
H. Martinson
0.2 27/10/2008 Amended draft for NSSC review andapproval by H. Koller
H. Koller
0.3 12/11/2008 Amended draft in response to feedbackfrom NSSC members
Change document name
Remove diagram
Remove all examples of functionalrequirements
Move recommended NEM proceduresfrom Regulation to the Business Processand Procedures work stream.
Incorporate NSMP Work Plan deliverablenames into this document to haveconsistency with the NSMP Schedule.
H. Koller
0.4 26/11/08 Revise for NSSC comments and changesmade to ensure consistency with theWorking Group terms of reference
Revise for NSSC feedback received byCOB 25/10/2008
H. Koller
1.0 28/11/08 Baselined post approval by NSSC H. Martinson
1.2 Approval
Authorised by Signature Date
NSSC
Program Director
28/11/2008
MCE
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2 Introduction
2.1 Background
The Ministerial Council on Energy (MCE) has endorsed the rollout of smart metering, where the
benefits outweigh the costs, in order to enable consumers to make more informed choices and
better manage their energy use and greenhouse gas emissions, reduce demand for peak power
with potential infrastructure savings, and drive efficiency and innovation in electricity business
operations and retail market competition.
The National Stakeholder Steering Committee (NSSC) has been established by the MCE to
establish a national framework for the rollout of smart metering infrastructure (SMI) including
technical and operational requirements and changes to regulatory rules and procedures in the
National Electricity Market, Western Australia and Northern Territory.
The NSSC is to have a timeline for the completion of this work agreed with the Ministerial
Council on Energy (MCE) by the end of December 2008.
The NSSC is to prepare a National Smart Metering Program (NSMP) Work Plan that will specify
the tasks and deliverables required to specify the smart metering infrastructure functional
specification and supporting regulatory framework. The NSMP Work Plan will include the
following documents:
a) NSMP Work Plan Executive Summary – provides a summary of the NSMP Work Plan
covering work streams, major deliverables and deliverable milestones
b) NSMP Deliverables Specification- description of the deliverables required under the
NSSC terms of reference
c) NSMP Roadmap - High level roadmap covering the period 2008 – 2012 which highlights
key milestones, dependencies both external and internal to the program, and swim lanes
used to denote the key program activities
d) NSMP Schedule – A detailed schedule of tasks and deliverables by work stream for the
period January 2009 to September 2009 (i.e. Gantt Chart and Word Table). The NSMP
Schedule will be maintained on a rolling 6 monthly basis (Note: NSMP Schedule will be a
roll-up of the detailed schedules maintained for the various work streams)
e) NSMP brief - documents the key inputs (e.g. previous MCE decisions, NERA Cost
Benefit study, NSSC terms of reference) to the NSMP and the expected outcomes (e.g.
Regulatory Impact Study) of the rollout of smart meters.
f) Program Management Plan - Program Management Plan (PMP) outlines how the
program will be managed, ensuring that all program/project management disciplines are
addressed
The NSMP Work Plan is scheduled to be approved by MCE at its meeting on 12 December
2008.
2.2 Purpose of document
The purpose of this paper is to provide the definition of deliverables for the National Smart
Metering Program which is consistent with the NSSC’s terms of reference. Appendix B maps the
NSSC terms of reference against this specification of deliverables.
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The NSSC Secretariat has prepared this document drawing upon the information contained in
the following documents:
a) MCE Decision paper - A National Minimum Functionality for Smart Meters -13 December
2007
b) Smart Meter Decision paper – MCE 13 June 2008
c) MCE – Statement of Policy Principles – 13 June 2008
d) Standing Committee of Officials of the Ministerial Council on Energy Cost-Benefit
Analysis of Options for a National Smart Meter Roll-Out (Phase Two – Regional and
Detailed Analyses), Regulatory Impact Statement For Decision, June 2008
e) Cost Benefit Analysis of Smart Metering and Direct Load Control – Final Executive
Summary – 23 May 2008, NERA Economic Consulting
f) Technical and Regulatory Working Group – Work Plan for delivery of the NSSC Outputs
– Version 0.9 – 13 October 2008
g) Victoria Advanced Metering Infrastructure Program – Operating Model – Requirements
Version (V0-3)
h) Minimum AMI Functionality Specification (Victoria) September 2008 Release 1.1
i) Minimum AMI Service Levels Specification (Victoria) September 2008 Release 1.1
j) In-Home Display Functionality Guidelines (Victoria) – 8 June 2007 – Version 3.0
3 Smart metering infrastructure schematic
An example of a schematic for the smart metering infrastructure is shown in diagram 1. This
schematic is not meant to imply a particular metrology technology or system arrangements. The
schematic is a work in progress and the intent is to refine this schematic in the development of
the national smart metering infrastructure framework.
smart metermanagement
system
HANsmartmeter
smart metercommunication
networkCD#2
Distributorenvironment
B2B/MSATSnetwork
hard wire control
CD#1
CD consumer’s device
in-homedisplay
supplyswitch
NEMMCOenvironment
Retailerenvironment
consumerremote
connectionexisting elementsnew elements
CD#3
eg: water heater
eg: air conditioner
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Diagram 1: Smart metering infrastructure schematic (Example)
The diagram shows the potential components of the smart metering infrastructure. The potential
components are described as follows:
a) Smart meter. This is the device at the heart of the infrastructure. The device would
function partly as an interval meter (to measure power flow into or out of the premise)
and partly as a simple housing for other control actions (for example: to turn a supply
switch ON or OFF, to turn a device circuit ON or OFF, and to pass through
communication signals to the HAN). The smart meter would have sufficient capacity and
speed to manage the transmission of signals to and from the smart meter management
system via the smart meter communication network (‘two-way traffic’). The smart meter
would have sufficient capacity and speed to manage the transmission of signals to
Consumer Devices via the Home Area Network.
b) Home Area Network (HAN). The HAN is represented partly by the consumer’s space
over which information is transmitted, partly by the transmission and reception
technology, partly by device identifier codes, and partly by the signal coding and
decoding rules that are applied to a signal that is to be transmitted over that space. The
space may include physical barriers such as doors, walls and windows. The space may
include all parts of a premise including inside and outside the dwelling. The space may
overlap with spaces of other consumers. Any pending interference arising from the
overlap would be controlled by the device identifier codes.
c) Consumer’s Device (CD). The Consumer’s Device is represented by any number of
physical devices that consume electricity (e.g. air-conditioning motor, swimming pool
pump, security light, stove/oven). In the diagram, these different devices are represented
by CD#1 (e.g. in-home display as described below), CD#2, etc. The ON/OFF operation of
some consumer devices could be controlled by signals transmitted over the HAN (e.g.
CD#2) or by hard wire switches within the smart meter (e.g. CD#3).
d) In-home Display (IHD). The IHD is represented by a special form of Consumer’s Device.
This device would be capable of flexible location within the consumer’s space, at a point
most convenient to the consumer. The device would receive signals (eg. retailer
messages to the consumer, such as changes in electricity price) from the smart meter
device over the HAN. The device need not be interactive. The information published on
the IHD must be able to be manually interpreted
e) Supply switch. The ‘supply switch’ is represented by a special purpose device that is
capable of turning ON and OFF the main circuit to the premise. This function would be
used by a distributor to disconnect and reconnect a consumer, if permitted under its
licence conditions and regulatory codes of practice.
f) Smart meter communication network (SMCN). The SMCN is represented partly by the
space or conductors (or a mixture of both) over which smart meter signals are
transmitted, partly by the transmission and reception technology for those signals, partly
by device identifier codes, and partly by the signal coding and decoding rules that are
applied to a signal that is to be transmitted over that space. The space will include the
electrical pathways that geographically connect a consumer’s premise to a central
database located at a remote location.
g) Smart meter management system (SMMS). The SMMS would have sufficient capacity
and processing power to manage two-way traffic with the smart meter. Similarly, the
SMMS would have the capacity and processing power to manage two-way traffic with
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NEMMCO (e.g. meter reading data, NEM spot prices), two-way traffic with retailers (e.g.
IHD display information, disconnection status), and two-way traffic with the Distributor
(eg. metering data, supply status, disconnect and reconnect actions).
h) Consumer remote connection – The customer would have the ability to remotely
activate or adjust appliances in the home from outside the home.
i) Existing components of the infrastructure. The existing components of the smart
metering infrastructure are as shown on the right hand side of the diagram. Although the
components are largely in place, some upgrading of these components will be necessary
to accommodate the desired functionality of the smart metering infrastructure. These
components include the distributor’s environment, the retailers’ environment, the
NEMMCO environment.
Overall, the national SMI framework should provide for an efficient, flexible and open-access
smart metering infrastructure that supports interoperability, permits adoption of new
technologies, minimises barriers to competition and interconnects energy businesses to deliver
reliable, accurate and timely energy metering data in a manner that supports emerging network
and energy management solutions.
4 Identification of Deliverables
In summary, under its terms of reference, the NSSC is to:
a) develop with the MCE a consistent national regulatory framework for smart meters in the
National Electricity Market
b) develop the technical and operational requirements and agree them with the SCO
c) develop and recommend supporting changes to the NER and NEM procedures
d) reach agreement on a national regulatory framework for SMI taking into account the
steps already taken by Victorian businesses
e) coordinate pilots and refresh business cases, share results, and optimise learnings
f) advise the MCE on a specific HAN standard, appliance standards to include in the HAN
standard
g) advise on the level of network demand management that can be achieved through direct
load control
h) advise whether guidelines are needed to support retailer innovation and compete in the
provision on IHDs
i) advise on the materiality of the risk that insufficient interoperability between different
meters, communications infrastructures and metering management systems may
introduce further market power risks or reduce competition in metering
j) propose service standards for access to the HAN to optimise innovation and take up
k) consider WA and NT deployment timelines to maximise efficiency
l) advise on the National Energy Customer Framework and safety regulations if required by
SCO
Based on this, the NSSC deliverables should be developed based on four work streams with the
following major deliverables. These are:
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a) Business Requirements Work Stream – Smart Metering Infrastructure Functional
Specification (e.g. defines business requirements, performance requirements and service
standards for the SMI)
b) Business Processes and Procedures Work Stream – NEM Smart Metering Infrastructure
Operating Model (e.g. identifies the procedures that require change to support SMI) with
modified processes/procedures for WA and NT. This work stream will also prepare, in
consultation with the relevant NEM reference groups, the recommended changes to NEM
Procedures for consideration by NEMMCO and enforceable procedures in the non-NEM
jurisdictions for consideration by the appropriate regulatory agency.
c) Regulation Work Stream - Regulatory requirements to modify existing regulatory
arrangements including changes to the National Electricity Rules (NER) and enforceable
regulations in the non-NEM jurisdictions to support the rollout of smart meters.
d) Pilots and Trials Work Stream - Pilots and Trials Work Stream – Co-ordinate pilots and
trials of business cases across businesses and jurisdictions. It is expected that the pilots
will reduce the range of uncertainty (particularly in jurisdictions with some risk of a net
loss at the lower end of the range of benefits) to inform whether a roll-out should proceed
and also inform the development of roll-out implementation plans to maximise benefits.
The NSSC Secretariat is recommending that four work streams is the preferred option in order to
ensure that the smart metering infrastructure is always addressed on an end to end basis. This
is consistent with stakeholder feedback provided to SCO in the Regulatory Impact Statement
(RIS)1. This will avoid “details slipping through the cracks” which might occur if the work streams
were organised around particular components of the infrastructure (i.e. Smart Meter or HAN).
Within a work stream, it may be appropriate to have a specialist sub-group to work with an SME
to define the more technical aspects of a particular infrastructure element. This sub-group would
report back to the main work stream group.
The specification of deliverables has been made around each of these streams of work. In
accordance with the RIS, the NSMP deliverables will only address stakeholders connected to
on-grid generation in the NEM, South Western Interconnected System (SWIS in Western
Australia), Darwin-Katherine networks (Northern Territory)2. The specification is scoped in
Sections 5, 6, 7 and 8 below, and together they form the ‘specification of deliverables’ to be used
in the NSMP Work Plan.
5 Business Requirements Work Stream
The objective of this work stream is to prepare recommendations on a Smart Metering
Infrastructure Functional Specification (“SMI Functional Specification”) that will provide electricity
businesses and consumers with the mechanisms that will enable them to potentially deliver the
expected outcomes of smart metering envisaged by the MCE and other stakeholders.
The Regulatory Impact Statement3 prepared by SCO sets out the expected outcomes of smart
metering:
1Standing Committee of Officials of the Ministerial Council on Energy Cost-Benefit Analysis of Options for
a National Smart Meter Roll-Out (Phase Two – Regional and Detailed Analyses), Regulatory ImpactStatement for Decision, June 2008, page 115.2
Op. cit., RIS, page 16.3
Standing Committee of Officials of the Ministerial Council on Energy Cost-Benefit Analysis of Options fora National Smart Meter Roll-Out (Phase Two – Regional and Detailed Analyses), Regulatory ImpactStatement for Decision, June 2008, page 32.
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“Reducing demand for peak power, with consequential infrastructure savings (e.g.
network augmentation and generation)
Driving efficiency and innovation in electricity business operations, including improving
price signals for efficient investment and contracting
Promoting the long term interests of electricity consumers with regard to the price,
quality, security and reliability of electricity
Promoting competition in electricity retail markets
Enabling consumers (including residential, business, low- and high-volume users) to
make informed choices and better manage their energy use and greenhouse gas
emissions
Manage distributional price impacts for vulnerable consumers
Promoting energy efficiency and greenhouse benefits
Providing a potential platform for other demand side response measures and avoiding
discrimination against technologies, including alternative energy technologies”
These objectives take account of COAG commitments, MCE policy direction, the market
objectives and consultation with stakeholders. Not all of the above objectives may be relevant to
SMI and the NSSC has a role to play in mapping the expected outcomes (objectives) to the
enabling functions.
Once the mapping of SMI enabling functions is completed, the NSSC will specify the minimum
business requirements, minimum performance requirements and minimum service standards
for the smart metering infrastructure. The proposed definition of these terms is as follows:
a) Business requirement – describes the functionality required and any variables associated
with requests for the service together with the components of infrastructure that are
required to perform the requested service. For example – the smart meter is required to
support the “opening of the supply contactor, either remotely or locally”).
b) Performance requirement– describes the outcome required for the components of the
smart metering infrastructure but excludes upstream or downstream systems. For
example – performance level for remote reads of individual meters – “Action performed at
90% of meters within 30 minutes”.
c) Service standard – describes the quantity and time required to complete a “service
request”. For example, Routine Read- Remote – no less than 95% being actual data from
meters to be available by 6 am the following day”.
The SMI Functional Specification should contain the full set of business requirements,
performance requirements and service standards for each component which must be met in
order for that component to be classified as functionally adequate.
In developing the SMI Functional Specification, the NSSC will:
a) Develop and recommend technical specifications, performance requirements and
amendments to functions, based on a sound benefits case which meets the key criterion
of maximising net benefit across different stakeholder groups
b) Develop and recommend service standards, including analysis of cost implications
c) Consider any related decisions arising from Phase 2 of the cost-benefit assessment
(NERA report)
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The work on the SMI Functional Specification will address the following matters raised in the
NSSC terms of reference:
a) Item (m) provide timely advice on detailed national minimum functionality for smart
meters to maximise benefits across all stakeholders - this includes functions referred by
MCE to a technical stakeholder group, to develop and advise on technical definitions,
performance and service level requirements and relevant National Electricity Rules. The
starting point for this analysis should be the Minimum National Meter Specification shown
in Table 1 below.
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Table 1 National Smart Meter Minimum Specification
Source: Standing Committee of Officials of the Ministerial Council on Energy Cost-Benefit Analysis of Options for a
National Smart Meter Roll-Out (Phase Two – Regional and Detailed Analyses), Regulatory Impact Statement for
Decision, June 2008
b) In relation to the item (m) – National Smart Meter Minimum Functionality for Function 12
Remote connect/disconnect and Function 13 Supply Capacity Control the NSSC is to:
Advise on consumer protection arrangements for these functions when requested
by SCO as part of the MCE’s National Energy Customer Framework review.
Advise on safety regulations that might impact on the availability of these
functions when requested by SCO as part of the MCE’s Safety review.
c) Item (n) recommend to the MCE how direct load control capability can be integrated into
priority appliances - this analysis should be undertaken in conjunction with the existing
appliance energy standards work currently being conducted by both the Equipment
Energy Efficiency (E3) Committee of the National Framework for Energy Efficiency, and
Standards Australia
d) Item (p) advise the MCE on whether there is a need to provide guidelines to support
development of the in-home display market4
4The advice should specify the nature of the function to be included in the smart meter along with advice
on service standards to encourage the uptake of in-home services and whether there is a need to provideguidelines to support development of the in-home display market. Encouraging uptake may also involvesome sort of incentive structure built into prices. If so, then there may be a need for the Regulation Work
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e) Item (q) propose to the MCE defined service standards for access to the HAN to optimise
innovation and uptake of in-home services
f) Item (r) advise the MCE on the whether insufficient interoperability between different
meters, communications infrastructures and metering management systems may
introduce further market power risks or reduce competition in metering - in particular:
(i) the materiality of this risk
(ii) international progress on communications standards and practices to support
interoperability
(iii) the most appropriate framework to manage this risk in the Australian market
The NSSC understands that the definition of the business requirements, performance
requirements and service standards should be viewed as an iterative process within this work
stream whereby the business requirements should be defined first and followed by the
performance requirements and service standards. Once the performance requirements and
services standards are defined it may be necessary to revisit the business requirements until all
three definitions have been reconciled (in terms of trade offs of technical feasibility, costs and
benefits) and are consistent.
Indicative estimates of the costs and benefits for the SMI component in the SMI Functional
Specification will also be prepared. These indicative estimates will use as its starting point (e.g.
base line) the Phase 2 CBA study managed by NERA Economic Consulting5. Where better data
is available, it may be possible to update the Phase 2 CBA estimates. However the scope of the
work is to prepare indicative estimates only. The real work on developing the business case for
the SMI costs and benefits is to be performed on a voluntary basis by those companies electing
to prepare a detailed business case in each jurisdiction.
The final SMI Functional Specification will include recommendations on the following matters:
a) SMI Strategic Objectives: Mapping the MCE and other stakeholders’ SMI objectives to
the SMI enabling functions so as to confirm the required SMI minimum functions (e.g.
identify the mechanisms that will be required to deliver the SMI objectives)
b) SMI Components: Identify and confirm the SMI components to be included in the SMI
Functional Specification.
c) SMI Requirements: Specify the business, performance, and service level requirements
for the SMI components
d) Cost benefits analysis: Indicative cost and benefits using the Phase 2 CBA study
managed by NERA Consulting as an initial baseline.
e) Policy Advice:
Function 12 Remote connect/disconnect and Function 13 Supply Capacity
Control:
Stream to consider this in determining the pass through of the roll out costs so it can be built intodistributor tariffs.5
It is intended that CBA be an iterative process where the BRWG may at a later stage be asked revisit theSMI Functional Specification based on the outcomes of pilots and trials conducted by companies in eachjurisdiction or the implementation experience of the Victorian energy companies in their AMI rollout whichcommences in mid 2009.
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i. Advice on consumer protection arrangements for these functions when
requested by SCO as part of the MCE’s National Energy Customer
Framework review.
ii. Advice on safety regulations that might impact on the availability of these
functions when requested by SCO as part of the MCE’s Safety review.
Item (p) advise the MCE on whether there is a need to provide guidelines to
support development of the in-home display market
Item (q) propose to the MCE defined service standards for access to the HAN to
optimise innovation and uptake of in-home services
Item (r) advise the MCE on the whether insufficient interoperability between
different meters, communications infrastructures and metering management
systems may introduce further market power risks or reduce competition in
metering
6 Business Processes and Procedures Work Stream
The objectives of this work stream are to:
a) define the business processes and procedures in a NEM Smart Metering Infrastructure
Operating Model (NEM SMI Operating Model) required to deliver the SMI Functional
Specification. The NEM SMI Operating Model will define the cross industry processes,
interfaces and data flows that are needed to meet the smart metering infrastructure
requirements.
b) recommend the revised NEM procedures to support the delivery of the NEM SMI
Operating Model and enforceable procedures in the non-NEM jurisdictions.
The NEM SMI Operating Model should be developed in two levels with the Level 1 being
developed and approved by the NSSC before work commences on Level 26.
a) Level 1 Summary Process – a high level overview of the process defining the sub-
process
b) Level 2 Sub-Process – a detailed sub-process schematic identifying:
Inputs and outputs
Activities with roles and responsibilities defined for local network service
providers, retailers, retailers (FRMP), Responsible Persons, end use customers,
and NEMMCO
Business requirements (from the Business Requirements Work Stream)
Proposed changes to Enforceable Instruments – changes to the NER, MSATS
Procedures including Metrology Procedures or B2B Procedures
In developing the NEM SMI Operating Model, the NSSC may need to provide advice on the
changes to NEM Procedures required to address the following matters:
6Note: Some work may be required on Level 2 processes to correctly specify the Level 1 processes but
this will be minimised in order to get a NSSC endorsement of the Level 1 model.
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a) Advice on consumer protection arrangements for the remote connect/disconnect and
supply capacity control functions when requested by SCO as part of the MCE’s National
Energy Customer Framework review.
b) Advice on safety regulations that might impact on the availability of the remote
connect/disconnect and supply capacity control functions when requested by SCO as
part of the MCE’s Safety review.
c) Advice on access to and protection of Smart Meter data, in conjunction with the MCE’s
Consumer Protection and Safety Review.
After the NEM SMI Operating Model is developed based on the assumption of a distributor led
rollout7 it may be necessary to modify the model to cater for any unique requirements for
Western Australia and Northern Territory. It would also be necessary to modify the model at a
later stage to adjust for any changes to the “Responsible Person” following the end of the
mandate period for distributors in the NEM.
Following the completion of the NEM SMI Operating Model this work stream will prepare
recommended changes to the NEM Procedures. Some key NEM Procedures that are likely to
require changes are highlighted below.
a) Recommend changes to the supporting MSATS Procedures, including
Prepare a submission of the changes to NEMMCO and the advisory Retail Market
Executive Committee (RMEC) for their consideration and subsequent incorporation
in the relevant documents, subject to any related AEMC Rule changes proposal.
NEMMCO will process the changes in accordance with change procedures in the
NER.
b) Recommend changes to the supporting NEM Metrology Procedures.
Prepare a submission of the changes to NEMMCO and the Metrology Reference
Group for their consideration and subsequent incorporation in the relevant
documents, subject to any related AEMC Rule changes proposal.
NEMMCO will process the changes in accordance with change procedures in the
NER.
c) Recommend changes to the supporting B2B procedures taking into account the B2B
Objective and B2B Principles.
Prepare a submission of the changes to the Information Exchange Committee (IEC)
for their consideration and subsequent incorporation in the relevant documents,
subject to any related AEMC Rule changes proposal.
The IEC will process the changes in accordance with the change procedures in the
NER.
It should be noted that according to the RIS, there will be a need for NEMMCO to administer two
sets of MSATS and B2B procedures with staged or partial rollout of the smart metering
infrastructure:
“The main implications of not rolling out smart metering across the NEM are:
7In the NEM SMI Operating Model, the needs of SA and other jurisdictions without a distributor led
mandate the rollout of smart meters by retailers will need to be addressed.
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There will still be a requirement to settle the wholesale market on the basis of net
system load profiles, rather than actual information; and
Retailers operating across jurisdictions may require different business processes for
managing customer switching and services provided through smart metering, such
as special reads. This is likely to increase the costs associated with managing a
smart metering roll-out.
However, the cost-benefit analysis found that the economies of scale of smart meter
deployment mean that the cost of meters for those jurisdictions rolling out meters would not
be adversely impacted if some jurisdictions chose not to roll out.”8
7 Pilots and Trials Work Stream
The objectives of the Pilots and Trials Work Stream are to:
a) assess the pilots and trials work already undertaken and identify:
key findings that should be taken into account in the development of the SMI
Functional Specification and SMI NEM Operating Model (and proposed changes to
NEM Procedures)
gaps which may need to be addressed in future pilots or trials
b) coordinate pilots and trials, share results, optimise learning and assess if all aspects of
Smart Meters and associated systems, and their impact on network and market operation
and customer responses are tested
As noted in the RIS, it is important for the NSSC to co-ordinate pilots of business cases across
businesses and jurisdictions. It is expected that the pilots will “reduce the range of uncertainty
(particularly in jurisdictions with some risk of a net loss at the lower end of the range of benefits)
to inform whether a roll-out should proceed and also inform the development of roll-out
implementation plans to maximise benefits.”9
In this context, the definitions of ‘pilot’ and ‘trial’ are as follows:
a) A ‘pilot’ means the testing of the integrated smart meter infrastructure on an end to end
basis across nominated classes of consumers on a temporary basis. The length of a pilot
would be agreed on a case by case basis depending on the scope of the pilot.
b) A ‘trial’ means the testing of one or more components of the smart meter infrastructure
to gauge its performance under specified conditions. A trial would specify which
components of the infrastructure were to be tested and the reasons for the test. The
length of a trial would be agreed on a case by case basis.
The deliverables for the pilots and trials work stream should be as follows:
a) For completed, current, and future pilots and trials, the NSSC will prepare status reports
that include a list of matters that would (directly or potentially) adversely affect the
national minimum smart meter functionality or the smart meter infrastructure business
requirements and the business cases. The proposed reporting schedule is as follows:
The first Existing Pilots/Trials Status report will be prepared for the period ending
December 2008 and will cover past and current trials.
8Op. cit. RIS, page 99.
9Op. cit. RIS, page 108.
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The matters arising from the Pilot/Trials 2008 Status Report will be provided to
the Business Requirements Work Stream to assist them in the development of
the SMI Functional Specification.
The second Pilots/Trials Status report will cover the period January to June 2009.
Thereafter MCE is to be provided with a Pilots/Trials Progress Report on June
2010, June 2011, and June 2012.
b) Pilots/Trials Scenarios Working Paper (prepared in 2009)
For new pilots, the NSSC will publish a list of preferred configurations of
technology across all elements of the smart meter infrastructure that would be
desirable to be included in a pilot
i. For example, in a pilot test the NSSC may prefer that the smart meter
infrastructure be configured against nominated functions of the smart
meter (disconnect and reconnect, say), nominated consumer devices (air-
conditioner, say), a particular type of communication technology, and
tested against specified classes of consumers (multiple story residence,
say).
For new trials, the NSSC will publish a list of preferred technical matters that
would be desirable to test in a trial.
i. For example, the testing of a smart meter with distributor line carrier could
be the subject of a suitably constructed trial.
ii. Some examples of other matters that may be tested are:
1. Identify how to improve participation rates in the Direct Load
Control program (using the Smart Meter functionality) and to
encourage the use of IHDs to lower household energy
consumption10
2. “Performance of technologies, interoperability of technologies,
direct load control through smart meters, consumer response and
impacts on different classes of consumers, and business
operational benefits”11
3. Item (o)- advise the MCE on whether direct load control should be
further tested and explored through the Smart Meter pilots to
identify mechanisms to maximise the benefits and to consider the
level of network demand management that can be achieved.
(NSSC terms of reference)
8 Regulation Work Stream
As a result of the business, performance and service level requirements specified for the smart
metering infrastructure and the business processes and procedures specified in the NEM SMI
Operating Model, changes will need to be made to the National Electricity Rules (NER) and
enforceable regulations in the non-NEM jurisdictions to support the rollout of smart meters.
10Op. cit. RIS, page 36.
11Op. cit. RIS, page 116.
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It is also noted that specifications of changes to jurisdictional instruments are outside the scope
of the NSSC deliverables as noted below. However, the NSSC is encouraged to identify where
jurisdictional instruments may need changes.
The NSSC deliverables from this work stream are as follows:
a) SMI Regulatory Architecture paper – this deliverable will provide advice to the MCE on
the architecture of the national regulatory framework for the NSMP. This advice will
recommend to SCO on the regulatory matters to be addressed in the NER (e.g.
roles/responsibilities) versus the NEM Procedures (e.g. meter performance standards)
b) SMI NER Chapter 7 Review paper – this deliverable will provide advice to MCE on a
recommended set of rule or regulation changes with the NEM Objective that need to be
incorporated in regulatory instruments as a result of the smart metering infrastructure
business, performance and service level requirements. Some key regulatory issues to be
addressed may include:
Need for changes to the NER to support SMI (e.g. metrology role/responsibilities,
meter type, etc.)
Advice on consumer protection arrangements for the remote connect/disconnect
and supply capacity control functions when requested by SCO as part of the
MCE’s National Energy Customer Framework review. (Note: This would only
relate to changes to the NER and not NEM Procedures which will be addressed
by the Business Processes and Procedures Work Stream.)
Advice on safety regulations that might impact on the availability of the remote
connect/disconnect and supply capacity control functions when requested by
SCO as part of the MCE’s Safety review. (Note: This would only relate to changes
to the safety regulations and not NEM Procedures which will be addressed by the
Business Processes and Procedures Work Stream.)
Advice on access to and protection of Smart Meter data, in conjunction with the
MCE’s Consumer Protection and Safety Review. (Note: This would only relate to
changes to the NER and not NEM Procedures which will be addressed by the
Business Processes and Procedures Work Stream.)
Advice on any regulatory barriers to the use of direct load control by distribution
network businesses12
“SCO acknowledges that the bundling of meter charges and network charges
may present a barrier to retailers installing smart meters because they are
effectively paying for two meters (the distributors Type 6 meter and the smart
meter). Unbundling currently occurs in Victoria, ACT and Tasmania. SCO may
consider this matter further after seeking advice from the National Stakeholder
Steering Committee (NSSC).”13
“SCO recommends that current metering arrangements in the NEM for customers
with special requirements (e.g. unique PV installations) and the large industry
sector remain contestable. This allows meter providers currently operating in this
market to continue providing this service and build upon their existing expertise.
This approach encourages further innovation and technology development in this
12Op. cit. RIS, page 36.
13Op. cit. RIS, page 31.
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sector which could be transferable to the residential and small customer sector if
it becomes contestable following the roll-out period.
This approach also provides for needs of customers with 'special metering
requirements' by offering them choice of provider. A definition of 'special metering
requirements' should be included in the Rules to provide clear delineation where
metering is the exclusive responsibility of distributors or is contestable.”14
c) SMI Cost Recovery Paper – in response to the proposed SCO approach to SMI Cost
recovery, a SMI Cost Recovery Paper will be prepared that provides a response to SCO
on the principles for cost recovery in relation to:
Pilots and trials
Cost recovery for the implementation of the Smart Metering Infrastructure
9 Recommendation
It is recommended that the NSSC adopt the specification of deliverables, as detailed in
Sections 5 to 8 of this paper, as a contribution to the NSMP Work Plan that is to be
presented for approval to the MCE in December 2008. In summary the work streams and
major deliverables are:
d) Business Requirements Work Stream – Smart Metering Infrastructure Functional
Specification (e.g. defines business requirements, performance requirements and service
standards for the SMI)
e) Business Processes and Procedures Work Stream – NEM Smart Metering Infrastructure
Operating Model (e.g. identifies the procedures that require change to support SMI) with
modified processes/procedures for WA and NT. This work stream will also prepare, ,in
consultation with the relevant NEM reference groups, the recommended changes to
NEM Procedures for consideration by NEMMCO and enforceable procedures in the non-
NEM jurisdictions for consideration by the appropriate regulatory agency.
f) Regulation Work Stream - Regulatory requirements to modify existing regulatory
arrangements including changes to the National Electricity Rules (NER) and enforceable
regulations in the non-NEM jurisdictions to support the rollout of smart meters.
g) Pilots and Trials Work Stream - Pilots and Trials Work Stream – Co-ordinate pilots and
trials of business cases across businesses and jurisdictions. It is expected that the pilots
will reduce the range of uncertainty (particularly in jurisdictions with some risk of a net
loss at the lower end of the range of benefits) to inform whether a roll-out should proceed
and also inform the development of roll-out implementation plans to maximise benefits.
14Op. cit. RIS, pages 90-91.
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Appendix A Glossary
The following acronyms are in the NSSC Glossary.
AEMC Australian Energy Market Commission
AER Australian Energy Regulator
AMI Advanced Metering Infrastructure
AS Australian Standard
B2B Business to Business
BPRG B2B Procedures Reference Group (as established under the IEC)
BRDRG AMI Business Requirements Definition Reference Group
CATS Consumer Administration and Transfer Solution
COAG Council of Australian Governments
DNSP Distribution Network Service Provider
EEEC Equipment Energy Efficiency (E3) Committee
ENA Energy Networks Association
ERAA Energy Retailers Association of Australia
FRC Full Retail Competition
FRMP Financially Responsible Market Participant
HAN Home Area Network
IEC Information Exchange Committee (as established under section 7.2A.2 of the Rules)
IHD In-home Display
LNSP Local Network Service Provider
MCE Ministerial Council on Energy (established under the COAG)
MRG Metrology Reference Group (established under the RMEC)
MSATS Market Settlement and Transfer Solution
MTWG Metering Technology Working Group
NCRE National Consumer Roundtable on Energy
NEL National Electricity Law
NEM National Electricity Market which excludes Western Australia and Northern Territory
NEMMCO National Electricity Market Management Company
NEO National Electricity Objective (as set out in section 7 of the NEL)
NER National Electricity Rules
NSMP National Smart Metering Program
NSSC National Stakeholder Steering Committee (RET Smart Metering program)
NT Northern Territory
RET Commonwealth Department of Resources, Energy and Tourism
RMEC Retail Market Executive Committee
RP Responsible Person
RPWG Retail Policy Working Group (as established under the MCE)
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SCO Standing Council of Officials (as established under the MCE)
SMCN Smart Metering Communication Network
SMMS Smart Metering Management System
SMWG Smart Metering Working Group (as established under SCO)
SWIS South Western Interconnected System in Western Australia
TRWG Technical and Regulatory Working Group
WEM Wholesale Electricity Market (Western Australia)
WAIMO Western Australian Independent Market Operator
WIGS Wholesale Inter-connector Generator and Sample
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Appendix B MCE Outputs and Related Workstreams
On 13 December 2007, the Ministerial Council on Energy (MCE) agreed the following:
MCE Outputs Related Work Streams
(a) develop and recommend technical specifications, performancerequirements and amendments to functions, based on a sound benefitscase.
All excluding Regulation
(b) develop and recommend service standards, including analysis ofcost implications;
All excluding Regulation
(c) propose supporting National Electricity Rule changes and relevantchanges to Western Australia and Northern Territory instruments; and
Regulation
(d) develop appropriate supporting technical documentation throughstandards and/or NEM Procedures.
Business Processesand Procedures
(e) consider any related decisions arising from Phase 2 of the Cost-Benefit Analysis.
All excluding Regulation
On 13 June 2008, the MCE provided further clarification and requested advice from theNSSC along the following lines:
MCE Outputs Related Work Streams
(f) agree with the SCO by the end of July 2008 detailed workingarrangements, which will include the broader scope of work in theMCE’s decision
Complete
(g) advise the MCE by the end of 2008 the specific HAN standard to beadopted
Business Requirements
Defer to 2009
(h) provide advice to the MCE on the architecture of the nationallegislative and regulatory framework for Smart Metering within the NEMto enable the MCE to finalise by the end of 2008 a timeline forfinalisation of these arrangements
Regulation
NSMP Work Plan
(i) develop the technical and operational aspects of the nationalregulatory framework for Smart Metering in the NEM for agreement withthe SCO – the detailed timeline for completion of this framework will beagreed between the NSSC and the MCE by the end of 2008
All excluding Regulation
NSMP Work Plan
(j) advise the MCE on issues related to the National Energy CustomerFramework when the MCE consults the NSSC
All
(k) review access to and protection of Smart Meter data, in conjunctionwith the MCE’s Consumer Protection and Safety Review
All
(l) coordinate pilots and conduct business case studies to share results,optimise learning and ensure all aspects of Smart Meters andassociated systems, and their impact on network and market operationand customer responses are tested
Pilots and Trials
(m) provide timely advice on detailed national minimum functionality forSmart Meters to maximise benefits across all stakeholders - thisincludes functions referred by the MCE to a technical stakeholdergroup, to develop and advise on technical definitions, performance andservice level requirements and relevant Rules
Business Requirements
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MCE Outputs Related Work Streams
(n) recommend to the MCE how direct load control capability can beintegrated into priority appliances - this analysis should be undertakenin conjunction with the existing appliance energy standards workcurrently being conducted by both the Equipment Energy Efficiency(E3) Committee of the National Framework for Energy Efficiency, andStandards Australia
Business Requirements
(o) advise the MCE on whether direct load control should be furthertested and explored through the Smart Meter pilots to identifymechanisms to maximise the benefits and to consider the level ofnetwork demand management that can be achieved
Pilots and Trials
(p) advise the MCE on whether there is a need to provide guidelines tosupport development of the in-home display market
Business Requirements
(q) propose to the MCE defined service standards for access to theHAN to optimise innovation and uptake of in-home services
Business Requirements
(r) advise the MCE on the whether insufficient interoperability betweendifferent meters, communications infrastructures and meteringmanagement systems may introduce further market power risks orreduce competition in metering - in particular:
(i) the materiality of this risk
(ii)international progress on communications standards and practices tosupport interoperability
(iii)the most appropriate framework to manage this risk in the Australianmarket
Business Requirements
(s) consider the separate existing arrangements in the WesternAustralian energy market and the Northern Territory system and theneed for separate regulation and potential variations specific to thosesystems to maximise consistency where beneficial.
All