Implementation Challenges: State utilities share their smart meter experiences

State utilities share their smart meter experiences

The roll-out of smart meters across the country has been one of the most significant technological upgrade exercises in the energy sector. A smart metering system not only reduces commercial losses by improving the billing and collection efficiency, but also helps in managing peak load, while enhancing customer experience. Smart metering has received a major push from the government through several policy initiatives such as the Integrated Power Development Scheme (IPDS), Ujwal Discom Assurance Yojana (UDAY), Smart Meter National Programme (SMNP), and various smart grid pilot projects. The National Tariff Policy, 2016 also lays special emphasis on the role of smart metering in the reduction of aggregate technical and commercial (AT&C) losses. Recently, the Ministry of Power (MoP) announced a target to convert all meters into smart prepaid meters over a period of three years starting April 1, 2019.

Discoms have also undertaken various small-scale projects towards the implementation of smart meters. At a recent Power Line conference, a panel comprising officials from three discoms – Bangalore Electricity Supply Company (BESCOM), Southern Power Distribution Company of Andhra Pradesh (APSPDCL), and Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited (MPPaKVVL) – shared their experiences and the key issues in smart metering. Excerpts from the discussion…

The smart metering experience

As per MoP directives and regulatory requirements, the utilities have been undertaking the implementation of smart meters. BESCOM is deploying prepaid meters for temporary installations based on two technologies – card and keypad. In the Tumakuru smart city, about 17,000 smart meters, enabled with a number of features of advanced metering technologies, are being deployed. The cost of these meters is estimated to be Rs 9,000-Rs 10,000 per node with the total budget for this implementation being around Rs 175 million. The smart metering system bidders have to provide comprehensive solutions for not just the installation of meters, but also for meter reading and integration with the billing software. BESCOM is contemplating to expand the implementation of smart meters based on the experience of the Tumakuru project. It is also focusing on capacity building in the area of smart metering technologies. BESCOM has installed over 12,000 smart meters under the IPDS (as of March 2019) and is in the process of deploying more under the Deen Dayal Upadhyaya Gram Jyoti Yojana. The discom has a consumer base of around 9 million with about 500,000 consumers being added every year. Considering the huge consumer turnout, the utility has launched the “retail outlets for meters” concept. As part of this, consumers can directly purchase meters from such retail outlets, which are operated by manufacturers selected through a bidding process. The manufacturers are required to provide a five-year guarantee covering the replacement of meters in case of failure. This has reduced the need for the discom to maintain unnecessary stores.

Meanwhile, APSPDCL is implementing a smart meter pilot project with Energy Efficiency Services Limited (EESL) under which 125,000 meters will be installed. About 25,000 of these meters will be installed using the capex model of EESL and the remaining based on a combination of capex and opex models. In another pilot project, the utility is implementing a combination of radio frequency (RF) technology with a gateway of GPRS technology at a distance of every 200 metres. However, in areas where the density of consumers to be covered under the smart metering programme is high, such as industrial estates, only RF technology is planned to be used. APSPDCL is inviting entities to implement smart meter pilot projects. Further, it is deploying 40,000 smart meters under the Tirupati smart city project.

For MPPaKVVL, it has been a long journey from automatic meter reading (AMR) to smart meters. AMR-based meters were implemented under the restructured accelerated power development and reforms programme (R-APDRP), followed by meter data acquisition and management systems, and supervisory control and data acquisition (SCADA) systems (in two cities) before the utility took up the implementation of smart meters. The discom has installed 75,000 smart meters. It has extended the project to install 120,000 smart meters in total. The project is being implemented by L&T, which is responsible not only for the supply and installation of meters but also for their maintenance for five years. It is being implemented using a mix of RF and GPRS technologies. The meters have RF modules through which data is transmitted to data concentrators enabled with GPRS technology. The cost of installing 120,000 smart meters is estimated to be around Rs 960 million, which the utility expects to recover over a period of two years based on the improvement in billing efficiency (which is currently at 60 per cent). This infrastructure can be used to install another 180,000 meters without any additional cost.

Benefits and challenges

Smart meters are expected to significantly improve accuracy of energy billing by reducing manual intervention. With smart meters, the meter readings are directly fed into the billing system, thereby eliminating any manual intervention and errors in energy billing. With the improvement in accuracy of meter reading along with a reduction in billing cycles, the utilities have been able to reduce their commercial losses significantly. BESCOM has achieved 100 per cent billing and collection efficiency, reduced transmission and distribution (T&D) losses by around 12 per cent and AT&C by 14 per cent. APSPDCL is amongst the best performing utilities in terms of reducing loss levels, with AT&C losses coming down to 8-10 per cent.

Smart meters provide data on the power factor, which incentivises consumers to manage their power consumption. Further, smart meters enable consumers to record their daily power consumption data, thereby allowing them to check their power requirement and control their energy bills. MPPaKVVL uses an online app to communicate the power data to consumers, enabling them to monitor and manage their power consumption while supporting overall energy conservation.

One of the key impediments to the implementation of smart metering technologies is the resistance from consumers. When no direct benefits are visible to consumers, they resist the replacement of meters. Another major challenge pertains to the dependency of the utilities on service providers for the communication technology to be used. In the absence of in-house capacity, the utilities are completely dependent on service providers for the creation of the network as in the case of RF technology. This dependence is less in the case of GPRS technology where the data is directly communicated from the meter to the head-end system. There are very few manufacturers that provide complete end-to-end metering solutions. Thus, utilities have been allowing subcontracting to the main solution provider as in the case of BESCOM’s Tumakuru smart city project.

Another bottleneck being faced by the utilities relates to the integration of new meters with the existing billing system. In the case of BESCOM, the prepaid meters being installed are stand-alone systems; this results in difficulties in obtaining readings from a remote location. Hence, meter readings are being taken manually. The integration of meter data with the billing software has also not been done yet since the billing software is not designed for prepaid systems.


The implementation of smart meters has so far  been confined to pilot projects being undertaken by the government and discoms. Due to the operational challenges discussed above, the progress in implementation has been slow. Besides, the high costs involved and the lack of clarity on the mechanism of recovery of such costs have affected the pace of roll-out of smart meters. In addition, market readiness and discoms’ technical capacity need to be enhanced for a faster and smoother implementation.