In the context of the concurrent energy discussion, two terms keep coming up again and again: smart grids and smart meters. What do they refer do – and how do we benefit from them? Even though there is no internationally agreed on definition for smart grids, the term usually refers to intelligent electricity networks that are capable of understanding and integrating the behaviour of all its users, unifying power sources and generators as well as consumers. Their aim is the efficent deliverance of sustainable power from an economic, environmental and security-related angle.

 Smart meters are increasingly playing a major role in the realisation of smart grids – even though, strictly speaking, a smart meter does not necessarily have to refer to an electrical meter. It may just as well be a device for the measuring of gas or water supply / consumption.

Technologically, smart meters are based on a variety of different measuring methods, such as real-time sensors, power quality monitoring and power outage notification. The efficiency reached through this combination makes them a less costly alternative to prior meter generations, in so far as they can be used for all customer classes, may they be residental, commercial or industrial users. 

In the grand scheme of today’s power situation, smart meters provide extremely valuable information for the planning of electricity generation and supply. Two relatively modern concepts have made it difficult for governments to keep track of the overall energy situation: electricity deregulation and market-regulated pricing. Non-smart meters can merely measure the overall consumption of energy. They do not offer any information on when exactly the consumption takes place. With smart metering supplying these data, it is possible to analyse patterns of consumption and individualise energy prices according to the times power is actually consumed. The theory goes that by billing the consumer according to the amount used as well as the time of day it was consumed at, the consumption habits will become more responsive to market prices. It is hoped that this self-regulation system can postpone the necessity for additional generation as well as the purchase of power from costly sources, thus preventing the further increase of electricity prices.