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Measuring Up

15 July 2007

The Energy White Paper has brought the humble meter well and truly into the 21st century. Alan Aldridge argues that it recognises the key part that metering plays in encouraging consumers, both large and small, to control their energy consumption.

OUT OF SIGHT AND OUT OF MIND – that is the traditional location of the utility meter, whether in a small inaccessible cupboard or, in the case of water meters, buried underground below a non-descript inspection cover. Yet without accurate data from the meter, it is impossible to maintain tight control over energy or water consumption, and that ultimately means no realistic control over utility bills either.

However, it would be wrong to lay the blame for this situation at the doorstep of uninterested consumers. Corporate and public sector organisations have been aware of the potential for savings in this area for some time. The problem has to a large extent been institutional. Until privatisation, energy bills were accepted as inevitable and largely uncontrollable - except perhaps for large, energy-intensive groups where energy was a key and expensive ingredient in the production process. After privatisation the new energy distribution companies retained ownership of the metering and, importantly, of the data. Although inroads have been made into those de-facto monopolies, the situation has remained relatively unchanged since then. The result is that many consumers are still receiving estimated bills to this day (and to many, these seem more like guesstimates!). Is this acceptable at the beginning of the 21st century? Of course not – and it does not need to be this way.

The energy efficiency industry – including ESTA and its Metering and Monitoring Group – has been working with the Government, the regulator and more recently the energy industry itself, to make it easier for people to access the benefits of the latest metering technologies. The recent White Paper is a reflection of the efforts that many have been making to introduce state of the art – but proven – technology into an area where the electro-mechanical meters of the early 20th century are still often encountered. The White Paper promises that the use of ‘smart’ metering is to be given a substantial boost, and extended to individual homeowners who will be entitled to a free display unit giving up to date information on the way they are using energy.

For non-domestic users, there will be steps taken to give much wider access to smart metering, and there will be incentives to encourage users to make the most of the opportunities that these systems offer. The Government is to consult later this year on the proposal that “energy suppliers should extend to all but the smallest business users in Great Britain and those larger businesses not subject that can read consumption, input this into analysis packages and present the results in formats that are understandable by nonspecialists as well as trained energy managers. These systems will also activate alarms for out-of-range values, alerting managers to equipment breakdown and set-point drift. Known collectively as automatic Monitoring & Targeting (aM&T) systems, these include the meters themselves, automatic meter reading and data collection, waste analysis and alarms which alert users to excessive consumption.

Over recent years, private and public sector organisations have been reporting significant savings from the introduction of these systems. And work carried out by ESTA has enabled estimations to be made on the cost-effectiveness of installations. At the same time, the importance of accurate information is increasingly being recognised by Government and regulators. The latest revision of the Building Regulations says that energy meters should be installed that track consumption of the main energy sources: “Reasonable provision for energy meters would be to install energy metering systems that enable at least 90 per cent of the estimated annual energy consumption of each fuel to be assigned to the various end-use categories (heating, lighting, etc).” Detailed guidance has been prepared by the CIBSE Technical Manual TM39.

The Regulations also state that: “(a) the performance of any [low or zero carbon] system [is] to be separately monitored; and (b) in buildings with a total useful floor area greater than 1000m2, [there should be] automatic meter reading and data collection facilities”.

If in larger buildings automatic meter reading (AMR) is required, the additional incremental cost of upgrading to full aM&T will in most cases be cost-effective. The Government already offers an incentive for building owners and operators to install aM&T – the Building Regulations offer a 5 per cent allowance on carbon emission limits if this technology is installed. ESTA calculates that the real impact of aM&T systems can be in the order of 20 per cent of fuel bills in certain cases!

Because these systems are regarded as a combination of several distinct items, they do not occur as such on the Approved Energy Technology List. Instead, energy users should contact the manufacturers of the chosen equipment to check on their eligibility for ECAs.

The revisions to the Building Regulations implemented the early articles of the Energy Performance of Buildings Directive (EPBD) which was due to be introduced throughout the EU by the beginning of 2006. Now, legislation is being introduced which will bring in the remaining articles. Specifically, these relate to Energy Performance Certificates (and Display Energy Certificates (DEC) for large, publicly-funded buildings) and regular inspections of airconditioning systems. The most striking feature of the new certificates will be the use of an A-G graphical banding of energy performance similar to those already familiar on domestic white goods such as fridge/freezers and washing machines as well as new cars (see left).

Energy Performance Certificates are required whenever a building is constructed, sold or let and the rating (known as an ‘asset rating’) gives a measure of the efficiency ‘as built’, i.e. it takes account of the construction materials and methods and the building services and systems. Display Energy Certificates also require an ‘operational rating’ which measures how well the building is actually operated. Although only required for publicly-funded buildings at present (which includes PFI contracts) the Government has promised to consult later this year about extending DECs to the private sector.

ESTA believes that the advent of energy ratings – and particularly the operational rating – will provide an opportunity to engage senior management in issues about energy efficiency. The A-G graphical representation of efficiency is intuitively easier to understand than annualised kilowatt-hours per useful square metre of floor space.

So these certificates will enable energy and facilities managers to demonstrate the relative efficiencies (and running costs) of the different sites within the building portfolio, cost the improvements needed to move up a band and prioritise projects across the estate. This information can then be presented to senior management as the basis for a one, three or fiveyear programme of improvement. The fact that energy efficiency now becomes a factor in any purchase or tenancy negotiation will increase the asset value of energy efficient properties (and depress those of inefficient buildings). That will be of interest to the finance director!

In addition to making smart metering much more widespread, the White Paper also proposed a Carbon Reduction Commitment (CRC). Large commercial and public sector organisations (including banks, retailers and local authorities) will find themselves included within a mandatory cap-and-trade system for carbon allowances. Those covered will be consumers of more than 6,000MWh of electricity per year – that equates roughly to an electricity bill of more than £500,000. This is about twice the consumption originally proposed, but as it will cover all organisations of this size (and not just those who choose to take part) that is probably a manageable number for the launch of the scheme. There will be exemptions for those companies with over 25 per cent of their energy use in Climate Change Agreements.

Unlike the EU Emissions Trading Scheme, all the allowances will be auctioned. However, the Government says the scheme will be revenue neutral with monies collected being recycled via a direct annual payment proportional to average annual emissions. Here the ability to optimise energy consumption through effective control and management will benefit organisations, both in reducing liabilities under the CRC and providing excess allowances to sell to other scheme participants. Metering is the basis for all this -without it, effective management of energy is just not possible.

More info
Energy White Paper ewp_full.pdf

● Alan Aldridge is the Executive Director of ESTA.

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