CRC threatens smart meter supply pinch

A clause in the Carbon Reduction Commitment (CRC) regulations that allows firms to climb the league table showing participants' relative emission reduction performance if they install Automatic Meter Reading (AMR) systems could lead to a "supply pinch" for new smart meters.

That is the warning from Bobby Collinson, managing director of green consultancy Power Efficiency, who today warned that those firms banking on rolling out AMRs after the CRC emission trading scheme comes into effect next month may struggle to complete the project during the first year of the scheme.

Speaking to BusinessGreen.com, Collinson said that a recent flood of orders for AMR systems that provide automated half-hourly meter readings for a building suggested that demand for services from AMR installation firms could outstrip supply over the next 12 months.

"The issue is not getting the meters, it is getting them installed," he said. "We've found that the projects tend to take longer than you'd think, particularly when it can require turning off the energy and a lot of firms want the installation to be undertaken outside of work hours. If, as expected, we see a lot more firms going down this route there is likely to be a supply pinch."

Under the rules of the CRC regulations, voluntary installation of AMR meters across an organisation's properties accounts for half of the league table ranking detailing firms' emission reduction performance during the first year of the scheme, with the remaining 50 per cent awarded on the basis of whether or not the firm has been awarded the Carbon Trust standard.

"AMR can drive cost savings and has a fast return on investment, as well as significantly affecting league table position, but March 2011 is closer than companies think, given the task of getting AMR right," said John Field, Power Efficiency’s director of carbon management, said. "It is rarely a smooth process – taking time to assess estates, rationalise requirements for metering, calculate the right investments, and all this is before you actually get to installation and receive meaningful information from the 17,520 readings a year that each meter produces."

Collinson added that a lot of firms could authorise the roll out of AMR meters in an attempt to gain an easy boost to their league table position without realising how extensive a project it is likely to be. "If you are a retailer, your headquarters and flagship stores will already have-half hourly meters in place," he said. "But you could have hundreds of smaller stores around the country without meters and installing them is a big project."

David Symons, director at green consultancy WSP Environmental, confirmed a smart meter supply crunch is on the cards. "DECC late in the day changed the definition of AMR to mean the fiscal meter only, [but] there are few licensed operators who are allowed to change fiscal meters," he said. "We fully expect that there will capacity constraints next year."