Smart Grids are here and consumers are at its very heart

Findings of Logica's 2010 Smart Grid Study reveal massive progress in smart grids

• Smart grids have moved from hype to reality and are the enviable future of Australia's energy sector
• The industry recognises that smart grids will not happen without consumer support 
• With huge developments in many areas across the grid, Australia in on par with the US, Asia and Europe
• Key challenges include drivers for business case, lack of regulatory support, information management, immaturity of standards and technologies, and lack of synergy with the NBN

(Sydney, 7 December 2010): Logica Australia, a leading IT and business services provider, today announced the findings of its second industry study for Smart Grids. The study revealed major progress has been made by Australia’s energy sector since 2009 and highlighted an industry shift that puts consumers at the heart of smart grid and new technology programs for the first time.

“Since last year, smart grids have evolved from ‘hype’ to reality,” said Paul King, Logica’s Smart Grid Industry Consultant. “Last year’s survey showed there was a general lack of clarity around how smart grids would play out in Australia. Energy companies were still in the early stages of developing smart grids strategies and keeping a close eye on international projects. Now, all companies interviewed are rolling out their strategies and completing pilots.”

The study was compiled by Logica following a series of one-to-one interviews with senior executives from 13 energy companies, including CIOs, CEOs and General Managers from 11 of Australia’s 13 distribution companies. Participants were asked a series of questions related to their smart grid activity, as well as their views on the key challenges faced and calls for action in 2011.

“The biggest finding of this year’s report is that the industry has clearly learnt from Victoria’s experience with their smart meter roll out. Last year consumer engagement activity was embryonic at best, but now energy companies understand that smart grids will not happen without getting their customers on side. Customer expectations and knowledge around energy management are changing quickly and the industry needs to keep up with them,” said King.

“All companies interviewed are now heavily focused on consumer engagement activities, such as active participation in trials, door to door visits and focus groups, to better understand consumer demand and educate customers on the role smart grids will play in creating a greener future for Australia,” said King.   

“Australia has really picked up its game this year and is now on par with the rest of the world. In some cases, such as Victoria’s mandatory smart meter program, Australia is actually now considered a world leader. This is despite having relatively low government investment in comparison to other countries, such as the USA,” said King.

 Respondents named the Federal Governments $100 Million ‘Smart Grid, Smart Cities’ project, led by Energy Australia, as a major driver for progress in 2010 as it acted as a catalyst for their own delivery of smart grids.

The report suggests that Australia’s energy sector will continue to accelerate this modernisation over the coming years as new devices, technologies and ideas are entering the market on almost a weekly basis.

 “Technology was both one of the biggest drivers and challenges for the industry. Smart grids will generate about seven thousand times more data for energy companies. There is still a great deal of concern about how this will be managed and stored, as well as the security and privacy issues associated with owning this information,” said King. 

The 2010 report also highlighted the immaturity of technologies and lack of standards as major challenges for smart grids, as well as the lack of synergy with the NBN roll out as smart grids rely on access to high speed broadband.

“Many of the technologies emerging in the market are still unproven or in early stages of trials. There is a concern that some of these, such as electric cars, could throw up new challenges and, in many cases, are taking too long to come to market. There are also few standards for technologies and an unclear roadmap for putting these in place,” added King. 

A majority of Australia’s energy leaders still believe that AER (Australian Energy Regulator) is not doing enough to facilitate the move to smart grids or encourage innovation in the sector. While most do not believe that AER’s role is to offer incentives as suggested in the 2009 study, the industry feels that it needs to take a stronger “facilitation and enabling role”.

“Australia is still in the early stages of its evolution towards smart grids, but it is now clearly the future of our energy sector. The industry is on the brink of a major transformation that will take place over the next 20 years as new technologies and players enter the market. This is by far the hardest thing the sector has ever faced,” said King.

For a copy of the report or an interview with Paul King – Industry Consultant, Smart Grids, Logica, please contact Daya Lichtenstein on (02) 9212 3888.

NOTES TO EDITORS

About Logica:
Logica is a business and technology service company, employing 39,000 people. It provides business consulting, systems integration and outsourcing to clients around the world, including many of Europe's largest businesses. Logica creates value for clients by successfully integrating people, business and technology. It is committed to long term collaboration, applying insight to create innovative answers to clients’ business needs.  Logica is listed on both the London Stock Exchange and Euronext (Amsterdam) (LSE: LOG; Euronext: LOG).More information is available at www.logica.com.

Press contacts
Daya Lichtenstein, (02) 9212 3888 or daya.lichtenstein@logica.com