At present, extensive investments in new modern electricity meters (AMR systems) are taking place in Sweden. The main reason for these investments is the new requirements on monthly meter readings, but these systems can generally do a lot more. Other Market Design projects have identified the need for more demand response in the electricity market and the important role of hourly settlement instead of profiling. With present rules and regulation there is an obvious risk that the new AMR technology will not be used to its full socioeconomical potential.
A survey made for this study determined that 90 % of the meters in which grid companies are currently investing make it possible to both register and store hourly meter values. A considerably lower share of the new systems will fully meet the demands of hourly settlement.
Hourly settlement is both individually and collectively an advantage for the customer. Better tariffs and means of control should lead to a more cost-effective power system and in the long term also result in lower electricity prices and higher security of supply. Customers can be remunerated when decreasing electricity consumption when electricity price is high. Better statistics and follow-up will also lead to lower electricity consumption. Consequently, customers can make great use of hourly meter readings and management at hour-based level. At the same time, care must be taken how these possibilities are presented for the customers. They must be given information which is brought into line with each costumer’s individual needs as far as possible.
For electricity suppliers, hourly settlement would mean possibilities to offer new attractive tariffs to customers. It would give customers opportunities to reduce their electricity consumption and at the same time reduce risk exposure for the electricity supplier. With the supplier and the customer having more knowledge about the customer's electricity consumption, the supplier will be able to
develop new services such as helping the costumer to analyze and influence his electricity consumption.
Through clever grid tariffs, grid capacity can be used more efficiently. Also, management and surveillance can be offered to customers in order to optimize their electricity consumption both against the grid tariff and retail price. It also opens up for earning money through new kinds of services offered by the grid companies. It is then very important, however, that these services are developed in such a way so that the competition between power suppliers is not affected.
To make grid companies voluntarily switch to hourly settlement for all its customers, changes in today’s regulations are needed. This study identifies several of these requirements.