Recently, in Smart Grid News, Jesse Berst queried: “Why are American utilities spending twice what the Europeans do for smart meters? Why aren’t they using joint standards and joint procurement to achieve economies of scale and drive down prices?
“This screw-up will squander at least $2 trillion over five years. Who will foot the bill? As the old joke goes, one of three groups — rate-payers, consumers, or taxpayers.
$2 billion may be understating things – An American friend working in Europe tells me the typical cost there is $40 per meter (plus $15 for the communications by the way). In america he says typical prices are $110 to $120 per meter (and about $50 for the communications).
To make the mat easier, let’s say American utilities will install 50 million smart meters over five years. And let’s say they will spend $40 more than the Europeans (My Friend says it’s more ike $70 to $80 more). On my calculator, that comes out to $2 billion.
Municipal and co-op organizations such APPA and NRECA often do joint research and sometimes joint buying. Federal Agencies such as BPA and TVA have run a few buying programs over the years. But for the most part, American utilities can’t be bothered to cooperate and collaborate, even with $2 billion at stake….”
Power Grid Networks creates a ‘framework’ agreement for all its grid components — including smart meters. The more units it purchases from its suppliers, the lower the unit cost. Of course, the utility entering into a service agreement with the PGN gets the benefits as well, through lower usage fees over its 5 year billing period, based on a fraction of the Capital Expenditures.