Driving Uptake

Central and state initiatives in smart metering

Over the past couple of years, there has been an increasing focus on the implementation of smart meters in the country. It is a key component of various central government schemes and programmes such as the Ujwal Discom Assurance Yojana (UDAY), the Integrated Power Development Scheme (IPDS), and smart grid pilots. Energy Efficiency Services Limited (EESL) is implementing the Smart Meter National Programme for replacing 250 million conventional meters. Besides this, various states have issued mega tenders for the procurement and installation of smart meters. Notably, bulk tendering with demand aggregation has brought down meter prices. The Central Electricity Regulatory Commission (CERC) and the Central Electricity Authority (CEA) have also notified regulations and standards to be followed by the utilities for setting up a robust communication network. A look at the various central and state initiatives driving smart meter uptake in India…


The National Tariff Policy, amended in January 2016, mandates the deployment of smart meters for all consumers with a consumption of more than 200 units per month. In line with this, smart meters are planned to be installed under UDAY for all consumers with a monthly consumption of more than 500 units by December 31, 2017, and for those with a consumption of 200-500 units per month by December 31, 2019. As of May 2019, about 4 per cent of the targeted 5.7 million smart meters have been installed for consumers with a monthly consumption of over 500 kWh under UDAY. For consumers in the 200-500 kWh category, smart meter deployment is only 2 per cent of the targeted 18.4 million. Only Sikkim and Puducherry have met their respective smart metering targets in both consumer categories, while Himachal Pradesh has met the target for the 200-500 kWh category. The progress rates of other states vary from 0 to 57 per cent.


Launched in 2014, the IPDS envisages the installation of smart meters with supervisory control and data acquisition (SCADA) systems in all urban areas. A project cost of Rs 8.30 billion and a grant of Rs 5 billion have been approved by the government under the scheme. However, disbursements have been nil, as of February 2019. Nearly 4.1 million smart meters are targeted to be installed under the scheme by 21 discoms across 12 states. The states can either procure them on a stand-alone basis or through an aggregator such as EESL and PFC Consulting.

Smart grid pilots

The Ministry of Power (MoP) has sanctioned 12 smart grid pilot projects with 50 per cent funding from the government. All these projects (excluding the Smart Grid Knowledge Centre at Manesar) involve the implementation of advanced metering infrastructure (AMI), along with other functionalities such as outage management system, SCADA and demand response. The pilot projects envisage the implementation of 170,000 smart meters, of which over 132,000 have already been installed. Five smart grid projects under the National Smart Grid Mission (with 30 per cent funding from the MoP), which are currently under way, also entail AMI/smart meter implementation.

Smart Meter National Programme

EESL is implementing the Smart Meter National Programme under which it aims to replace 250 million conventional meters with smarter versions. In this context, EESL has signed agreements with various state discoms to undertake smart metering projects. EESL is implementing its proven model of bulk procurement, demand aggregation and monetisation of savings.

EESL has released two tenders so far. The latest was launched in March 2018 for procuring 5 million smart meters on a pan-Indian basis. It witnessed the participation of 16 manufacturers. The results have not yet been announced.

The other tender was launched in July 2017 for the procurement of 5 million smart meters on behalf of Uttar Pradesh (4 million smart meters) and Haryana (1 million) utilities. The results of the first bidding round were announced in October 2017, in which Larsen & Toubro emerged as the lowest bidder after quoting a price of Rs 2,722 per single-phase smart meter, which was 40-50 per cent lower than the prevailing market rate. In a reverse auction conducted later in October 2017, ITI Limited emerged as the lowest bidder after quoting a price of Rs 2,503 per single-phase smart meter, a decline of 8 per cent over the previous bid price. ITI Limited was announced as the final winner in the first smart meter tender.

Communication technology

With growing digitalisation of the power system, the need for a robust communication backbone for data and voice transfer has assumed greater significance. A communication system is vital for maintaining grid stability and security. It is also a key component of AMI. It enables two way communication between smart meters and the head-end system (HES) to enable remote reading, monitoring and control of meters (consumer, feeder, distribution transformer, etc). In order to maintain a robust communication network, the CEA and the CERC have notified guidelines and specifications that will help power utilities to frame their communication infrastructure plan/strategy for the upcoming IT and OT applications.

In May 2017, the CERC had notified the CERC (Communication System for Inter-state Transmission of Electricity) Regulations, 2017. The regulation provides a framework for the planning, implementation, operations and maintenance, and upgradation of the communication system of the power system. It extends to the communication infrastructure used for data exchange and tele-protection of the power system at the national, regional and inter-state levels. In line with these regulations, in September 2018, the CEA notified the draft Guidelines on Availability of Communication Systems for Interstate Transmission of Electricity. The guidelines focus on the treatment of communication system outages and the methodology for the computation of communication system availability.

In August 2018, the CEA released the revised draft Technical Standards for Communication in Power Sector Regulations, 2018. Broadly, the standards aim to ensure the seamless integration of a reliable, redundant and secure communication network. As per the standards, the data provider or the intervening communication system provider must be informed about the standards and conditions. The standards have been divided into four broad areas – wideband communication, power line communication (PLC), radio GPRS and VSAT. The wideband communication standards relate to the fibre optic and wideband network. As per the standards, the communication system should be planned up to the interface points of the data provider and the respective control centre. The draft states that the AMI system should include reliable communication links to maintain the desired performance level.

The next few years are expected to see a significant policy push towards smart metering. The proposed amendments to the Electricity Act 2003 mandate the use of smart meters. Recently, the MoP announced an ambitious target to convert all meters to smart prepaid meters over three years starting April 2019. To conclude, smart meter deployment in India is slowly gaining ground though a complete shift to smart meters is still awaited.


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