Smart meter pricing: Can a Silicon Valley company drop prices by a factor of five?

[Jesse Berst]

Metering International Editor Jonathan Spencer Jones recently interviewed John Heibel, Chairman and CEO of Glen Canyon Corp., the Santa Cruz company that promises a smart meter for as little as $20. In our piece on price wars coming to smart meters earlier this year we introduced you to Glen Canyon.

Jonathan's interview reveals some of the secrets behind the low, low price. For one thing, the unit starts with communications at the core, then adds metrology. For another, it has a much smaller form factor. For another, it was conceived as a loss-leader for the company's cloud-based meter data management service. And for another, the firm has a Chinese partner that helps with the manufacturing and another one that has already secured orders in China. Heibel claims to have an order backlog of more than four million meters already.

For years, we've been expecting smart meter hardware prices to decline sharply. Will the prediction finally come true in 2012? Will they drop – and how much will they drop? Or will they stay steady? I'll be curious to hear your thoughts.

[Jeff Williams]

I would expect the prices to drop and possibly in the range predicted. This will be driven by China's manufacturing ability coupled with loss of federal grant subsidies capping utility participation, and the focus on communication vs meter function. The price competition will move China in the lead over Mexico, India, etc. as meter manufacturers. The list of meter manufactruing facilities follows.
The value of communications and metering for smart meters is secondary to the main purpose of remote shutoff for utility applications perspective. Meters with this capability will have value.

Company Electric Meter Manufacturing Facilities U.S. Manufacturing Facilities

Itron Campinas, Brazil
Atlantis, South Africa Waseca, Wi
Echelon China
Elster Belgium Raleigh, N.C.
General Electric
Landis + Gyr Reynosa, Mexico
Sensus Juarez, Mexico
Manufacturing/Assembly
DuBois, Pennsylvania
Manufacturing/Assembly
Texarkana, Arkansas
Manufacturing/Assembly

[Bruce Hamilton]

$20 meters are possible by taking the standard approach to low cost electronics.
Uility meter specifications are the mail force determining the cost. For example, an ANSI 200A, 2000:1 dynamic range 0.15% (rated 0.2%) accuracy meter with 2KHz+ power bandwidth, antitampering capabilities, cutoff relay, proprietary AMI communication and ZibBee wireless communication, ability to withstand high voltage and high current impulses, and proven 20Yr lifetime, and the ability to measure and communicate power quality information cannot be done for $20.
An IEC meter (no expensive ANSI base), with 60A maximum, 1000:1 dynamic range, 1% accuracy, <400Hz bandwidth, no antitampering, no cutoff relay, no AMI, no ability to withstand high voltage and high current impulses and no lifetime spec or guarantee can be done for $20.
Like everything we get what we pay for.
The $20 meter is largely useless for smart grid applications. As previously mentioned, the cost of a meter is not the majority of the cost of a smart grid AMI deployment. That is why most meter companies have the more profitable AMI communications product lines. They esentially sell the meters at cost to get the AMI communications business.
Focusing on meter cost as a way to reduce AMI deployment costs or even trying to minimize AMI deployment costs is not what we want our utilities to be doing. We want them to have a long term goal that will provide the required power reliability and quality while providing the capability to monitor and control our power usage. Then the utility should be specifying the most economical way to meet that goal.

Bruce Hamilton
Pulse Electronics

[Tharanath Naik]

Usually price drops a bit as the volume goes up, but 20$ Smart meter really interesting and equally curious to know what it gives and what not.