Smart grid communications game changer? Consumers Energy selects cellular for 1.8M meter rollout

Deal implications? Click to the next page >> By Jesse Berst   For years, private radio frequency (RF) networks have ruled the North American smart grid communications market. Cracks began to appear in the dike in the summer of 2010 when Texas New Mexico Power announced it would use a public cellular network for its 230,000 meters.

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But now cellular advocates have the big win they have been seeking for so long. Consumers Energy has selected SmartSynch to provide smart meters to its 1.8 million customers in Michigan. (Neither the meter manufacturer nor the cellular carrier had been announced as of this writing.)

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I will give you a few highlights of the deal, before discussing the implications.

All the bidders underwent very thorough due diligence. Consumer Energy's rigorous approach should go a long way to reassure other large utilities that cellular makes the grade.

Security was a huge issue. Consumers' due diligence process selected cellular as the most secure option.

Growth path. Ease of expansion was one of the factors. Although most private networks are just fine for straightforward metering, some of them run out of headroom when the utility wants to layer on distribution automation and grid applications.

"This SmartSynch technology provides the flexibility, security and options that we need,” said Consumers' president and CEO John Russell in a prepared statement.

The price was (finally) right. All the major cellular carriers bid on the project and all of them provided a very attractive price. The carriers have finally gotten pricing in line to be fully competitive.

The commitment was (finally) right. The carriers also stepped up to make long-term commitments to support the 3G technology that will be in the meters. You and I may buy a new cell phone every 18 months. But utilities obviously can't afford to upgrade that often. (SmartSynch will provide a migration path to 4G and 5G as they appear.)

Capital outlay. By going cellular, Consumers Energy did not have to shell out a few hundred million dollars upfront to build a new network across its entire service territory.

Coverage. Cellular communications modules have better antennas and more power than voice handsets. They can often get a signal where a phone would fail. And SmartSynch has guaranteed to fix any coverage gaps.