India’s electricity demand has been showing strong growth, reflecting the country’s economic expansion. Between 2005 and 2023, per capita electricity consumption in India doubled from 631 kWh to 1,327 kWh. By generation capacity, India is now the third largest electricity market in the world, with an installed capacity of 426 GW.

For several years, the financial performance of distribution companies (DISCOMs) has been a critical issue for policymakers. High aggregate technical and commercial (AT&C) losses, delayed tariff revisions, increasing debt, long term power purchase agreement lock-ins, theft, grid instability are all factors that have contributed to the financial distress of DISCOMs.

Government of India (GoI) policy reforms aimed at digital transformation of the power infrastructure and enhancing energy efficiency, can reduce both operational and financial losses for DISCOMs. Some of the key reforms aim to increase the adoption of smart meters throughout the country. Smart meters provide real-time data on energy consumption offering benefits such as accurate billing, theft/tamper detection, peak load management, remote monitoring, improved grid management, and enhanced customer service. Mobile operators play a critical role in smart meter adoption by providing NB-IoT connectivity and cellular IoT solutions. Their plug-and-play licensed cellular networks ensure seamless integration and reliable data transmission for smart metering systems.

This blog aims to explore the role of mobile operators in India’s smart utility solutions ecosystem. It first provides context on some of the key power sector reforms that are shaping the market. Then it discusses the role of mobile operators in the value chain, and some of the key challenges and opportunities associated with providing technology solutions to utilities in India.

Recent reforms to India’s power sector

GoI has taken several policy reforms to improve financial and operational efficiencies of the power sector and achieve net zero emissions by 2070.

Key GoI energy sector programmes and reforms:

• Smart Grid:
  • National Smart Grid Mission (NSGM) was established by GoI in 2015 with an aim to improve energy reliability, enable renewable energy inputs through distributed generation, smart metering, and capacity building.
  • The Revamped Distribution Sector Scheme (RDSS) was launched in 2021 for a period of five years. This reforms-based and results-linked scheme aims to improve the quality, reliability, and affordability of power supply to consumers and reduce the AT&C losses. Prepaid smart metering is a critical intervention within RDSS.
• Consumer Empowerment:
  • Electricity (Rights of Consumers) Rules, 2020 and further amendments in 2021, 2022, 2023 and recently in 2024. These rules have several features that benefit consumers. The features include time limits and standards for the various services to be provided by DISCOMs, introduction of Time of Day (ToD) tariffs, and promoting consumption of power from renewable sources.
• Inter State Transmission: One Nation – One Grid – One Frequency
  • Central Transmission Utility of India formed to plan, develop, operationalise, and maintain inter-state transmission system (ISTS). It will also coordinate with regional transmission utilities, state transmission utilities, and other stakeholders to maintain grid stability and facilitate power exchange.

A key element of the RDSS focusses on deploying pre-paid smart metering, and with that the roll out of one of the world’s most ambitious metering programmes; aiming to replace 250 million conventional meters by 2026. The introduction of ToD tariffs for commercial and industrial consumers accompanied by smart meter installation will further reduce losses of DISCOMs by improving efficiency and accurate billing. Together these can facilitate integration of renewables, enable demand responsive pricing, support load balancing and improve grid stability. For consumers, smart meters ensure accurate billing through eliminating estimates and manual readings. Another potential benefit is shifting consumption to ToD pricing to lower bills. Finally, smart meters also enhance service quality by quickly identifying outages.

The role of mobile operators in India’s smart meter roll-out

In the last three years, there have been several partnerships between mobile operators, advanced metering infrastructure service providers (AMISP), and energy utilities in India:

• Airtel partnered with IntelliSmart  (20 million smart meters), Secure Meters (1.3 million smart meters in Bihar), Avon Meters, TP Western Odisha Distribution Limited (200,000 smart meters in Odisha) and more recently Adani Energy Solutions Limited to deploy 20 million smart meters.
• Jio and Tata Power Delhi Distribution launched a smart metering solution for households using the operator’s NB-IoT network. Jio also partnered with Energy Efficiency Services Limited to deploy one million smart meters in Bihar.
• Vodafone-Idea partnered with IoT platform provider Trilliant to deploy more than 1.5 million smart meters for seven utilities in Haryana and Uttar Pradesh.

These partnerships highlight how key power sector reforms and mandates by the GoI have ignited the digital transformation of utilities across India and created significant market opportunities for mobile operators.

As highlighted by some of our past innovation funding in the power sector, mobile operators have been key partners in utility digital transformation throughout the wider region (see below).    

Regional operator engagement with smart grid solutions

Mobile operators are increasingly aiming to position themselves as digital service providers. They play a crucial role in the smart meter deployments as they provide connectivity and platform, essential for operation. New communication technologies such as Narrowband Internet of Things (NB-IoT) and LTE-M offer low-power, wide-area network solutions that are ideal for smart meter applications. Ideally, the selection of technologies should depend on a mix of security, reliability, coverage, commercial viability, and scalability. These technologies provide the connectivity backbone, enabling the secure and reliable transmission of data from meters to utility providers and consumers in real-time.

The most widely used technology is the licensed cellular network (NB-IoT). Cellular IoT remains a convenient choice due to several factors. Firstly, standards-based communication for connecting the meters addresses interoperability challenges between different service providers. Secondly, it also safeguards the deployments from vendor specific proprietary implementations which may prove to be unviable in the long run. Lastly, these networks do not require customers to incur any upfront capex for network roll-out, and eliminates costs associated with deploying, managing and operating these proprietary networks.

Beyond the connectivity layer, mobile operators aim to become strategic partners capable of scaling smart metering solutions and adding value across the value chain associated with the digital transformation of utilities. Figure 1 below provides an architecture for IoT solutions. Mobile operators can provide services across the IOT service architecture i.e. applications, connectivity solutions, and devices.

Figure 1| Source: GSMA (2023)  IoT for Development: Use cases delivering impact

Providing solutions across multiple layers has benefits. For instance, deployment feasibility tests and network availability visualisation offerings by mobile operators can save critical resources for utilities, thus avoiding expensive field surveys. Secondly, using the analytics solutions offered by mobile operators, AMISPs can effectively track and monitor communications uptimes and service level agreements. Another example is using data on meter performance parameters to proactively understand connectivity performance and resolve issues before these can impact system uptime. In practice, Airtel’s partnership with IntelliSmart is a bundle of two core capabilities – connectivity and cloud, thus making it easier and economical for the IntelliSmart to deploy their smart metering stack. Through such partnerships, operators continue to significantly contribute towards fast-growing smart metering deployments in the country.

Challenges

While enormous progress has been made, it looks likely that the target of 250 million meters deployed by 2026 may be missed. GoI data shows that over 222 million smart meter tenders are approved, of which 115 million smart meter contracts are awarded, but only 12.4 million meters (6%) are deployed. The smart metering initiative is driven at the national level by GoI, however, its implementation also requires action from and coordination with state and local governments alongside DISCOMs.

While the deployment of smart meters requires a push, there are other challenges that also stand out.

• Cybersecurity:  Cybersecurity is essential to smart metering to protect sensitive consumer data. Increase in attacks on network connectivity, and the infrastructures will require implementation of robust security measures, and standardised security protocols. Media reports suggest India’s power sector faces at least 30 cyberattacks daily. Therefore, DISCOMs alongside both state and central government must invest in cyber secure systems.
• Consumer awareness: It is important that consumers understand what smart meters are and how they can benefit them. Lack of awareness can lead to resistance against installations. Additionally, there are privacy concerns. Consumers must be informed through clear communication about data handling, privacy policies, and security measures to improve public trust.
• Legacy system integration: Integrating smart meters with existing legacy systems in utility companies can be challenging due to differences in technology. Legacy systems may not be equipped to handle the real-time data flow, or the volume of data generated by smart meters. The integration process can be complex and will require substantial time and resources, including training staff to manage and maintain the new systems effectively.
• Capacity Building: Smart metering will require significant IT and digital architecture, specialised IT workforce, and a standardised digital framework that ensures interoperability between different systems reducing the complexity of integrating with both new and legacy systems. Additionally, business processes that align with digital capabilities will need to be built into governance of DISCOMs.
• Data Management: Smart meters generate a vast amount of data, and utilities must have the appropriate systems and tools to handle, store, and analyse this data. Without proper data management strategies, the sheer volume of data can overwhelm system capacities. Moreover, collecting data is only the first step. The critical challenge is processing this data into actionable insights. Utilities will need advanced data analytics capabilities to interpret the data effectively and make informed decisions about energy distribution, demand response strategies, and customer service improvements. This is possibly where AI and machine leaning models can significantly help, given the limited workforce deployed within utilities.

Looking ahead

The energy sector reforms in India have already resulted in technical and commercial losses coming down from 22% in 2021 to 16% in 2022. The reduction in these losses have helped close the gap between the average cost of supply and the average realised revenues from Rs. 0.69/kWh to Rs. 0.15/kWh over the same period, a critical indicator of utility financial health. Financial losses of DISCOMs have also come down, from Rs.46,521 crore ($5.6 billion) in FY 2021 to Rs.31,026 crore ($3.7 billion) in FY 2022.

Total IoT connections, including smart meters, are set to double 2020 to 2030. A major trend that will define the decade is that enterprise IoT, which includes many utility sector deployments, will overtake consumer IoT. With mobile operators well positioned to implement AI and big data solutions for the estimation of demand, detecting anomalies in energy usage, load forecasting, or loss detection.

Smart metering is a core component of smart cities, with both gas and water supply in a similar position to benefit from smart meter deployment. The synergy between technological innovations and the strategic involvement of mobile operators is pivotal to realise the full potential of smart meters in India. Mobile operators are well positioned to play an important role in the modernisation of India’s utility infrastructure, and it is encouraging to see operators taking a strategic approach to contributing to this key GoI national development objective.

The GSMA is dedicated to advancing the smart metering ecosystem in India by fostering collaboration among AMISPs, mobile operators, governments, and innovators.

Join the upcoming event

This year, in September 2024, the GSMA is hosting a closed door convening to discuss critical challenges that need to be addressed to propel the smart metering ecosystem in India. Please get in touch with us to find out more about the ‘Digital Urban Utility Forum’ and explore potential areas of collaboration

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This initiative is currently funded by UK International Development from the UK Government and is supported by the GSMA and its members.