Should smart meters ship with additional memory and processing power, plus an operating system to run applications? Several meter and communications vendors have taken a step down that road, including Echelon and SmartSynch. Now a UK firm called Sentec wants to take things to the next level. If it succeeds, next-generation meters will look less like old-fashioned meters with a communications module grafted on. And more like smart phones for energy (with apps and all).

I use the Discovery Showcase series to highlight new companies and new ideas. I bumped into this latest concept at Metering Europe in Amsterdam this October. If the concept takes off it could insulate utilities against the obsolescence issue – the fear that smart meters will need to be swapped out in just a few years. And it could send meter makers scrambling back to their labs to catch up.

(It might even put meter makers in direct competition with utilities. More on that below.)

The Sentec formula

The Sentec formula is lots of flash memory, plus a more powerful processor, plus – here is the new part – an operating system that would be the same from meter to meter. In theory, this means “apps” developed for one brand of meter would run on others, provided they used the Sentec operating system. Internally, Sentec calls its operating system for meters “Breeze,” though it has not yet launched it formally to the outside world.

If the idea catches on, the meter will evolve from a relatively dumb measurement device into a smart, sophisticated, upgradable platform for multiple applications – more like a home gateway. It is certainly true that meters should ideally be field upgradable. And capable of posting new applications as we dream them up. That need is being addressed to a limited extent by many of today’s vendors. The Sentec approach would be like the move from “feature phones” to “smart phones” in the cellular world.

The Sentec track record

There is reason to think that Sentec can indeed move things forward, given its track record. The UK-based company was awarded the 2010 Queen’s Award for Enterprise. It won in the Innovations Category for its “Sterling” technology, which is at the heart of smart water meters such as the Sensus IPERL. (Sentec also provided the guts of the Sensus ICON electricity meter.) Sentec has also pioneered Gridkey, a system for monitoring substations with small, low-cost, clip-on sensors.

Should utilities spec their own meters?

There’s another interesting angle to the Sentec strategy. For years the company has been a behind-the-scenes partner to meter manufacturers such as Sensus. Now the company hopes to convince utilities to ignore those manufacturers and specify their own systems. With Sentec as their consulting partner to spec the design and have it built via the company’s network of contract manufacturers.

Sentec alleges utilities can have the superior meters at little or no extra cost. For one thing, Sentec claims to be expert in designing ultra low-power, low-cost solid-state meters. Second, it works with contract manufacturers and takes advantage of their economies of scale. Sentec maintains that meter makers with captive manufacturing plants end up with higher costs in the long run. (Something those manufacturers vigorously deny.)

“Bespoke” meters for the price of “off-the-rack?” Well… in Europe, Asia and Brazil maybe, where utilities are large enough to get economies of scale. Not in North America, where (all but a few) utilities are too small by themselves and too stupid or too stubborn to join together into buying consortia. As a result, American utilities may well overpay $2 billion for their smart meters, as I documented in January 2011.

All of this is part of the smart grid platform wars which are being waged on many fronts. With the entry of Sentec, the battle may move down to the meters themselves and to which “operating system” they run.

Jesse Berst is the founder and chief analyst of Smart Grid He consults to smart grid companies seeking market entry advice and M&A advisory. A frequent keynoter at industry events in the US and abroad, he also serves on the Advisory Council of Pacific Northwest National Laboratory’s Energy & Environment directorate.