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1 Two million UK homes to get British Gas smart meters by the end of 2012

British Gas is to install two million dual fuel smart meters in UK homes by the end of 2012, ahead of the government’s own smart meter roll-out

The race is on. Utility companies across the world are rushing to roll out smart meters to millions of consumer homes and business premises. Across the pond in the US, for example, six per cent of the population has a smart meter. Closer to home, Italian trailblazer Enel, Europe's third-largest energy supplier by market capitalisation, had deployed smart meters to its entire 27 million customer base by 2005. The UK has caught on too, with plans to install a smart meter in every home by 2020 – or three years sooner, if new prime minister David Cameron gets his way. This may all come at a cost: security experts claim that the utilities' haste to deploy smart meters ahead of rivals means that important security implications may have been overlooked.
The type of meter installed will vary from country to country and from one vendor to another, but in essence they will have certain key characteristics: they will measure how much energy a household or business uses, information which will then be fed back in real-time to the utility provider via a GPRS connection. The basic premise is that smart meters allow customers to monitor their own energy use, enabling them to make reductions in consumption and carbon emissions.
A noble intention indeed, but this is not to say that consumers' hands won't be forced somewhat: in fact, meters will be compulsory. “You don't actually have a choice,” explains Joshua Pennell, founder and president of security company IOActive. “If and when the utilities decide to deploy a meter, you cannot ask them to not install one.”
Pennell cites cases in the US where customers tried to discourage their utility provider from installing a meter in their home. “The utility basically said, ‘if you don't allow us to install one, we'll simply remove the old meter and you'll have no power to your home'.”

And it's no wonder that the utility companies are so keen to deploy them. The information they collate will be used to devise a series of tiered pricing models. This means, for example, that they can price energy higher at times of peak use, to encourage consumers to use less electricity or gas at these times.

As a result, thrifty customers will save money by opting to use their high-energy appliances, such as washing machines and dishwashers, at off-peak times. It could spell good news for the Government too – if consumers respond to the incentives and use less energy, it may not be necessary to build new power stations. No wonder prime minister David Cameron pledged to commit £1bn to the smart grid project in his manifestos for both the European and UK elections.
This isn't the only benefit for utility companies. It will also cut their costs on two fronts. First, they won't have to foot the bill for staff to go out and read the meters. Second, as first:utility, the Midlands-based energy company discovered, more than 80 per cent of the queries handled by its call centres used to be about billing queries. Now, with smart meters installed, “that figure just falls off a cliff”, according to Mark Daeche, chief executive of first:utility. “The customer can see how much they're using and when they're using it, so it really has reduced the number of disputes quite dramatically,” he adds.
 But it is this detailed information that is at the centre of concerns about privacy. If the energy consumption data collated by a smart meter fell into the wrong hands, it could be useful to burglars, as they would be able to easily deduce whether a property's occupants were likely to be at home or not.
Remote control of your heating
“This is where I see issues of security on the roll-out of smart meters,” admits Daeche. “We know how important it is that this information stays private.” To reduce personal data theft, first:utility, which has more than 20,000 smart meters installed in the UK, encrypts information at the ‘head-end' servers that manage the data collection before it is sent via an SMS packet. It is then decrypted when it reaches the utility provider's system, which manages and monitors the meters.
Trevor Niblock, who is head of security for British Gas smart metering, agrees that privacy is “a really big challenge. We have the potential to collect a lot of information about our customers,” he admits. That could be the least of his worries. By Niblock's own admission, attacks on the head-end system are also a pressing concern. They could cause wide-scale outages – a denial-of-service attack. “If someone were to take control of the head-end, the potential is there to turn off a number of meters,” he says.
British Gas, and parent company Centrica, has gone to some lengths to help mitigate such threats. It employs two full-time staff with experience in security dedicated to the project, as well as a central policy and governance team that establishes the policies and practice standards Centrica has to conform to. It also partners with Deloitte & Touche, which helps the company with things such as penetration testing and risk assessment of its supply chain.
Concerns around security become even more pressing as the proliferation of smart meters paves the way for the implementation of a national ‘smart grid'. “For me, the main concern is that whole areas of countries or cities could be taken out,” explains security expert – and a Jericho Forum founding director – David Lacey. “Not only would the amount of disruption caused be massive, but it also makes you very vulnerable to other forms of attack.”

A main cause for concern is the remote connect/disconnect feature. It pretty much does what it says on the tin: it will allow the utility companies to turn the power on and off without actually having to access the property, as would have been the case previously. And because UK providers want to have this feature across all three main utility services – electricity, gas and water – that will mean all three services can be shut off remotely via a communications channel (such as GPRS) that has been plagued with security issues in the past.

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