dvanced metering infrastructure (AMI), integrating two-way communications with energy measurement, is on the front lines of utility Smart Grid deployments, promising major energy savings by changing how and when customers use electricity. According to a new report from Pike Research, more than 250 million smart meters will be installed worldwide by 2015, representing a penetration rate of 18% of all electrical meters by that time, up from 46 million in 2008.

"Smart meters are the vanguard of Smart Grid deployments," says managing director Clint Wheelock. "Current ami rollouts are breaking the traditional 15-20 year meter replacement cycle, and represent an unprecedented effort to add intelligence and communications to electrical metering." Wheelock adds that, while Europe is currently the top region for smart meter adoption, North America will become the leading market in 2010, reaching 55% penetration of all electric meters by 2015.Because the Smart Grid allows two-way, digital communication between power provider and power user, electricity can be managed in real time, automatically. Who controls this management may be at issue (at least initially), but ideally both the user and the provider are involved at different levels.

Utilities know exactly how much electricity is being produced and used on the grid and where it’s being produced and used. In this way they can see potential problems and shift supply to areas of higher demand. This more efficient operation reduces brownouts and blackouts and provides better quality electrical energy.

Some energy users, especially residential customers, are happy to let smart appliances and smart meters determine the most efficient way to use energy. Commercial and industrial users may want to manage at least part of it themselves, to see the details of their energy usage and control their usage in the most effective way for their business.

In the Smart Grid, real-time production and usage data benefits both providers and users. But this vision of two-way communication an automated energy management demands open standards, because data from many sources must be aggregated, integrated, and presented visually to an assortment of users in varied formats