Telefonica seals £1.5 billion smart meter deal

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Telefonica has revealed it has won the world’s largest machine-to-machine (M2M) contract to date through the UK’s smart meter programme

Telefonica UK has announced a double deal worth £1.5 billion which will see it provide smart meter communication services as part of the Smart Meter Implementation Programme of Great Britain (SMIP).

The two agreements, which both last for 15 years, will see Telefonica provide the communications infrastructure to connect smart meters in the central and southern regions of Great Britain in the largest M2M contract win to date.

The deals follow an August announcement by the Department for Energy and Climate Change (DECC) stating that Telefonica UK had been selected as the preferred bidder for two out of the three communications service provider regions.

The solution selected by DECC is mainly based on Telefonica’s existing cellular network, with additional ‘mesh’ technology used to provide connections in hard to reach areas.

Telefonica claims it has successfully tested both technologies in relation to smart meters and currently connects over 400,000 smart meters in Great Britain. Mass roll out of smart meters will commence during 2015, with 53 million gas and electricity meters expected to be operational by January 2021 .

Telefonica UK digital director David Plumb said: “This contract win is a significant endorsement of the steps we have taken to focus on new digital services such as machine-to-machine communications and the leadership we are establishing in these areas. We are also proud to be playing such a central role in the delivery of a key national infrastructure programme which will transform our energy industry.”

Meanwhile, communications company Arqiva has signed a similar deal for Scotland and northern England worth £625 million. Arqiva will invest in a new smart communications network and associated equipment.

Arqiva CEO John Cresswell commented: “Following the news a few weeks ago on preferred bidders, Arqiva is immensely proud to have won the tender to provide the smart metering communications service in Scotland and northern England.

“This reflects the strength of our proven solution and our exceptional track record in delivering and running critical national infrastructure. Smart meters are vital in empowering consumers to save energy and this is the first step in delivering an energy secure Britain.”

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