The installation of smart meters can be considered a discreet revolution that is already underway in many countries around the world, including Romania. Smart meters must ensure the bidirectional communication between consumer/prosumer and the distribution networks operator (DNO) while promoting energy efficiency services. Thus, on the one hand, the customers can get accurate information online regarding electricity consumption and production, which allows them to take measures to become more energy efficient. On the other hand, DNOs provide accurate data on the consumption pattern, enabling them to manage and better plan their investments in networks. DNOs will ensure, in accordance with the result of mandates M/441/EC [1] and M/490/EC [2] in the field of smart metering and smart grids, that consistent and more cost-effective developments in the fields of communications and information will establish a more effective management of the network [3].

It all began in 2009 when the European Parliament approved the third energy package of the European Union (EU) (Directive 2009/72/EC), a legislative initiative aimed at principally improving the competition in the electricity and gas markets. In Romania, the early stages for the implementation of smart metering began that same year. Initially, several pilot projects that focused on the installation of automatic meter reading—with only 15,000 customers that implemented advanced metering management—were ongoing. For these stages, during 2009–12, the information is presented as a whole in Table 1 [4]. The residential consumers completely dominate, constituting 99% of all electricity customers in Romania. The share of nonresidential consumers (such as industry and small and medium enterprises) is approximately 1%. A very small number of the smart meters was until now installed at residential customers, and hence a high potential for the implementation of smart metering system can be identified [5].

At the end of 2012, the Romanian National Energy Regulatory Authority (ANRE) published a study carried out by the Global Management Consulting Firm—A.T. Kearney, at the request of the European Bank for Reconstruction and Development (EBRD). The study focused on the feasibility of introducing and using the smart meters in the markets for electricity, natural gas, and heat from Romania. Based on this study and others made by some DNOs, the smart electricity distribution has become a priority of ANRE, which, starting from Law No. 123/2012 on electricity and gas, issued Order No. 91/2013 that provides as a national target the implementation of smart metering systems for electricity to approximately 80% of the final consumer number by 2020 [6]. In accordance with Romanian law on electricity and natural gases, the same study assessed the implementation of smart metering systems from the viewpoint of long-term costs and benefits to the market, profitability, and feasible implementation deadlines [7]. The reduction of electricity losses, lower operating costs, and utilities could lead also to increase the benefits. Other important aspects were about relevant elements of the cost-benefit analysis and an effective approach to install the smart meters [5]. The feasibility study, including the results of the cost-benefit analysis, indicated a positive net present value. This led to the conclusion that the implementation of smart metering in the electricity sector has the potential to be a profitable investment due to the benefits from reducing electricity losses in electric networks and decreasing operating costs under certain conditions and assumptions.

Because the results of the cost-benefit analysis were positive, ANRE has proposed a plan to implement the smart metering system, taking into account the best practices, latest technologies, appropriate standards, and the importance of developing the electricity and gas markets. A suggestive time frame for the implementation of smart metering in Romania is presented in Fig. 1 [8].

1.2 Romania versus European countries

The monitoring done since 2011 by the European Commission (EC) [9] showed that progress has been strongest in countries with a significant impulse in the regulatory field (Fig. 2).

It can be observed that many so-called “dynamic movers” took into account very ambitious rollout plans. Furthermore, the minimum requirements of smart meters have been clarified in most of these countries. On the other side, countries that are classified as “market drivers” had only moderate progress. In general, it should also be said that in many countries there is still a lot of skepticism among consumers and private companies. Romania belongs in the category “waverers” [9].

Along with 16 other states from the EU that have decided in favor on a large scale (> 80%) for the implementation of electricity smart metering after cost-benefit studies, Romania had an official decision pending. In these studies, Romania and Poland were specifically mentioned, emphasizing that although the feasibility analyses indicated positive results, the formal decisions regarding the beginning of some national projects have been delayed. This aspect was highlighted by the EC in 2014, and it is shown in Table 2 [10].

Different indicators resulted from the study made for Romania [5,6]. These indicators reflected the total costs per the information collected, adjusted to reflect the best electricity-specific activities. Thus, the total costs per categories were estimated as 648.2 million euros, and the average costs per metering point per categories (based on a 15-year modeling period) were 77.35 euros. These costs are some of the smallest from the EU. A comparison between costs from different countries is presented in Figs. 3 and 4 [11]. The signification of abbreviations for countries is given in Table 2.

However, the analysis based on the recent pilot projects has led to the conclusion that, in Romania, the average cost per metering point increased to €122. The components of this cost are represented by the following: smart meters (€75), communications (€10), information technology (€4), distribution (€25), and others undefined costs (€8) [11].

1.3 Configuration and key functionalities of the smart metering system in Romania

The assessment of the model corresponds to a “middleware layer” design. It contains the following main components: data concentrators and balancing meters installed on each electric substation from the distribution network and meters placed with customers. The data communication occurs through power line communication (PLC) wiring from the smart meters to concentrators and through various communication channels from concentrators to a central database.

Most DNOs have adopted a similar configuration, as depicted in Fig. 5.

The establishment (through regulatory tools and mechanisms) and the use of open standard communication protocols played a very important role in the connecting of smart meters to the data concentrators and then to the central database. Such an approach avoided the massive investment in equipment that is not interoperable, cannot log, or generates errors in the data transmission when purchased from different suppliers [5]. The key functionalities of the smart metering system used in Romania are indicated in Fig. 6.

The adopted solution for the smart metering system in Romania has a low cost with minimum functionality. However, the benefits could decrease due to the minimum functions.

In Romania, there are eight DNOs that serve more than 9 million customers [7]:

1. 1. CEZ Distributie (CEZ)—15.1% electricity distributed nationwide.
2. 2. ENEL Distributie Banat (ENEL-B)—9.8% electricity distributed nationwide.
3. 3. ENEL l Distributie Dobrogea (ENEL-D)—8.4% electricity distributed nationwide.
4. 4. ENEL Distributie Muntenia (ENEL-M)—16.2% electricity distributed nationwide.
5. 5. E.ON Moldova Distribuţie (E.ON) (in January 2017, changed its name to DELGAZ GRID)—10.3% electricity distributed nationwide.
6. 6. ELECTRICA Distributie Transilvania Sud (Electrica-TS)—13.3% electricity distributed nationwide.
7. 7. ELECTRICA Distributie Transilvania Nord (Electrica-TN)—11.6% electricity distributed nationwide.
8. 8. ELECTRICA Distributie Muntenia Nord (Electrica-MN)—16.2% electricity distributed nationwide.

The share of electricity distribution nationwide corresponds to the year 2015, when the total electricity distributed was approximately 42.4 TWh.

Each company is responsible for the exclusive distribution of electricity within its licensed region, based on a concession agreement with the Romanian state acting through the Ministry of Energy (see Fig. 7).

Beginning in 2013, all DNOs developed pilot projects to evaluate the efficiency of the smart meter implementation program. Thus, a homogeneous implementation (pilot projects in the regions covered by DNOs) is given by [6]:

• • The installation of smart meters for consumers from the urban/rural areas served by a DNO for each demonstration project.
• • The permanent monitoring of electricity consumption by consumers (online) to enable them to benefit from the positive impact of energy efficiency measures to be implemented as well as the immediate impact of pricing policies to be applied on the behavior of nonresidential electricity customers.
• • The recorded data that must be sufficient to analyze and optimize the functioning of distribution facilities and equipment in order to increase the efficiency of networks. These data must allow the rapid identification of action points.

The expected results of the pilot projects were the following [6]:

• • Installation of smart meters enables DNOs to reach their target of approximately 80% implementation of final customers by 2020, as required by Law No. 123/2012 [12].
• • For selected areas, the electricity consumption will decrease by 10% due to the smart management at the consumer and the distribution levels.
• • To support the model that DNOs use for the implementation of smart metering.
• • Savings of around 300 MWh/year/project (based on the annual average electrical consumption of urban families in Romania).

Through these projects, the technical possibilities for achieving the solution of smart metering and the customers’ benefits in the new system are investigated. On the other hand, an analysis related to data protection in the system of remote reading and the protection of communication lines is deepened.

Based on the experience acquired in 2013, by the end of the next year, ANRE had issued an order regarding smart metering, called the “Order on the implementation of smart metering in electricity” [13], which provides, in addition to a range of general functionalities of smart metering systems, general data on the implementation plan and a description of the pilot projects.

According to the regulatory stipulations on the deployment of smart metering systems, DNOs.

submitted proposals to ANRE for the realization of some pilot projects in 2015. Those results were to provide needed information to establish the conditions and tools on the developing of a schedule and a national plan for the implementation of smart metering.

ANRE approved 18 pilot projects worth 69,639,770 lei (approximately 15.48 million euros) in 2015 (see Table 3 [5]). For these projects, a set of performance indicators was defined for smart metering systems so that progress could be monitored during the implementation process and a period thereafter. The performance indicators relate to the following issues: the status of implementation, the structure of intelligent metering systems, the economic effects, the quality, and the security of information. These indicators will be applied to all these pilot projects so as to verify the achievement of proposed objectives.

The implementation areas were defined and the characteristic data and information have been set in terms of the technical, economic, sociodemographic, and qualitative aspects. The processing of these data is aimed at prioritizing a hierarchy of the areas for each DNO through a multicriteria analysis to assess the potential implementation of smart metering systems and the preparation of the national plan.

The analysis report on the pilot projects for each DNO given by ANRE in August 2016 [14] showed the following important aspects:

• • Postimplementation results on the benefits in question are not relevant to all pilot projects.
• • Cost-benefit analyses did not allow a comparative study based on the obtained results.
• • The initial assumptions are different, depending on the business strategies, with the specific aims and focus of each DNO.
• • Cost-benefit analyses are positive for ENEL Distributie, E.ON Distributie, and ELECTRICA Transilvania Sud but negative for CEZ Distributie.

The result was the need for ANRE to impose a detailed model of cost-benefit analysis or the performance of a cost-benefit analysis for all DNOs, possibly through an impartial external consultant in order to avoid allegations of nontransparency and lack of objectivity [14].

However, the final targets vary from a DNO to another as follows: ENEL target 80% by 2020 and ELECTRICA and CEZ < 50% while E.ON targets more than 50% [15].

Smart metering provides more accurate billing of the electricity used based on real consumption and decision making on the tariff for the flattening of the load curve and reduction of the invoice. Additional reasons for the implementation of smart metering in the electricity sector are the benefits to the entire society, which may result from the installation of smart grid solutions (smart grids) based on a smart metering infrastructure [24]. Also, significant reductions in electricity consumption and CO₂ emissions can be obtained by providing information about consumption on central Internet portals, which consumers can access directly or at electronic devices located at the consumption point. In addition, the “demand response” solutions can help to reduce the peak load using information from the smart meters. The level of expenditure, the losses in the electricity distribution networks, and the volume of investments are supervised indicators in order to improve the quality of the distribution service due to the implementation of smart metering in Romania.

Thus, smart metering will have a direct impact on:

• • The need to increase energy efficiency through a greater transparency of metering information as well as encouraging the consumers to change their consumption behavior.
• • The pressure of regulatory authorities for a decrease of the cost by reducing electricity losses and the costs of meter reading and through a better identification of the required investments.
• • The education of consumers to reduce the consumption at peak load.
• • The environmental protection (reducing the peak load will lead to a decrease in electricity production and the use of power plants with high emissions of carbon dioxide).
• • The security of the electricity supply by introducing the flexible infrastructure and minimizing the number of power plants while increasing the share of electricity production from renewable sources.

From the point of view of DNOs, smart metering could follow and improve the state parameters and operation conditions of distribution networks, contributing to increasing energy efficiency. This could be done by reducing their own technological consumption (technical and commercial), the interruptions in power supply, the number of incidents, the voltage dips, the expenditure level, the investments, the operational costs with meter reading, etc.

In Fig. 11, an evolution of electricity losses assumed by each DNO beginning with 2014 is presented [24].

These values will be obtained based on the investments of DNOs in proper distribution networks aiming for modernization measures (replacement of aging equipment and installations) and measures for the implementation of smart grid technologies (distribution automation, distributed generation, smart metering, etc.).

Fig. 12 shows the estimated electricity saved from 2014 to 2020 from distribution networks set out in the national action plan to achieve the target assumed by Romania and the compliance with requirements from Directive 2012/27/EU [24].

The targets are obtained only if the above technical measures are adopted. The implementation of smart metering influences the operation of distribution networks. Thus, the optimal decision making based on information from the smart meters can lead to higher electricity savings.

For the implementation of smart metering in Romania in the period 2017–20, the estimated electricity savings are presented in Fig. 13 [24]. These savings lead to a decrease in nontechnical losses.

In terms of pollutant emissions, about 0.437 kg of CO₂ are emitted per kWh generated. Thus, the decrease of pollutant emissions (for the data from Fig. 13) can be seen in Fig. 14. It can be observed that total pollutant emissions decrease with approximately 76,221 ton of CO₂.

In the following paragraph, the results obtained in three case studies will be presented to demonstrate the positive impact of implementation of smart metering on the operation and planning of distribution networks.