AMP’s AMI Program: Purpose Built for Municipal Utility Systems

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August 2018

The evolution, introduction and implementation of advanced technology, such as advanced metering infrastructure (AMI), is taking off across the utility industry as public power communities and systems embrace the new norm. For an industry that has essentially maintained the same basic operational structure since its inception, now is an exciting and all-important time for the electric utility industry.

Efforts are being made across the nation to learn more about an advanced or otherwise modernized electric grid, as well as ways to best develop forward-focused strategies around the technologies involved. Many states are taking on the task of leading discussions between industry stakeholders, regulators and innovators regarding the opportunities that advanced technologies provide. Some of the key initiatives active now include: NextGrid – Illinois’ study regarding the “Utility of the Future”; e21 Initiative – Minnesota’s grid modernization effort to “shape an electric system for the 21st century”; Reforming the Energy Vision (REV) – New York’s effort “to build a clean, resilient and affordable energy system”; and PowerForward – Ohio’s “review of the latest in technological and regulatory innovation that could serve to enhance the consumer electricity experience.”

With efforts underway to address aging infrastructure and modernize the electric grid, many communities are seeking best practice advice. Customers of utilities of all sizes are seeking the services and capabilities of a smarter grid, and many communities are unsure of how to provide that. Creating a customer-facing, modernized grid that utilizes the data being produced by customers to enhance grid performance and efficiency is quickly becoming a requirement.

The foundation for a modernized grid is AMI, which is defined by the U.S. Department of Energy (DOE) as an integrated system of smart meters, communications networks and data management systems that enable two-way communications between utilities and customers.

According to a December 2017 report published by the Edison Foundation, more than 72 million smart meters had been deployed by the end of 2016, with 90 million more expected to be installed by 2020.

Improving public power systems

The business drivers for AMI technology are plentiful. Aging infrastructure is a real threat for the entire industry. Meter reading practices and technologies are outdated and inefficient. Too often, handheld meter reading devices are failing and lack necessary technology updates. In many communities, meters are aged beyond the expected lifespan of 25 to 30 years, and the rate of misreads is concerning. Consumption by inactive meters and bad debt accrued by uncollectible accounts can lead to a significant loss on the part of municipal utility systems. AMI provides an opportunity to improve the business processes of the utility, large or small, and allows for an enhanced customer service experience.

It is important for public power systems to remain competitive. AMI supports emerging trends that allow municipal utility systems to stay on pace with other technology deployments such as LED street lighting control, SCADA system integration and customer-owned solar and storage.

Creating a platform

Many of the greatest benefits of AMI relate to its ability to serve as a utility’s base for ever-emerging technology. AMI provides a platform on which other consumer-focused services and programs can nest. For example, advanced outage management systems rely on AMI to automatically provide utilities with information on potential system failures, allowing utilities to detect possible issues before an outage ever occurs. In their DOE AMI case study, the Potomac Electric Power Company (PEPCO) – District of Columbia, found using AMI data for transformer load management has helped them to more accurately and proactively replace trouble transformers. Emergency replacement of a failed transformer generally takes much longer than those associated with planned outage replacements. The utility found that AMI greatly improved their outage numbers, leading to the prevention of over 6,000 customer outages.

AMI also allows municipal utility systems to respond to what their customers want and expect from their utility, such as rebates for peak shaving and rate design changes to help keep costs low. In the traditional rate-design model, efficiency-minded consumers ultimately find they are simply subsidizing prices for inefficient energy users and not realizing actual cost savings related to their conservation efforts. AMI allows for expedient communication between customers and the utility, which can allow for real-time monitoring of energy usage. This capability creates an opportunity for real and effective changes to pricing structures, such as variable pricing models, which encourages off-peak power usage and can lead to major savings for customers and the utility. A study by Ameren Corporation found that, if effective, a program [such as the Hometown Connections Advanced Metering Program] could see a participation rate as high as 40 percent among residential customers and between 3-6 percent among commercial and industrial customers.

“The change from a combination of radio and manual read meters to AMI meters has required a tremendous amount of coordination and preplanning. It got frustrating at times, but AMP always worked with us and resolved any issues quickly. We have been installing electric meters for about three weeks and this process has been smooth. When this project is completed, the City of Seaford will have the strongest infrastructure and CIS system information we have ever had to work with. The benefits the citizens will see and the tools we will have to work with will benefit the City of Seaford for many years.”

— Bill Bennett, director of electric, City of Seaford

Recognizing the need to advance

Just as the larger investor-owned utilities, municipal utility systems need to address aging infrastructure and efficiency issues, enhance the customer service experience and provide their customers with the communications, information and products that have come to be expected.

In 2012, the AMP Smart Grid Advisory Committee (SGAC), which consisted of AMP members and staff, began discussions around business cases and system and customer benefits of AMI. Soliciting input from member communities, AMP learned of several common hurdles members were facing:

• Exploring the marketplace limitations
• Managing relationships with a new group of vendors
• Supporting complex, evolving and integrated systems
• Hiring, training and retaining skilled IT staff
• Planning for future expenses
• Dealing with cybersecurity issues and requirements
• Leveraging strategic relationships with partners
• Negotiating IT contracts

For some municipal utility systems, these obstacles can be daunting. To overcome this, AMP and Hometown Connections, Inc., (HCI) offer an AMI solution built specifically for the unique needs, objectives and complexities of municipal utility systems.

The AMP-HCI program’s pioneering design utilizes extensive utility experience and partnerships with expert service providers focused on reducing management complexity, lowering long-term risk, improving operational and system efficiencies, and forecasting, or otherwise predicting future costs of complex technology systems.

Municipal utility systems utilizing the program will deploy a best-of-breed infrastructure (meters, wireless network communications, applications and systems integrations) enabling the use of and support for a wide range of innovative and advanced technologies to serve the utility’s current needs and provide a platform for future smart city initiatives.

“The results of the AMI project for Ephrata have been outstanding. The expected benefits were exceeded in the first few months while system losses were cut in half.”

— Tom Natarian, director of operations for the Borough of Ephrata

The following highlights a few of the technology features:

• Mature technology partners with millions of deployed meters and hundreds of application integrations to public power CIS, GIS, SCADA and OMS systems.
• No meter lock-in — supports electric, water and gas meters from a number of major manufacturers.
• Industry-leading radio frequency (RF) wireless networking technologies paired with standards-based communications for maximizing reliability and openness to ensure maximum useful life out of the investment.
• Service level agreement guaranteeing network availability and meter reads.
• Advanced cyber protection, full disaster recovery and 24/7/365 security and operations monitoring of all systems — ensuring a functional and robust meter-to-cash process.

Deploying AMI provides participating municipal utility systems with numerous benefits including reductions in implementation risk and long-term operations complexities, cost savings through joint action and the provision of service level performance guarantees.

“Changing to advanced metering technology requires the coordination of many different vendors and components. It is a complex project. With AMP’s guidance and direction, the project is being implemented successfully. Implementation has not gone without issues, but AMP’s team ensures that each problem is handled quickly and efficiently. While we endured problems on the backend, the transition seemed seamless to the customer.”

— Mark Whitfield, public works director, City of Milford

The AMP-HCI Advanced Metering Program information technology architecture is built according to industry best practices with an emphasis on cybersecurity that includes encryption of communications and active defense measures to detect and stop cyberthreats. Setting the foundation for future communications needs with advanced capabilities such as street lighting control, environmental monitoring, distribution automation and demand response, the program allows subscribing utilities of all sizes to deploy the foundational components of a smart city.

Learn more about AMP’s AMI Program here on the AMP website and here on the HCI website. If you have questions, please email [email protected] or reach out to your AMP marketing representative.

 

Case Study: Borough of Ephrata

The Borough of Ephrata, an AMP member community, subscribes to the Advanced Metering Program and began AMI deployment in April 2017. Throughout the summer of 2017, Ephrata replaced more than 6,700 electric meters with AMI technology and the realized benefits are far exceeding expectations. For Ephrata, as with electric systems everywhere, system loss rate is an area of concern. According to the U.S. Energy Information Administration (EIA), electricity transmission and distribution losses average about 5 percent of the electricity that is transmitted and distributed annually in the United States. At the close of 2016, Ephrata’s system loss rate was 7 percent (as reported to the EIA). At the close of 2017, less than a year from AMI deployment, Ephrata reported its system loss rate as 3.6 percent. Without any other enhancements or additional efforts, the installation of advanced metering infrastructure decreased Ephrata’s system loss rate by nearly half.

In just over a year since completing their AMI deployment, the Borough of Ephrata is realizing several other related benefits. Ephrata is experiencing a notable increase in billing and customer service efficiencies. Through the AMI system, the utility is able to determine when service is in use and when it is not in use. This helps produce 100 percent accuracy when responding to customer inquiries about their bills. This is also extremely helpful in determining the end of service when one customer moves from a property and another begins receiving service at the same property. Prior to AMI, disconnection and reconnection of service required that a utility worker manually perform the task. Now, with the AMI system, disconnection and reconnection can be done remotely, which greatly improves customer service. If a customer’s service is shut off for nonpayment, and the customer subsequently submits payment of their outstanding balance, AMI makes it possible for the utility to immediately restore service for the customer, as opposed to waiting for a utility worker to restore service in-person possibly not until the next business day.