March 29, 2024

The Value of AMI
It's so much more than billing

by Joseph O. Wambaugh, Senior Vice President

Billions have been invested, and will continue to be invested, in the implementation of advanced metering infrastructure (AMI) at electric, gas and water utilities. These AMI deployments are achieving many of the benefits identified in their respective business cases and AMI has become a critical infrastructure for these utilities. However, these early business cases relied on the basic benefits associated with meter reading and dynamic pricing/demand response. The potential value of the millions of grid sensors (yes, these aren’t just meters) with real-time communication has yet to be fully realized.

Two recent research studies1 have one remarkable and similar message – half of the utilities that have implemented AMI solutions are only collecting and using the data for basic billing purposes. It’s no wonder why some utility executives have begun questioning the value of what was spent for AMI. Implementation of AMI has the potential to bring extensive value to the rest of the utility enterprise. This is best represented by FortisAlberta’s 2008/2009 Tariff Application which states:

“The diverse benefits associated with a fully provisioned AMI system extend far beyond improvements in billing accuracy and the replacement of manual meter reading. For both customers and retailers this includes increased accuracy of outage information, quicker outage response and restoration, and more timely and detailed customer energy usage information. Additional operational benefits include more efficient distribution system planning, voltage monitoring, rate profiling, and the ability to implement remote disconnect and reconnect functionality.”


“Half of the utilities who have implemented AMI solutions are
only collecting and using the data for basic billing purposes.”

 

It’s not a meter, it’s a sensor
Today’s AMI meter is so much more than a measurement device to produce a customer’s bill. Beyond measuring and reporting energy and power values, today’s AMI meters measure and report instantaneous and average volts and power quality. These meters have configurable intelligence to provide real-time alerts when power is lost, power is restored, a condition indicating tampering is identified, power quality limits have been exceeded and thresholds of energy consumption have been surpassed. Figure 1 illustrates the extended capabilities of an AMI meter.


Figure 1. Capabilities of an AMI meter extend far beyond billing
 

In addition to the type of data that can be collected from AMI meters, the frequency and latency of delivery of the AMI solution allows for data to be collected and delivered daily, several times per day and even every 5 or 15 minutes. Properly configured, the AMI solution should be able to collect, validate and distribute grid sensor information at any endpoint as required to better operate, analyze and optimize the electric distribution grid. Several applications and services have emerged lately to use this data to better detect and manage outages, execute new demand response programs and to better optimize the distribution voltage.

Value in distribution management
Real-time alerts and alarms from AMI provide quicker outage detection along with power restoration information used by sophisticated outage management systems (OMS) and enhanced business processes to reduce outage durations and improve communications to customers.

The integration of AMI with OMS, and the associated challenges, has been written and talked about for several years. Outage management systems have been enhanced to leverage the integrated AMI and recognize benefit from:

  • Faster outage detection and isolation by utilizing the outage alerts to augment IVR and SCADA events. Some utilities have reported an improvement in reliably identifying power outages of up to 15 minutes using properly filtered and validated AMI outage reports in addition to customer calls
  • Validate restoration activities by accepting power restoration alerts and proactively requesting power status from the AMI meters
  • Identify nested outages where power has not been restored
  • Validating single lights out calls prior to dispatching trouble crews by “pinging” the AMI meter

One utility, JEA in Jacksonville, FL, is going the extra mile for its customers by integrating AMI, OMS and their customer portal to provide customers with individual notification of power outages, power restorations and cause of the power outage. While currently in pilot form, this capability will be made available to all customers with the goal that any customer should be notified of an outage or restoration within 15 minutes of occurrence and notified of the cause of the outage within 24 hours.

Conservation Voltage Reduction (CVR) has been used for many years to maintain the voltage on the distribution feeders in the lower band of the National Service Voltage Standard (ANSI C84.1). This reduction in voltage provides demand reduction by lowering the energy consumption of the end consumers as well as providing some improvements in power system efficiencies. Recently, utilities have been incorporating AMI data as feedback into the CVR programs to further lower the distribution voltage, gain more confidence that the end consumers are unaffected by the voltage reduction and maximize the value of the voltage reduction. In addition to voltage reduction and voltage management, the power quality alerts and collected voltage data allows the utility to proactively identify and resolve situations before they lead to high voltage complaints and even damage to customer equipment. Dominion Virginia Power submitted a business case for the deployment of AMI for which the benefit from CVR provides the majority of the benefits with small contribution from storm restoration, customer service and metering completing the business case. Figure 2 illustrates how voltage can be lowered with AMI data. Voltage control without AMI feedback (see left side of figure) results in higher voltages and increased losses, while voltage control with AMI feedback (right side of figure) yields a tighter range and lower losses.


Figure 2. Improving voltage reduction with AMI data
 

The granular (5 to 15 minute interval kWh) load data from every endpoint of the grid should fundamentally change the approach which engineers and planners take to design, grow and maintain the electric distribution network. Management of distribution assets and network capacity is typically performed using engineering models built from many years of experience. The load data provided from AMI can be used in these models to refine and improve the accuracy and provide various seasonal and loading scenarios for planning purposes. One benefit which utilities are realizing from this load information is the management and reduction of distribution line losses.

Distribution line losses are power that is generated, yet not delivered, and consequently, not billed for. Reduction in those losses can save a utility the cost of energy (either the wholesale price of energy or the marginal price, depending upon the regulatory model for the utility) that would have been required to generate the ‘lost energy.’ A reasonable expectation for improvement of up to one percent in technical and non-technical (theft) losses can result in real savings for the utility. The capture of these benefits is enabled by AMI, but requires the utility to invest in personnel and equipment to realize the value through:

  • Feeder rebalancing
  • Better capacitor placement and utilization
  • Improved conductor sizing and, where appropriate, conductor re-sizing
  • Optimization of voltage equipment (load tap changers and regulators)
  • Capacitor automation
  • Loss minimization functionality provided via DMS

Finally, the flexible and configurable features of the new AMI solution allows the utility to tweak and adjust the network and alerts to tune the operation of the electric grid and continue to gain incremental improvements in efficiencies and utilization. The AMI meters (sensors) and network is a dynamic system which allows the utility engineers to adjust the type and granularity of the data as well as the many alerts and quality monitors embedded in the solution.

While not widely implemented, the AMI solutions are quite capable of supporting the following functions and the utility engineers and management should be insisting on these capabilities:

  • Establish bellwether meters and near real-time streaming energy and voltage data
  • Individually, or as a group, settable thresholds and alerts from service delivery points
  • Identify groups of service delivery points for purposes of aggregated energy consumption and the delivery of historical and streamed aggregated data
  • Coordination of communications configurations to maximize data delivery and minimize latencies based on immediate needs for information

Barriers
As the utility leverages the advanced metering infrastructure and AMI data, the utility engineers and managers begin to realize the range of value that can be realized from this installed infrastructure. Those utilities who were the early adopters of AMI (or AMR) have achieved value from their networks that was never contemplated when the systems were installed 15 or more years ago. So, if many see that the value of AMI extends well beyond just meter reading for billing, why aren’t enough utilities taking advantage of this value? In some cases, the initial implementation of AMI did not account for anything other than simple billing during the design and configuration of the meters and information systems. It is not uncommon to hear “We only saw the need to read for billing” when asked for the requirements a utility envisioned. In other cases, the project team is so focused on installing AMI meters and the requisite data cleanup issues that any activity beyond basic billing is deferred. And most disconcerting was a report from a distribution operations manager at one large utility who said, “Every time we ask for access to the AMI system and data, we get a hand in the face and are told that this is a critical billing system.”

Overcoming barriers
The first step of any benefit realization is to fully define what you really want for the system and to ensure that the AMI solution has been configured to deliver all of the available data and is operated in a manner that ensures the reliable capture of 100 percent of this data every day. The sensors (meters), communication network and interfaces should be configured with all uses of the solution in mind and all potential users of the solution should participate in the initial requirements development and design to ensure that their needs are accounted for. Throughout the implementation and deployment it is important to avoid thinking: “Well, I don’t need this for billing.” As an example, one of the early adopters of AMI specified the need for only index values of kWh (e.g. 12345 kWh) only to discover several years later that ‘beyond billing’ users required data granularity down to the Wh.

The utility implementing an AMI solution should plan for multiple ‘business releases.’ The first phase of any AMI project is the initial configuration and integration of the critical ‘meter to cash’ systems needed to install and bill customers – AMI, MDMS and CIS. The second business release after this first phase should be focused at another business user such as distribution operations. These focused releases ensure that all users are prepared to use the data from the AMI solution and can plan the enhancement and integration of their systems and processes to enable the new capabilities and benefits. The ‘beyond billing’ benefits of AMI are only achieved with additional systems integration, disciplined execution of defined business processes and, in some cases, investment in infrastructure.

Finally, the utility needs to actively promote and encourage the use of the AMI solution. The best ideas for how AMI data can help improve efficiencies and existing systems will come from the engineers and technicians performing the day to day electric utility business. During one early AMI implementation, a planning engineer asked, “Can you provide data for all the meters on a transformer during the peak hours of the day?” This led to a quick information pilot and ultimately to a completely new approach to Transformer Load Management (TLM) which is saving that utility millions of dollars a year.

Conclusion
A properly designed and operated AMI solution should be able to deliver all of the intended functionality without impact to any individual user of the system or data. Utilities and their partners must design the solution and establish the operational structure so that AMI value and features are available as they are needed and flexible enough to support the new uses and opportunities that will arise over the next 15 years. The value of AMI extends to all parts of the utility organization and it is a critical platform to enabling many opportunities for efficiency, performance improvement, and customer satisfaction.

About the author

Joseph O. Wambaugh is a Senior Vice President at UISOL (An Alstom Company) and manages UISOL’s AMI and MDM practice. He has over 20 years of experience in defining, implementing and operating smart metering and meter data management systems for the utility industry. John holds an MS in Metallurgical Engineering.