EET&D: This will be an especially interesting discussion for me since I’ve known Britton for many years, but Bill and I have just met during the course of this interview. Moreover, Bill has only recently been appointed to his current post – a study in contrasts I suppose you might say. I’d like to begin by asking Bill to comment on what brought him to Sensus at this point…

Yeates: My arrival at Sensus has been punctuated by the unprecedented level of activity in this vibrant utility market. With my personal penchant for all things technological, it was the Sensus focus on technology and the corresponding research and development commitment that really appealed to me. And, the more I got to know them, the opportunity to work with Britton Sanderford and the AMI team at Sensus also supported my decision to join the company that is arguably the technology leader in AMI. My core expertise is in quality assurance, on-time delivery, volume production in diverse products and local networks. I trust that these skills blended with the solid AMI team in place will assure Sensus a strong position in this explosive growth AMI market environment.

EET&D: The metering portion of the utility market has entered into the most dynamic period in a century or more. At the same time, we have observed a very dynamic period for the supplier community as well, especially among the top-level companies. Do you see this settling down at all, or should we be expecting more of the same over say, the next 3-5 years?

Yeates: As you know, Sensus has been very much a part of that supplier dynamic for over 100 years in water and gas and more recently in electricity. Notably, Sensus entered the electric utility market in the 21st century without legacy systems, providing a timely opportunity to take full advantage of the very latest and most beneficial technology without any artificial limitations. While I can’t speak for other suppliers regarding their expansion plans, our entrance to the electric meter market at an advanced technology position has already yielded positive results for Sensus and especially for our customers. Technology is – and will continue to be – an enormously synergistic component of our overall market strategy and our future.

On the utility side, I think there will probably be some fairly aggressive deployments by municipal and rural electric cooperatives during the 3-5 year time frame you mentioned, and we’re probably going to see a continuation of very large scale AMI/AMR and metering roll-outs among IOUs for the next several years as well.

EET&D: Obviously, there’s an awful lot of press these days about Smart Grid Initiatives, or SGI. I know that a lot of people think that SGI is AMI and vice-versa. What is your position regarding these frequently used – and arguably abused – terms?

Yeates: As you might imagine I have been going to school on these terms and interestingly have found a number of definitions that are not necessarily in agreement. In fact I have found so many that I suspect that no universal industry wide definition exists for AMI or smart grid initiatives. The definitions I have read bring to mind the poem about the six blind men describing the elephant – each predictably having a very different take on what constitutes an elephant, absent the benefit of sight and feeling only the part they are examining.

AMI defines the smart grid as smart meter + communications; the distribution automation folks define it as a host of distribution automation advances; IT types tend to focus on systems integration and decision software; and the list goes on to include distributed generation, demand response, and more. Maybe Britton would like to give you his take on the terminology from a technical perspective…

Sanderford: Yes, let me first point out that the communications piece is probably where all of these constituencies agree. Two-way communications – that is, to and from the endpoint, which could be a meter, smart thermostat, or even a capacitor bank controller – is an absolutely essential part of both AMI and SGI. But, somewhat ironically, that is really the beginning of where the commonality among them ends.

Two-way communications does, however, remain the principal technological foundation upon which most of the SGI master plans depend because it is tightly linked with the ability of SGI to deliver on anticipated performance objectives. SGI is the focal point of the applications and processes that use and depend on this communications infrastructure.

EET&D: Can you perhaps give us a couple of examples of how this might play out in the marketplace?

Sanderford: These days nearly everyone has heard or read about time-of-use metering, pricing signals to encourage demand response and so forth. However, some very novel and potentially pervasive SGI applications may emerge from the ubiquitous AMI communications networks, which are now being rolled out. For example, I recently attended a meeting where loss prevention was a key topic. The application required communicating with meters and pole-mounted endpoints as well as the supporting back-end software. But then, during the course of the conversation, the developer realized that AMI could provide millisecond timing accuracy, and several new applications suddenly emerged around the ability to detect power phase.

Another thing that utilities are concerned about is what will happen when plug-in hybrid electric vehicles – PHEVs – come onto the grid. With PHEVs displacing about four dollars worth of gasoline with 60 cents of electricity, utilities will soon be seeing an entirely new load on the grid. Naturally, they will want to encourage this green application – perhaps with price incentives – but new controls will be needed to prevent system overloads when commuters start plugging their cars into rechargers at about 4-5PM daily. Notably, utilities will see this new load as one that can be readily shed as a means for reacting to storms or other grid stress events. To that end, we will probably see a specialized plug on cars designed to mate only with a load-managed box that is under utility control, perhaps including a Bluetooth link that securely limits charging times.

EET&D: So, if I’m trying to prepare my utility for SGI, it sounds like communications needs to be a critical element in my plan. What are some of the other things I need to consider?

Sanderford: A key utility driver today is a growing sense of urgency; the fact that there is a need to act now. But in order to be prepared for the demand and the regulatory requirements of the rapidly changing future technology, selections made today must provide the flexibility to adapt to the changes that will inevitably drive the AMI and smart grid tools of the future. So the utility must plan for contingencies and for connectivity throughout the grid, both now and for applications that are yet to be conceived.

EET&D: What is it that we expect SGI to do for us that the current grid cannot already do?

Yeates: We are now entering a period during which we must get more functionality and more useful life out of the grid resources and assets that are already in place. To do that quickly and most cost-effectively, we will have to add significantly more automation. The reality is we are tasked with finding the right way to make that transition as smooth and as painless as possible without disrupting the reliability that we have all come to expect from our power delivery network.

In the future, the grid will have to do a lot of things that were never imagined, even as recently as a decade ago, so there’s a big challenge in front of us. And the answer may be that just as the definition of SGI is different for each segment of suppliers, what utilities expect from the grid also varies according to the type(s) of utility customers. Moreover, it makes sense that a large, multi-state investor-owned utility would not necessarily have the same future SGI needs as a rural electric cooperative.

Sanderford: Power consumers will have a much more proactive role in how and when power is used, the conduit through which it is received, the quality of the power and what they ultimately pay for it. We are currently participating with a number of utilities studying consumer response to various pricing schemes and methods. The insights derived from this initiative will help determine the technology and methods of delivery of demand response in a repurposed grid. This consumer view also represents yet another dimension of the flexible demand response technology that will continue to evolve as user requirements become more clearly defined.

EET&D: These changes contrast sharply with the old methods where we simply take the power we receive and pay as we go based on a one-size-fits-all rate scheme. What guidance can you offer regarding how we get from where we are now to where we need to be?

Yeates: That’s a tall order, Mike, but let me put some central themes on the table. Then, perhaps Britton would like to flesh them out on a more technical level. We’ve already discussed the critical role of 2-way communications, but there are some other things that also figure heavily into the future SGI picture that will allow it to deliver tangible value.

The first of these is the smart meter. At Sensus our development of a smart meter was done in cooperation with an advisory board of electric utility customers. We asked what utilities wanted in an electric meter and then built the iCon meter line specifically for electric utilities based on that user feedback. And they said demand response and remote disconnect were important. This process – learning what our utility customers want and need in the future – continues to be at the core of the development process at Sensus.

The next requirement is what we call future-proofing. Utilities want and deserve a system that will grow, change and adapt to this rapidly developing grid of the future. In our view, meters, communications modules and collectors/concentrators all need to become what I call “software-defined radios,” which affords them enormous flexibility to evolve as we go forward and identify new requirements. We can no longer rely on all-in-one chipsets that quickly become obsolete – or at least functionally constrained – when requirements change, as we all know they do.
And again, looking to the future, the communications link must also have open architecture allowing connection with, and integration into, the home area network technology, distribution automation, billing and system integration software.

EET&D: We hear the terms “standard” and “open” tossed around a lot these days. Where do these concepts fit into the picture from your perspective?

Sanderford: The trend for some time now has been to move to “open systems” with the hope that standardization will bring system compatibility, increased quality and more predictable and sustainable deployments. These are good goals, and when it comes to a company’s IT infrastructure, open systems offer many benefits. Voice and data networks, applications and extranets that support common business processes found across industries, companies, customers and vendors are some areas that benefit from open standards.

However, although virtually all AMI suppliers use the term “open,” the reality is that all AMI providers use a proprietary middle layer where the ends of these communications “pipes” are varying degrees of open. Whether or not this is an advertised feature, this is probably the best way to maintain a reasonable level of security.

Interoperability is another word often abused in our industry. I can send an email from my laptop to yours, but they are not interoperable if they use different protocols (e.g., an air card versus 802.11), and unless meters use identical communications modules they are not interoperable either. However, they can be made to talk to each other. One way to accommodate that is the use of the recently ratified EUDT2 in ANSI C12.223. Another way to insure meter integration is for meter suppliers to adopt a simple common bus from the metrology to the communication board, making second sourcing of AMI meters far easier.

EET&D: Clearly the Smart Grid transformation that lies ahead poses huge challenges – business, technological and financial – for substantially all of the roughly 3,000 electric utilities in North America. As a major player in this market, what advice would you offer to utilities as they embark on the Smart Grid path?

Yeates: The challenges of AMI and SGI will continue to require very substantial, and probably escalating investments in infrastructure – not just in metering, but all across the grid topology. Everyone knows that our entire industry is facing enormous challenges involving an aging workforce and declining infrastructure that promise to get much worse before they get better. Moreover, the sheer scale of the tasks involved suggests that these investments will necessarily be based on new and complex business cases.

Because investment in grid infrastructure has been lagging for a long time this will represent new ground for a lot of utilities, so my first piece of advice is to do your homework. The business case for AMI is not just based on the initial infrastructure or the meter change out but must also assess the useful life of the system including future proofing and life cycle cost analyses.

Sanderford: Let me also add that while AMI and the grid of the future will provide needed tools, the stark reality is that until new sources of clean, renewable, sustainable energy are found and fully developed we are very likely to see energy rationing – and most of us don’t know how to do that. In order to implement rationing in an orderly fashion there will be price incentives as well as access control. Limiting access infers automated controls, and if those controls are going to provide a material benefit, they must have just as much impact on the power flow through the distribution grid as does generation.

When we extend AMI systems to demand response; that is, to include disconnect/reconnect functions and to smart grid applications, the need for security rises exponentially. Imagine for a moment losing control of a million meters with disconnect switches. Despite all the talk about open standards and interconnectivity, the security needs for AMI may drive a level of isolation from outside systems that is more akin to the defenses used for securing power plants on the grid. We all say “open” today, but after the first hacker attack from a kid with a developer kit, I think this term will vanish – at least in the metering context.

EET&D: So how does this all relate back to Smart Grid transformation?

Yeates: SGI necessarily involves deep analysis of stability in power control networks. For example, local independent control is a possibility in SGI, but the logic and the time delays of those controls can make it virtually impossible to guarantee unconditional stability. The alternative is networks with causal single point of control, as opposed to independent distributed ad-hoc local networks.

Rationing and scarcity will also force higher levels of efficiency in generation and distribution. Substantially greater use of automation will be essential to increasing efficiency, but as any machine – the grid in this case – is driven closer to 100% capacity utilization, any latent faults or deficiencies will become readily apparent and cause disproportionately higher downstream consequences than we have seen so far.

EET&D: Is there anything we can we do to stave off these emerging threats to reliability and sustainability?

Sanderford: Well, unless we take some fairly aggressive steps now, reliability is going to suffer. Let’s face it we’ve already seen blackouts even before the grid infrastructure utilization was being pushed as hard as it is today, or especially as it will be in the future. Utilities have had a reputation for being slow moving, largely introspective organizations that do not embrace change easily – especially not radical change. However, we are seeing signs that this posture is changing. In fact, most of the larger utilities we interact with are already working with consultants and/or internal teams to evaluate costs, benefits and accompanying risks before taking any material steps toward SGI transformation.

EET&D: So to sum this up, what can we expect in the way of a timeline for all of this to be put into place?

Yeates: Realistically, I think we can safely say that there’s still a very long road ahead; most likely decades rather than years. It will be simultaneously challenging and exciting to see how it all unfolds, but I also believe that we have the talent and technology required to meet those challenge head on – something we do around here every single day. And I’m personally excited – as I’m sure Britton is as well – to be a vital part of the solutions that will help make the Smart Grid a reality.