December 2021 | Point of View

Modern AMI for utilities: Fully deployed solutions

Maximizing the value of AMI requires a continued focus, even after all systems are implemented and endpoints are installed

Modern AMI for utilities: Fully deployed solutions

As we have reflected in previous pieces, completing a full AMI deployment is no small feat. Significant time and effort is required of many utility employees, leaders, and vendor teams to successfully transform how the utility operates and improve service to customers. However, there is no rest for the weary! It is crucial for utilities who have fully deployed AMI to remain focused on delivering benefits from AMI even after all systems are implemented and endpoints are installed. Successful execution is inclusive of not only deployment, but sustainment of the network and program. As the most successful AMI transformations have shown, full deployment is only the beginning of the journey. 

Benefits realization ideally begins during deployment, through thoughtful definition and tracking of benefit KPIs, as well as proactive engagement across the organization and with regulators and customers to maximize and articulate AMI’s impact. Following deployment, utilities must build upon that foundation to refine benefits realization for core business case targets, identify more advanced opportunities for AMI value creation, and clearly report across stakeholder groups.  

At the core of realizing and articulating the benefits of AMI are key analytics leveraging AMI data. 

The concept of data analytics continues to be at the forefront of major utility strategic initiatives as more and more smart devices are deployed, leading utility operations to become more complex and utility-customer interactions to become increasingly dynamic and digital. Utilities across the country find themselves in very different positions with respect to analytics maturity, and not all organizations have the same business challenges that analytics can help solve. With that in mind, utilities have an opportunity to define or refine their analytics strategy, governance model, suite of tools, and supporting architectures.  

Deliver on core benefits 

Core to most recent AMI business cases is a set of common, AMI-enabled operational, customer, and societal benefits. These benefits are generally viewed as table stakes and focus on costs saved via: 

Automating...

operational and meter reading processes <br />

Providing...

greater usage data and programming for customers

Reducing...

greenhouse gas emissions <br />

Improving...

safety and reliability

While they may seem more straightforward, successful utilities do not underestimate the importance of establishing key frameworks to ensure stated benefit targets are being achieved. 

From an operational benefits standpoint, avoided meter reading and meter servicing costs, improved outage or leak response time, reduced billing exceptions, reduced bad debt and theft, and reduced lost and unaccounted for fuel or water all fall into this category of core benefits.  

To properly track and report the impact AMI is having on these metrics, it is crucial for utilities to establish baselines for pre-, mid-, and post-deployment performance across each area. Additionally, utilities must work to connect data streams that otherwise may be siloed.  

As an example, tracking the number of remote disconnects completed in coordination with identifying trends in consumption on inactive meters helps a utility tell a clear story for how AMI is helping drive down related operational expenses. For all of these key operational metrics, it is critical that utilities define a clear governance model (including ownership and responsibility for KPI performance), establish effective tools for reporting across internal teams, and develop a strategy for reporting on progress to external stakeholders. It is important to remember that while these benefits are often framed as “utility” or “operational” benefits, they have a positive impact on customers as well. Downward customer rate pressure will result from a reduction in operating expenses, including the elimination or significant reduction of costs previously socialized to all customers. 

Core customer benefits included in AMI business cases typically focus on customer savings driven by lower overall usage, peak-time savings programs, and time-varying rates, as well as the value to customers of reliability improvements.  

To accurately measure changes from a pre-AMI world, utilities must develop customer profiling, track usage of customer portal data and participation in new rates or programs, and identify key drivers behind real changes in customer usage.   

Proactive channels for customer education and engagement are critical for driving the behavioral changes required to deliver these customer benefits. Clear and detailed usage data graphics can be used to show customers how their usage compares to peers and how they can potentially save on their bill. Timely notifications for peak-time savings, time-varying rate events, and conservation thresholds or water use restrictions help customers stay informed on when their actions can help reduce peak load, ultimately saving customers money. Consistent with all external benefit reporting, utilities must be thoughtful and proactive in how they report on these customer benefits to customers and regulators to prove the value of AMI beyond its core operational benefits. 

Similar to customer benefits of AMI, societal benefits are becoming increasingly important for utilities to focus on as part of the core business case for AMI beyond operational benefits. New focus and attention on Environmental, Social, and Governance (ESG) standards and expectations create an elevated focus and value associated with these types of benefits.  Reduced greenhouse gas emissions from fewer truck rolls and lower electricity and natural gas consumption, as well as reduced water usage in dryer regions, are key to utilities’ growing mission to contribute positively to broad sustainability targets.  

In alignment with other utility sustainability reporting, utilities should develop an effective framework as part of their AMI deployment to translate the number of reduced truck rolls into avoided emissions and develop metrics for reduced energy and water usage driven by customer tools and programs. 

Utilize AMI for Advanced Benefits 

Beyond the core operational, customer, and societal benefits utilities set out to deliver through AMI, are myriad advanced benefits that leverage the foundational investment of AMI and often tie into other utility investments or programs.  

These additional benefits can come in the form of improved operational insights across a utility’s system, advanced distribution management capabilities, and industry-leading enhancements to customer experience and self-service.

In alignment with core benefit realization, sound frameworks for data governance and management, effective tools for analyzing and acting on data, and a clear strategy for reporting on benefit KPIs internally and externally all play into a utility fully realizing the more advanced benefits enabled by AMI. 

As utilities seek to operate and maintain an evolving grid or pipeline network, readily available insights into the performance of the system and individual assets have become increasingly valuable and in certain cases critical. AMI data paired with information flowing from other smart endpoints can enable utilities to quickly identify potential safety events and even develop preventive maintenance strategies through predictive analytics. Additionally, as utilities weigh major decisions to replace or build out new infrastructure, AMI data can help improve capacity planning and equipment right-sizing prior to capital intensive investments. Measuring and reporting on these sorts of advanced operational benefits can be challenging, given that there may not be quantified baselines to compare to and AMI data is likely just one piece of a multifaceted analytics approach. That said, utilities who are building out the capabilities to drive these benefits have the opportunity to collaborate with regulators and industry groups to define the right way to quantify the impact of AMI and other distributed technologies on operations and planning. 

Similarly to improving operational insights, AMI can enable the more advanced control utilities need to manage the continuously evolving distribution system, providing greater safety and reliability throughout. These more advanced distribution management capabilities are generally not delivered through AMI deployments in isolation; rather, they require continued focus on the part of the utility to leverage AMI and other smart sensors and controllers to balance flow across the network. As distributed energy resources (DERs) and electric vehicles (EVs) continue to proliferate, AMI will be central to utilities’ efforts to balance these flexible sources of generation and load to maintain reliability and drive toward a more sustainable grid.  

AMI paired with conservation voltage reduction (CVR), volt-VAR optimization (VVO), and demand response (DR) can help utilities reduce peak system load and improve overall system efficiency. For natural gas and water utilities, AMI data paired with digital pressure, corrosion, and methane monitoring sensors can enable near real-time visibility and control to prevent and mitigate potential safety events throughout the distribution network. Similarly, water utilities can leverage district metered areas (DMAs) to identify system water loss. Quantifying the number of DER and EV assets being managed via AMI, as well as the reduction in peak demand through CVR, VVO, and DR, all play into a utility’s full benefits realization from AMI. Additionally, natural gas and water utilities can articulate the role of AMI in managing events in their system safely and digitally, particularly as more AMI vendors release fully integrated meters with automatic shutoff capabilities for high pressure, temperature, boil notice, and other unsafe condition events.  

Building upon the advanced distribution management capabilities unlocked by AMI, the continued proliferation of customer-sited DERs and EVs also presents an opportunity for utilities to further improve customer experience. Specifically, AMI enables utilities to provide more flexible net metering, time-varying rate, and DR programs for customers who have chosen to install DERs and/or EV chargers, thus increasing overall customer experience and agency. Electric, natural gas, and water utilities are also able to roll out more flexible and customer-friendly billing programs, such as custom bill date selection and prepaid billing, as well as more targeted and effective resource efficiency programming.  

Capturing the impacts of these customer programs, specifically as reduced usage and customer savings, are central to articulating the long-term value AMI can deliver to customers in addition to the various operational benefits seen by the utility.

Conclusion 

Depending on when a utility completed their AMI deployment, their key benefits targets, and the maturity of their analytics strategy and capabilities, utilities can adopt different approaches for measuring, reporting, and ultimately delivering value from their AMI investment. Prior to setting down a specific path, utilities must be thoughtful in defining how AMI data can supplement other business and operational data streams, as well as what the right structure is for making this data actionable across the organization. This starts with sound data governance, storage, and processing strategies, and is built upon through data visualization and performance analytics that take a holistic approach to a utility’s data streams.  

Additionally, utilities must have continuous and proactive engagement across the organization and with regulators and customers to better understand how AMI can be leveraged to meet the evolving expectations of all stakeholder groups. Through this ongoing engagement and collaboration, utilities are able to refine and build upon their original business case as more use cases leveraging AMI technology emerge.  
 
With a clear vision for data analytics and valued involvement from regulators and customers, utilities can successfully make the most of their AMI investment for years to come, establishing it as a sustainable and impactful platform for an adaptive future. 

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