Utilities should consider total costs when choosing AMI

Utilities can avoid limiting future ambitions by taking a more holistic view of their AMI adoptions.
Published: Fri 26 Aug 2016

When it comes to selecting advanced metering and communications networks, utilities should be evaluating the total cost of ownership rather than focus on the initial implementation costs.

This is according to a white paper put together by Aclara, a supplier of smart infrastructure technologies to water, gas and electric utilities globally. The white paper, "Evaluating Total Cost of Ownership Models When Choosing Advanced Metering and Communications Networks" is based on interviews as well as regulatory filings and other publically available information.

Taking a macro view of AMI adoption

The research indicates that the choice of the meter communications network has significant impact on the total cost of ownership. It shows that point-to-multipoint networks may offer the lowest total cost when compared with the alternatives of mesh, drive-by and manual networks. In addition, the meter communications network chosen by a utility impacts future capabilities, with point-to-multipoint networks offering a robust platform for additional smart infrastructure solutions such as load control and distributed automation that enable utilities to optimize networks and enhance the level of service they provide to customers.

Kumi Premathilake, Senior Vice President Advanced Metering Infrastructure says that taking a long-term, macro view of both costs and the robustness of the communications network are key points for utilities to consider when choosing an AMI solution. “One can assess the true costs of an AMI network only by evaluating the total cost of ownership over the network’s lifetime. While not insignificant, implementation costs over the first couple of years paint only part of the picture, whereas the network configuration plays the major role in the lifetime operating costs that the utility needs to assess.”

The white paper discusses comparative capital and operating expenditures of point-to-multipoint, wireless mesh, drive-by and manual read network configurations. A model illustrating total cost of ownership over a two-year deployment period followed by a 15-year lifespan shows that point-to-multipoint networks have the lowest cost of the four configurations, largely because of the dramatic reduction in operating costs, which are less than half that of manual networks and significantly less than operating costs of mesh or drive-by networks.

The effect of network selection

The Wired Group, which prepared the white paper,found that, according to utilities, one differentiator between mesh and point-to-point network configurations was that mesh networks must re-create pathways to access points after an electric outage. This process can require a few hours to a few days to complete once electric service is restored, during which time the meters which have yet to reconnect with an access point are unreachable.

This is an important consideration because a major impact on utility costs and operations involves service orders, such as disconnects and reconnects for service changes, which must be carried out manually for meters that are temporarily unreachable. Effects can be seen in service order completion rates, which are generally lower for utilities using mesh rather than point-to-multipoint networks.

In addition, manual service orders increase when manual reconfigurations and/or field device adjustments must be made to reconnect some meters to mesh access points after pathways are automatically reconnected after outages.

Some utilities using mesh networks also report that meter pathways that had been purposely established by network engineers – for example, to balance access point data loading – become unraveled as the meters automatically re-establish pathways after an outage.

Network selection and outage management

The white paper suggests that point-to-multipoint networks may integrate outage reports from meters into their outage management systems (OMSs) better than utilities using mesh networks. One-on-one interviews indicate that point-to-multipoint networks are less likely to become overwhelmed, and fail, when thousands of meters report an outage simultaneously, than mesh networks.

Though bandwidth increases in networks are possible with increased capital investment, this could be the reason why utilities with point-to-multipoint networks are more likely than others to utilize their meters’ “last gasp” capabilities in their outage management systems.

The implications for customers and utilities go far beyond outages. There are several situations in which a utility or third-party energy manager might want to communicate with thousands of meters simultaneously. Utilities using meters as gateways to customer energy management systems might want to communicate instructions to loads through meters during demand response events, while third-party energy managers might want to access thousands of customers’ usage data in near-real time to determine which load management actions to take during high cost periods. Networks incapable of handling thousands of simultaneous communications could not complete these functions.

The researchers found that utilities using point-to-multipoint networks may be more likely to use those networks to communicate with non-meter distribution devices, such as switches, reclosers, capacitor banks, sensors and other devices, than utilities using mesh. 

Meter data and distribution automation

The research also found that utilities using point-to-multipoint networks were more likely than those using other types of fixed networks to use meter data in distribution automation applications such as integrated Volt/VAR control. When in use, most integrated Volt/VAR control applications require continuous, near real-time data feeds on voltage and power factor conditions from thousands of distribution grid endpoints.

Interviews found that utilities with mesh networks often use line sensors rather than meters to provide voltage and power factor data, and use distinctly separate distribution communications networks to monitor these devices.

Reaching hard-to-reach meters

Meters in rural areas, as well as meters located below ground or deep within large structures, present challenges to most meter communications networks. However Wired Group researchers found these issues were most frequently mentioned by utilities that had deployed mesh networks. While utilities described addressing these issues through the use of meter data repeaters and range extenders, such solutions entail greater initial costs.

Such solutions also represent additional points of potential failure that could conceivably impact network reliability, though adverse impact on network reliability was not detected in reported meter read success rates.

Understanding future outcomes

Ana Domingues, Head of Global Portfolio, Utilities Industry at CGI told Engerati in a recent interview that utilities should take a more holistic approach to smart technology deployments if they want to achieve many different value drivers. .” [A Holistic Approach Will Maximise The Utility Business Potential]

She said: “While roadmaps vary across organisations and countries, the driver for business process reorganisation is an end-to-end business process perspective and an understanding of outcomes to be achieved. By looking at end-to-end processes, you can start looking incrementally at what business processes could provide more return on investment if they were changed to achieve certain business outcomes. This would be part of a long-term business approach which would consider as well the way a network Utility is organized. Utilities must not let their current projects, shaped by more short term value drivers, limit future ambitions.”

For more insight into how to make better adoption and deployment decisions,  and achieving a sustainable operational grid excellence, join our upcoming webinar Project case study - Scoping the perfect End to End smart meter roll out. This webinar is part of our "Smart Metering" In Focus track on Engerati.


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