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Webster tells us that the definition of intelligence is an ability to learn or understand from experience and to acquire and retain knowledge in order to respond quickly and successfully to a new situation. This definition pretty much characterizes the direction that utilities are taking today as they respond to increasing regulatory pressures by upgrading or adding new systems capable of acquiring and interpreting information.
Today's intelligent utility is all about gathering and processing large amounts of customer and operating data for improved network diagnosis and customer service. As utilities begins to harness the benefits of new smart grid technologies and automated metering infrastructure (AMI), they will be better able to meet the challenges of containing costs and improving service by increasing operational efficiencies. With many enterprise-level systems -- such as geospatial information systems (GIS), customer information systems (CIS) and outage management systems (OMS) -- being implemented to take advantage of this growing availability of information, AMI and smart grid technologies are becoming the principal source for acquiring important operating information on customer energy consumption, outage conditions, voltage and power quality issues, circuit loading and other key characteristics affecting network operation. AMI and the smart grid are increasingly becoming the heart and pulse of the intelligent utility.
The Central Role of AMI
Although the term smart grid covers a wide range of technologies, AMI is often described as the foundation or enabling technology for many technologies comprising the intelligent utility. At the heart of most AMI systems is the use of a two-way standards-based communications system connecting customer meters with the utility's enterprise-level data management systems. Since AMI vendors have been working for years on solutions to communicate with large numbers of smart meters (think millions) for advanced metering purposes, it is not surprising that utilities have begun to look to their AMI solutions to supply the communications infrastructure needed to support operation of remote network devices such as switches, reclosers, line sensors and capacitor banks.
Cooper Power Systems, for example, has signed an agreement with Sensus Metering to license its FlexNet communications technology for transmission and distribution applications. This agreement will permit Cooper to use the FlexNet licensed frequency band for switching operations while the FlexNet system provides the necessary meter data collection functions. And S&C Electric has begun integrating its IntelliTEAM Automatic Restoration System with Silver Spring Networks' Smart Energy Network to provide distributed, fault-tolerant communications over the SSN network to conduct remote switching operations. These and other similar arrangements underscore the potential for utilities to leverage one communications network for combined network operations using open standards and protocols that support a wide range of AMI, distribution network and substation automation functions.
So in a real sense, the many years of AMI development have provided a foundation for what will likely be a much more rapid adoption of smart grid technologies and home area networking solutions that will be needed to improve utility operations and help address projected electric capacity shortages over the next 10 to 15 years. Utilities will increasingly rely on an AMI-supported intelligent utility to accommodate the growing and often conflicting demands of customers, regulators and shareholders for improved reliability, operating efficiency and customer service.
Increased AMI Deployment
If AMI is expected to play such an important role in future smart grid deployment, what is the state of AMI implementation in North America today? Recent research conducted by Sierra Energy Group points to an increasing number of utilities that are studying, piloting or installing AMI solutions. Figure 1, below, provides some insight into the level of AMI penetration that exists in the investor-owned utility (IOU) sector according to a recent survey.
As Figure 1 indicates, fewer than 24 percent of the surveyed IOUs have 50 percent or greater penetration of automated meters. This is partly attributable to the use of multi-year implementation schedules and extensive reliance on pilot deployments as prerequisites for AMI technology selection. In the next few years, this percentage should substantially increase as a number of large, full-system deployments at utilities such as Pacific Gas & Electric, Southern California Edison, Southern Company and Portland General Electric, to name a few, begin to make significant progress with their installation programs.
A common theme among these upcoming large deployments is their choice of AMI vendors such as Sensus, Silver Spring Networks and Itron's OpenWay that offer scalable, interoperable solutions capable of accommodating other smart grid technologies. It is clear from their selections that utilities have become aware of the potential that AMI holds for integration with the smart grid, as they are increasingly making open metering and communications standards an important requirement when preparing vendor RFPs.
Leveraging the capabilities of a single communications network is also being looked at by many utilities as a way to implement new smart grid technologies while spreading out a major component of AMI operating cost across many operating departments. As the number of utilities with less than 10 percent AMI penetration decreases, and as their AMI selections become known, it is likely that the trend toward open standards-based solutions using a common communications network will become even more apparent.
Driving Other Enterprise Solutions
While AMI and smart grid systems are receiving much attention, other enterprise solutions being implemented will continue to require their share of increasingly scarce capital dollars. Sierra Energy Group has conducted extensive research into the relative importance of AMI and smart grid solutions among a wide range of other intelligent utility solutions. AMI/smart grid technologies, which include SCADA, substation and distribution automation, and outage management rank very high among IOU initiatives.
As utilities continue to develop integrated resource plans (IRPs) and grapple with regulations requiring increased use of renewable energy sources, new energy efficiency and demand response programs are being developed that will require significant customer participation to achieve desired results. Many of the enterprise solutions highlighted in the Sierra Energy Group research are designed to improve operational efficiency and increase network reliability. However, AMI is increasingly being seen as a technology that can support energy efficiency and demand response programs by providing the advanced metering and communications necessary for load control and time-differentiated rates.
The interval meter data and two-way communications features provided by AMI systems support a growing number of customer-centric energy management functions that will create a new relationship between utilities and their customers. Home area networks (HAN) that integrate AMI with customer equipment over ZigBee, HomePlug and other network protocols are expected to play a prominent role in reducing energy use in the future. Time-based energy rates, thermostat controls, home energy displays and other energy-saving devices supported through HAN will increase the customers' ability to control their energy consumption while helping utilities to shift peak system demand. Utilities' reliance on these shared benefits to achieve their IRP goals will change the relationship between utilities and their customers forever.
Increasing Customer Role in the Intelligent Utility
The growing importance of customer energy management programs will change the utility/customer relationship by acknowledging a shared responsibility for meeting the nation's energy needs in the future. As states like Ohio, Michigan and California adopt renewable targets that require utilities to become increasingly more reliant on customer participation in these programs is essential and cannot be taken for granted. Therefore, utilities must change their historic go-it-alone culture in favor of a more collaborative management philosophy that recognizes the important role of customers in meeting their energy objectives.
Subscribe to Intelligent Utility magazine today. Intelligent Utility magazine is the new, thought-leading publication on how to successfully deliver information-enabled energy. This article originally appeared in the January/February 2009 issue.
For information on purchasing reprints of this article, contact Tim Tobeck ttobeck@energycentral.com. Copyright 2010 CyberTech, Inc.
Nice overview of the state and progress of AMI technology, particularly the growing recognition of its central role for the future of utility companies.
While interval metering is a basic capability with all AMI meters nowadays being deployed, or being considered for deployment, this feature alone permits just Time-Of-Use billing for customers. But TOU billing in itself does not foster active customer interaction with utility companies. It merely encourages some consumers to load shift to off-peak hours, and the amount of consumer participation depends very strongly on the peak-to-off-peak billing rate ratio i.e. the higher the ratio the more consumers will practice greater load shifting.
To enable more interactive customer participation with utilities hinges on HANs, and demand response programs reaching into homes equipped with smart thermostats, load controls, or future generation smart appliances. This requires that AMI systems and networks be deployed beforehand with the communications capabilities to in-home equipment built into the meters at the factory. Otherwise our utilities face having to replace meters in the field down the road to enable it, which can be very costly. Indeed one of the reasons utilities take many years to deploy AMI throughout their entire network is the need to spread its huge procurement and deployment costs over many years.
Here's another bone to chew on. Even if utilities equip every new smart meter and AMI network with HAN communications capabilities as they deploy them, which some are probably doing with for example Itron AMI systems in California, who will pay for the consumer in-home devices on a very large scale? Surely our utility companies won’t pay for it because HAN equipment for a single residence will cost considerably more than just a single smart meter does.
I predict the public must endure painfully large electricity rate increases down the road to pay for everything, otherwise there will be no wide scale customer interaction with utility companies using HAN devices. And such rate increases will surely cause economic hardship for many. Just ask your local restaurant, or dry cleaning shop, or local auto manufacturing factory, what the impact of doubling or tripling of electricity rates will have on their businesses.
Alternatively, with regulatory reform, utility companies could change their business models and start selling HAN equipment compatible with their smart meters to interested consumers willing to pay for them. Just as CATV and telephone companies do, utilities in this scenario could offer the in-home equipment and data communications though their AMI system to the in-home devices as an added service to any customers willing to purchase them, knowing they could benefit from potentially substantial new savings on their energy bills. Sadly, such reforms to our utility industry don't seem to be of any interest to governments or to regulators as it is not even on their radar screens.
Dick Maclay 3.12.09
How important is a meter connected to a HAN to activating smart appliances? A wireless signal to the meter can also be intercepted by an appliance. A comm signal reaching a meter over the power line will pass through it. What is gained by the extra expense of having the meter do more than keep score on energy usage on an interval basis? So far as I can see just additional cost. The only practical way to achieve smart appliances is a North American (all America/all world?) standard protocol for signals that appliances receive. A real question would seem to be whether appliances should monitor the air or the electric wire for the signals, or do they need to do both to be universally useful?
Bob Amorosi 3.13.09
Dick,
Power line communications can indeed bypass the meter for appliance control to do exactly what you say, easily. It's an old low-cost method of communicating even with electronic meters themselves, and is still in wide use today. Other people are using the old radio pager system to communicate with demand response thermostats already.
The problem with power line communications is that it does not support two-way communications very well. Its protocols and bandwidths are primitive as compared with modern computer networking.. There is also the problem that many power line communications use low frequency carriers that cannot easily jump through local distribution transformers.
Most modern AMI networks on the other hand are two-way systems with advanced IEEE standard networking designs. The state-of-the-art use two-way wireless proprietary expensive radio systems to talk with smart meters, and once in place give utilities a proprietary secure advanced network that reaches the outermost limits of the grid, to every customer.
Actually Dick, AMI manufacturers are making available their proprietary radio technology to some third-parties making in-home devices to communicate directly with an AMI network. In light of an AMI network itself being the AMI radios within the meters, the trouble is most AMI networks are not allowed by design to handle large extra numbers of AMI radio nodes in many customers' homes, other than perhaps one gateway device into the HAN on the AMI network. The HAN must use its own network within the house. Given this limitation, and the fact that AMI radios are relative high power and more expensive, it then becomes lower cost to build that HAN gateway device right into the meter as an optional second radio compatible with the HAN network.
Dick Maclay 3.13.09
Bob, informative comments about the technologies. My question really goes more to the business case for two way communication with appliances. Air conditioners, refrigerators, even washers and dryers, can respond to a broadcast signal about system conditions. The feedback to the grid is that the customer's energy consumption for that period did go down. As for programming an appropriate response by appliances to signals they receive it may work fine just to have a couple of buttons on each appliance to set priorities and override them when desired. Or let them be accessed by the laptop which already has a wireless protocol. If AMI protocols do not allow a broadcast mode perhaps we should be considering a revision to include it.
Perhaps there is a case for two way communications by appliances, but I have not seen it made. We definitely have the cart before the horse here designing infrastructure technologies without first discussing the objectives and what technology characteristics are required to reach them.
Bob Amorosi 3.18.09
Dick,
I understand your points, there is always the cost benefit arguments to be made. Future proofing a system design, especially one that involves many other consumer product industries besides our utility industry, and one that involves consumer lifestyle behaviors, is very difficult.
A big problem is that even with defined objectives, they can change over time, and once deployed into the field, it takes years or decades to replace hardware, especially if it depends on the utility industry to do it, or if it depends on consumers having to buy expensive appliances long before the end of their useful service life.
Consumer markets in general on the other hand are accustomed to frequent hardware changes in other consumer high-tech products. People are often willing to pay to replace old devices with new ones that have many new features, often whether they need them or not. So the trick in my view is to get interested consumers to buy into this stuff with their wallets, and not burden the utility industry with it to try and make it a universal system for every customer all at once. One way is to make more of the features inherent in software which can be updated more easily in the future.
Two-way communications between smart appliances and the utility company is probably not necessary as you imply. The only case I can think of is if the utility wanted a confirmation signal sent back to it that a given load was shed after issuing a price change or other targeted demand response request. However two-way might be useful between appliances and their home-owners, to monitor and track how much power and energy each appliance is consuming, both presently and over time.
Bob Amorosi 3.18.09
By the way, most modern networking protocols that require any data transfer for control use bi-directional communications for reliability. Zigbee is a good example. However some simple on-off control can get away with one-way, like your garage door openers for example, but even these require coding for reliability and security.
Len Gould 3.19.09
Dick: "The feedback to the grid is that the customer's energy consumption for that period did go down." -- That level of feedback may be the problem. Once utilities get (if ever) to the point of paying full value per kw for critical demand response especially during high-price peak periods, it becomes critical to know a) is that particular appliance actually running when I ask it to shut down? b) how much did it actually reduce its load due to my request? This sort of thing is only possible with well-thought-out well-designed high-performance communications systems, which are really not more expensive than the usless systems, just need smarter planning, standards setting etc.
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