By smartgrider In Advanced Metering Infrastructure, Case study Posted 2014-07-12

CALIFORNIA

USA California

4 California AMI deployments

Overall AMI deployment across the USA is expanding, many with pilots in behind the meter technologies such as in-home displays and customer web portals, and many with dynamic pricing schemes. In 2011 the US Energy Information Administration reported over 37 million AMI meters, and over 45 million AMR meters in operation. Over 10.5 million of those AMI meters were in California, with another 0.5 million AMR meters in operation. California in particular has accelerated efforts through policy and programming since 2006, for smart grid investments supportive of conservation and renewable energy integration. As a result, a lot of regulatory and implementation issues have been dealt with in California first, before other states. Most notably, California has developed best practices for managing data and privacy issues in particular, and also managing deployment with alternative options such as opt-out availability. Four California utility experiences are presented in this case to illustrate the deployment of AMI under different smart grid drivers, and with different approaches: Sacramento Municipal Utility District (SMUD), Glendale Water and Power (GWP), Burbank Water and Power (BWP) and San Diego Gas and Electric (SDG&E). These four utilities serve about 2.2 million of the 15 million customers in California.

Each of these deployments includes smart meters and the associated communications networks, remote reading and control, data management systems, web portal customer interaction, and some form of dynamic pricing. They differ in size or scale, pricing scheme and in behind-the-meter capabilities such as in-home displays. A summary of the project descriptions are shown in Table 4 under Current Status & Results.

 

Objectives & Benefits

California smart grid policy is enacted in part through the California Public Utilities Commission (CPUC) which regulates the three large investor-owned utilities (IOUs). San Diego Gas & Electric is one of them with almost 1.4 million customers. While the CPUC does not have regulatory authority over the municipal utilities, such as the three outlined in this case, its regulation does set the tone across California for smart grid approaches and serves to identify best practices. When authorizing rate recovery from 77% of the California customers for AMI, the CPUC recognized the following benefits to customers, the electricity system and the state from smart meters:

• Allows for faster outage detection and restoration of service
• Provides customers with greater control over their electricity use when coupled with time-based rates
• Allows customer to make informed decisions by providing highly detailed information
• Helps the environment by reducing the need to build power plants, or avoiding the use of older, less efficient power plants as customers lower their electric demand
• Increases privacy because electricity usage information can be relayed automatically to the utility for billing purposes without on-site visits by a utility

While each of these benefits are written more from the perspective of the customer, AMI systems also generate significant operational benefits as described below. Together these customer and system benefits served to create the business case for AMI investment.

Looking at the four utilities presented in this case, each had a unique set of objectives. For example, BWP, responsible for water and power services, wanted a mesh network across the whole city. SMUD and SDG&E were driven more by demand for the integration of renewable generation. That notwithstanding, drivers common to each of their AMI deployments can be summarized as:

1. Operational efficiency and reliability
2. Customer satisfaction and engagement with more services

The initial focus was primarily on achieving system functionality. As will be discussed later in this case, however, the utility experience with AMI implementation in each of these deployments led to greater focus on customer satisfaction and engagement.

 

Building the Business Case & Measuring Success

The CPUC recognized smart meters as a key step toward creating a smart grid in California. By enabling greater visibility of grid performance, AMI is seen to contribute to greater reliability and resilience to outages and other problems on the grid. AMI can also allow utilities to meet various operational and customer satisfaction objectives, including conservation, customer control, environmental performance, customer service and privacy.

The technical systems underlying an exemplary AMI implementation are illustrated in Figure 14, which shows the BWP integration schematic. In the BWP deployment, the Meter Data Management System (MDMS) interconnects to 5 other operation and information systems. This tight integration supports a wide range of applications, which in turn supports the business case for the project. As BWP, SMUD, and GWP are municipal utilities, their respective city councils reviewed and approved their smart grid deployments, while the CPUC performed this role in the case of SDG&E.

Figure 14 : BWP Smart Grid Key Operations and Information Systems

Burbank Water & Power’s Meter Data Management System (MDMS) is interconnected with its other operation and information systems. (Image source: B. Hamer, BWP)

The intended functionalities enabled by AMI are evident in the metrics designed to measure AMI functionality and progress toward achieving the stated benefits. The CPUC mandated in April 2012 that AMI metrics be reported by the IOUs each year, including: Number of smart meter malfunctions where customer electric service is disrupted;

• Number of utility owned smart meters supporting consumer devices with Home Area Network (HAN) or comparable consumer energy monitoring or measurement devices registered with the utility;
• Number of escalated customer complaints related to the accuracy, functioning, or installation of smart meters or the functioning of a utility administered HAN with registered consumer devices;
• Number of utility owned smart meters replaced annually before the end of their expected useful life;
• Number and percentage of customers with smart meters using a utility administered Internet or a web-based portal to access energy usage information or to enrol in utility energy information programs;
• Number of customers enrolled in time-variant electric vehicle tariffs;
• System-wide and total number of minutes per year of sustained outage per customer served; and,
• Total annual electricity deliveries from customer-owned or operated, grid-connected distributed generation facilities.

Half of these metrics focus on the delivery of services to customers, while the other half measure customer response to the delivery of services. This speaks to the challenge of making a business case centred only on customer value. While customer benefits are an important aspect to make the business case, these need to be coupled with operational benefits. Because a business case dependent on customer behaviour is not entirely predictable, the command and control and data management functionalities shown in Figure 14 bolster the value proposition for utilities. Thus, outside of these customer-focused metrics, operational savings are measured against the cost of deploying AMI such as reduced number of truck-rolls from AMR and outage management, and deferred asset investment based on more detailed information about demand profiles.

 

Current Status & Results

A summary of the drivers, current status and results of each of the four utility deployments of AMI are presented here. They are also outlined in Table 4.

Table 4 : California AMI Project Details

 

Sacramento Municipal Utility District (SMUD)

As the second largest deployment presented in this case, SMUD’s experience with AMI is interesting in that it includes the largest of the US Department of Energy funded consumer behaviour studies, with approximately 57,000 customers participating. In a randomized control trial SMUD is studying the effect of different rate combinations, in-home displays and mandatory, opt-in and opt-out deployment approaches on overall demand reduction. It is expected that these will be the largest most rigorous tests on how different technologies affect consumer behaviour, with results available in late 2013 or early 2014.

SMUD’s AMI deployment is also part of a solar neighbourhood pilot, demonstrating some of the best communications between solar PV inverters and the meters. The PV integration project is described in the Future Steps section.

Drivers

•  Operational efficiencies (reduced truck rolls and O&M costs, meter reading, deferred investment)
• Improved reliability and reduced line losses
• Solar PV integration

Current Status

• ~670,000 meters deployed with the network and billing systems in full operation
• Opt-out: $127 initial fee, and $14 per month recurring fee.

Complementary Technologies, Systems, and Processes 

• Majority of Distribution Automation Systems installed, and will be fully operational summer 2014
• Solar PV and energy storage for smart grids with inverter ? meter communication

 

Glendale Water and Power (GWP)

When GWP was planning for its AMI roll-out they realized that it would be the beginning of a much greater transition for the utility and the customers they serve. GWP embraced the opportunity with two years of internal preparation before launch. As one executive remarked, “For 100 years the utility worked in silos – customer service, technical, etc. It took 6 months to get people from different silos to come to meetings.” During this time they paid careful attention to the impacts of an AMI program on unionized staff, and developed a plan where some work duties were changed, some were phased out and others were phased in. When it finally came time to launch, GWP adopted a “down home” approach to engaging their customers. Staff from the utility became a fixture in the park or in places around the community every week for citizens to come out and learn about smart meters prior to roll-out. They experienced virtually no push-back as a result (only about 0.25%), which is notable because there had already been a fair amount of negative response in other California service territories around that time.

Drivers 

• Operational efficiency and loss prevention
• New customer services
• Planning for future systems

Current Status 

• ~85,000 meters installed
• Out of 40,000 residential customers, ~100 on delay list

Complementary Technologies, Systems, and Processes 

• Energy storage for peak shifting (162 thermal storage units ≈ 1.27 MW capacity)

 

Burbank Water and Power (BWP)

As was illustrated in Figure 14, BWP developed a plan that integrated its AMI within a plan for the administration, data management and control systems. Theirs is one of the few deployments with a mesh network backbone that covers the entire city. The resilience of this network will be compared with the hub and spoke type communications backbones adopted by other utilities.
Committed to their second driver of customer empowerment, BWP partnered with Opower, a company focused on customer-facing solutions and products, to engage customers in conservation and demand management programs. BWP’s “Smart Choice” program tests varying ways to present energy use information to customers on their bills (and via a web portal) in order to encourage demand shifting or conservation.

Drivers 

• Modernizing the business, communications systems, and delivery systems
• Empowering customers

Current Status 

• Cisco powered fiber optic network with a Trilliant / General Electric AMI meter system and eMeter Meter Data Management System
• Opt-out: $175 initial fee, and recurring $10 per month. Opt-out meters are digital meters with the radio modules removed

Complementary Technologies, Systems, and Processes 

• Tropos city-wide wireless mesh network ? Thermal energy storage for peak shifting (19 Ice Bear rooftop thermal storage units at city and commercial and industrial sites); goal of 285 units
• 2MW of controllable demand
• 11 controllable plug-in hybrid electric vehicle (PHEV) charging points

 

San Diego Gas & Electric (SDG&E)

SDG&E stands out as having an outstanding AMI outreach and deployment methodology. Its “90/60/30” day communications plan prior to each community deployment now serves as a best practice adopted by many other utilities across the USA.

One of the early implementers, SDG&E had almost all of their meters deployed before federal stimulus funding was offered for smart meter deployment. This made them the first utility in the USA to cover their entire service territory with gas and electric smart meters. Taking the lead can also mean running into a lot of unanticipated challenges, but SDG&E also did two years of deep design work prior to doing any deployment. Customers were even involved in a co-design process prior to the first AMI deployment in 2009. Consistent with their commitment to customer engagement, SDG&E has also fully implemented the Green Button data platform, which is described later in the Future Steps section. Unsurprisingly, in California and the broader USA, SDG&E is known as a leader in AMI and smart grid for customer engagement.

Drivers 

• Early drivers (pre-2009): safety, reliability and efficiency
• Current drivers: leveraging AMI for distributed generation and customer energy efficiency

Current Status 

• Fully implemented Green Button data platform
• High satisfaction: 0.016% claims & complaints rate; 0.05% of customers joined the “delay list”
• Opt-out program in place (initial $75 fee + monthly $10 charge. Low-income customers may opt out at reduced rates: initial $10 fee + monthly $5 charge.)

Complementary Technologies, Systems, and Processes 

• 57,000 programmable controllable thermostats

 

Lessons Learned & Best Practices

Customer Engagement

A lot of the early messaging with smart meter deployment was around conservation and savings. Since then, the messaging has become more tempered to allow for fluctuations in customer bills for unrelated reasons. For example, weather-related billing spikes following the installation of smart meters, can incorrectly lead customers to attribute the billing spike to smart meters. This serves as a reminder that unrelated (e.g. weather) events can impact customer perception of AMI benefits.

In this light, one lesson learned is the relationship between customer engagement and operational benefits. Specifically, utilities that aim to achieve operational benefits that are evident the consumer, such as faster restoration times, find better value in their investments.

Customer communication has also become more sophisticated by using different methods appropriate to reaching different customer segments. SDG&E’s 90/60/30 plan is a good example of how to employ frequent messaging with different channels to facilitate a positive customer experience.
The language has become more direct, avoiding jargon, to help customers understand new systems and realize their benefits. Addressing customer privacy concerns early, with fair, transparent and progressive privacy principles, is an example of how to avoid potential customer opposition.
The intended customer benefits become even more transparent when they’re measured and reported on by the utility to their customers.

Finally, for those customers with concerns that can’t be resolved through outreach and engagement, opt-out provisions within the AMI deployment plan are increasingly a standard component adopted by utilities. Regulatory authorities have recognized the value of customer choice in this regard.

Organizational Change

Utilities have recognized that AMI deployment is not simply about installing new technologies. It marks a shift in the function of the grid, the services the utilities provide, and a shift in the customer-utility relationship.
All of this stimulates organizational change for the utility. The most successful utilities in this respect created a strategy for internal utility change management. This strategy included details such as investing in staff training for customer service and field personnel to be well informed about the full range of smart grid and AMI issues and benefits.

System Integration

On paper the fully integrated system design elegant. However a key challenge remains with tying together numerous software packaged so that billing, monitoring and SCADA all work in unison.In this respect IT & integration costs represent a non-trivial and ongoing expense. Also, a key part of utility change management is involving IT staff early on as an integral part of the planning team.

Business Case

The impact of AMI goes far beyond the direct customer benefits of billing. While these benefits are important to measure, it is also important for utilities to recognize the value of complementary technologies, systems and processes that leverage the value of AMI. For example, AMI provides cost effective outage management, grid visibility and solar PV integration capabilities. This is important to consider because while the AMI business model pays for itself in many cases with direct benefits, standing issues of declining utility revenue margins may require a new regulatory paradigm to support ongoing smart grid integration. Performance-based regulation would assign value to the added capabilities that investment in AMI coupled with other smart grid technologies can offer.

 

Future Steps

Looking ahead to emerging technologies enabled by AMI, California utilities are participating in some exciting initiatives. The Green Button initiative and solar neighbourhood pilot are examples of ways that AMI is stimulating innovation for customers to participate with both demand-side and supply-side technologies on smart grids.

Figure 15 : PV and Energy Storage Demonstration at Anatolia Subdivision

 

Sacramento Municipal Utility District solar PV and Storage with AMI pilot in partnership with the National Renewable Energy Laboratory

The solar neighbourhood in SMUD’s network showcases one of the best communications between solar PV inverters and customer smart meters. When a meter gets a signal from the transformer that there is network congestion, it tells the inverter to start feeding the solar electricity into a battery so as to reduce distribution voltage violation. With this capability, smart integration of solar PV can defer overall distribution system upgrades.

The Green Button Initiative, already available for all SGD&E customers, grants customers transparent, timely access to their energy usage data. Customers can download up to 13 months of their personal electricity data in an XML file from the utility website. Customers then can choose to share this data with third parties of their choice, which opens the door for entrepreneurs and customer service companies to offer competitive solutions for customers to manage their energy use.

 

Key Regulations, Legislation & Guidelines

CPUC rulings: http://www.cpuc.ca.gov/PUC/energy/smartgrid.htm

July 2006: California Public Utility Commission (CPUC) approves first major IOU AMI deployment (PG&E)

April 2007: CPUC approves SDG&E smart meter proposal

September 10, 2009: CPUC expedites review process for smart grid funding under Recovery Act

July 2011: CPUC adopts privacy and security rules aligned with “Fair Information Practice” principles

Sept 2011: CPUC mandates a “delay list” for IOUs to allow customers to temporarily delay installation

April 2012: CPUC mandates an “opt-out” provision for SDG&E and Southern California Edison

Oct 2012: CPUC mandates HAN data be made available to consumers

The Green Button Initiative: http://www.greenbuttondata.org/

 

California’s Electricity Grid Policy

California’s policy and regulation has been supportive of smart meter deployment, with a provision for handling customer cases for delaying or opting-out of smart meter installation. The California Public Utilities Commission (CPUC) was the first state regulator to adopt privacy rules for customer smart meter data. The privacy rules are centred on the Fair Information Practice Principles adopted by the Department of Homeland Security. Other states are now following California’s lead.

Furthermore, the CPUC required the 3 major investor-owned utilities in California to create a roadmap for modernizing their infrastructure. Since 2011, these utilities have been submitting 10 year smart grid deployment plans outlining their vision for 1) Smart Customer, 2) Smart Market, and 3) Smart Utility under the California policy framework for smart grid.

California also has aggressive renewable energy goals which drive some of the direction of smart grid strategy. With a goal of 20 GW of renewable energy capacity by 2020 (12 GW DG, 8 GW utility-scale), California has targeted to have renewable energy make up 20% of the supply capacity by 2010, 25% by 2013, and 33% by 2020.

While the drivers for smart grid policy and planning vary from state to state and by utility, investment in smart grid technology throughout the US has been bolstered by national funding. The Smart Grid Investment Grant program, which began in 2009, has funded 50% of projects in the US, 62 of which are AMI projects with smart meters, communications networks, hardware and systems related deployment.

※ Sections of this case taken from California Public Utility Commission documents, DOE sponsored Peer- to-Peer workshop findings, and presentations by each of the 4 utilities.