Are You Prepared for the Last War?
By Jim Cunningham, Williams Telemetry
A historian once said the greatest mistake made by many generals is they prepare to fight the last war. Can the same be said about today`s automated meter reading (AMR) vendors? Are they preparing you to fight on the new battlefield of deregulation?
Since deregulation will increase the need for information, AMR should be ready to profit by the situation and consequently benefit the merchant or distributor. But reality differs. Today`s AMR vendors don`t collect data to effectively meet the demands of deregulation. If you are considering employing an existing AMR technology, make sure you are prepare to fight. You must be armed with timely information.
Energy usage data has never held great value in the regulated environment. It was needed only for billing purposes. As a result, AMR vendors designed their technology based on this lower value. However, with deregulation, information is far more important than it used to be. New telemetry companies will emerge to offer services different from today`s AMR vendors. They will not build data-gathering networks; they will use existing national telecommunications systems and also will focus on building customer premise equipment. This two-pronged attack will create a cost-effective weapon for monitoring energy usage and will act as a platform for launching many different energy- and information-based applications, including meter reading.
The new telemetry service also will offer energy providers with revenue stream opportunities. While today`s AMR is primarily concerned with reducing billing costs, the new telemetry service will focus on managing the national sales and delivery process to customers as efficiently as possible.
The new telemetry companies will be ready to provide timely consumption data to all parties involved in energy transactions, on an integrated national basis and in a just-in-time format to serve the needs of national merchants, distributors and customers. Consequently, the focus will shift from simple data gathering to data compilation and reporting. Timeliness of data will be a critical factor in how suppliers survive deregulation. The new telemetry service will track daily or even hourly load-scheduling and product-balancing cycles.
In addition, merchants and distributors will need data on a regional and national basis. The new telemetry service will go beyond today`s isolated and localized data-gathering coverage to offer expanded data processing and dissemination and support nationally integrated billing systems. While providing just-in-time information and aggregate and supply management information for all parties involved, telemetry companies will also create a new revenue stream for the energy provider. They`ll employ an open-architecture on their customer premise equipment and open the door for merchants and vendors to provide value-added services such as security monitoring, Internet mail, bill paying, banking, etc.
Distributors and merchants also will be able to sell data to other parties involved in the energy transaction. Like the value-added services, the telemetry company will manage and bill for the dissemination of the data in the name of the energy provider and share the revenue. And as customers gain the freedom to pick and choose whom they want to deliver their energy, these services will become essential.
In the open marketplace, commercial energy users will seek ways to become pro-actively involved in their own energy management. They will demand tools to help them choose the best energy supplier. They will want to see aggregated usage and will want to buy and manage on a national basis, aggregated peak demand.
Their large-scale, nationally accessible, database and Internet servers offer merchants, distributors and customers a means to manage energy supply on a national basis and reduce energy costs. Customers will be able to “go on-line” to see and analyze their monthly bills and play “what if” scenarios with various billing plans. The options available for gathering and using meter data are going to expand greatly in the next decade. The new telemetry companies will prepare everyone involved in the energy transaction to fight the information war on the deregulated battlefield.
Note: The content of this article is strictly the opinion of the author. It does not represent the opinion of Williams and its affiliates or PennWell and Utility Automation.
Jim Cunningham is vice president of operations and technology for Williams Telemetry, a business unit of Williams. With more than 25 years of experience in technology-related industries, he has worked as an independent consultant to venture capitalists, investors and companies, defining start-up strategies and high-technology markets, products and software for energy, medical and communications industries.