Beyond the Meter: MDM Branches Out

By F. Garrett Johnston and Ron Chebra, KEMA Inc.

Utilities that are exploring, or developing strategies for deploying, advanced metering infrastructure (AMI) systems will likely find themselves evaluating the potential benefits of investing in a robust meter data management (MDM) system. To truly maximize a large-scale, fixed network investment, many AMI program managers understand this need and are ready to invest millions of dollars in MDM systems.

As a crucial first step in the AMI roadmap, several utilities are developing a process to thoroughly evaluate an MDM system, including the need to involve stakeholders from across the enterprise. This is critical because maximum value and improved return-on-investment (ROI) can be achieved when all departments accept the concept of an enterprise-integrated MDM system and allocate reasonable resources to ensure benefits are realized from increased data access and utilization.

Indeed, MDM is about much more than metering. It is the core of many operational systems and therefore is the key to harvesting value from those systems.

Developing an MDM strategy requires that utilities address the following concerns:

  • Process change impacts,
  • Multi-departmental acceptance,
  • System and resource requirements (both human and otherwise),
  • Effective MDM system features and functionality, and
  • MDM resource examples and leading practices.

Selling the Value of Meter Data

Some utilities are fortunate enough to have senior executive sponsorship embracing and supporting the AMI vision. That type of support can foster improved cooperation and collaboration among various business units, leading to the development of a holistic view and full realization of AMI’s true value.

More typically, however, AMI program managers must “sell” other business unit leaders on the value that meter data can bring to their organization. This task is even more challenging when there is little or no historical track record of how each unit can leverage timelier meter data. Even when other business unit leaders can envision tangible benefits, they can be reluctant in allocating business unit resources to the AMI effort. This is especially true where key benefits and needs are channeled to another operating unit with its own requirements, such as fulfillment of policy guidelines as set forth through section 1252 of the Energy Policy Act (EPAct) of 2005.

All these factors can make it daunting to establish an effective capital-spending plan that crosses divisional boundaries. Significant assistance is needed to develop support information for the business case and key assumptions about how future utility information systems will enable improvements and defer operational expenditures. As early as possible, all potentially impacted stakeholders need to be involved. Several post-deployment success stories clearly demonstrate that other departments will seek greater uses for, and will gain more management control of, timely access to consumption data, power quality information, outage information and interval read data. Still, getting from concept to reality can require tact and persistence.

Many utilities often extend interval consumption data to the engineering design departments so that load profiling can be accomplished more frequently and without specialized profiling equipment. Running real-time analysis of any service area can dramatically streamline asset planning. Additionally, when designers have access to near real-time data, they can perform various ad-hoc evaluations, giving them critical feedback and trends that enable their department to operate more efficiently. But placing a value on something new may be challenging and more speculation than science.

As shown in Figure 1 (pg. 16), the opportunity map of possible AMI-use benefits is a classic case study in utility operating efficiencies. While automatic meter reading (AMR) opens the door to many potential uses, AMI potentially offers more pervasive operational improvements.

Click here to enlarge image

For example, for repair/dispatch, the value of discrete information from multiple points enables greater accuracy in work planning and management. And while AMR can streamline the traditional tariff billing process, AMI can further facilitate customized billing packages, including time-of-use, critical peak pricing and other unique offerings. Even intelligence-based marketing programs can be formulated based on interval data, profile information and rate structures that leverage this data. With near-real time information, customer care can be restructured from a reactive mode (why is my bill so high?) to more of a proactive mode (your consumption so far is trending toward a record usage; are you aware of what you are consuming?).

Effective back-office and enterprise-level integration is critical. With emerging standards, optimized information flows and process redesign, the value of meter data within the total utility can be more tangibly realized. This can create a framework for the utility of the future founded on information sharing and use.

A flexible architecture is essential to ensure all possible departments can utilize the data now and in the future. To truly leverage MDM and other relevant automation solutions, utility executives will face the need to plan for the process changes early in the development roadmap. The first step-even as your team evaluates various technologies-is to begin assessing new processes.

To begin this process, a utility must establish how each department will receive information. A central data warehouse is one architectural design that offers good benefits. With this approach, the MDM receives, processes and relays data from each AMR or AMI system, subsequently passing it into a reporting and data-accessible system for appropriate formatting and use by each respective utility stakeholder.

Among the features/components MDM systems can have are:

  • Scalability,
  • VEE (Validation, Editing and Estimation),
  • Industry standard estimations,
  • Error handling,
  • Auditing,
  • Aggregation,
  • Reporting,
  • Revenue exceptions, and
  • Version tracking (including the source and reason for a change and whether it’s manual or automatic).

Utilities will often make strategic choices when deciding what type of data their MDM system will handle. For example, with the increased prevalence of large-scale AMI installations, tracking physical distribution and location of new meters has become more critical. Because solid-state meters generally have a shorter life expectancy, the increased usage of this design will also necessitate improvements in meter asset tracking. With the right MDM functionality, utilities can choose whether to maintain this information in their asset management/enterprise resource planning (ERP) system or MDM system.

Risk Mitigation Choices

For MDM functionality, the general industry trend is to use an out-of-the-box solution that is customized, to some extent, and internally maintained. Risk assessment and selection will play a large role in the type of MDM vendor that best suits a given utility’s requirements.

That has often led to three types of vendors that vie for MDM projects:

  • AMR,
  • CIS/ERP, and
  • MDM/software analytics companies.

AMR vendors may have a distinct advantage because of their AMR technologies and previous relationships with metering departments, but it remains to be seen how well they can compete against large-scale software and enterprise systems providers. Among several options, executives will generally have to choose between two types of deployment trade-off considerations: single-vendor dependence or system incompatibility.

If a utility uses the same vendor for both the AMR and MDM systems, they are essentially assured system compatibility risks will be minimized and that initial installation and future updates will be seemingly routine. However, this approach may also limit future flexibility in expanding functionality offered by other MDM systems and vendors.

Alternatively, if you use different vendors for the AMR and MDM systems, then you may receive richer feature-sets of core functional and business requirements. Of course, that approach comes with system integration and interoperability risks. The lack of comprehensive MDM standards in the AMR industry creates additional work for vendors, which must develop individual interfaces to various AMR systems to ensure flexibility.

Cost and Contents of the MDM

Based on vendor feedback, utility executives can essentially expect that MDM system components will comprise roughly 10 percent of their AMI expenditure. Additionally, vendor experience suggests further that large utilities can expect to spend an additional 10 percent of the AMR/AMI capital on system integration-related services from a consultant or vendor.

However, a robust and functionally rich MDM system can be well worth the cost. The key, however, is planning and preparing employees for the improvements that the MDM system will bring to the utility’s overall performance, now and into the future.

Garrett Johnston is a consultant with more than 8 years experience in providing energy insights and intelligence to large investor-owned utilities. During his career, he has served more than 100 utilities, providing in-depth perspectives on a wide variety of topics, including AMR/AMI, broadband over power lines (BPL), reliability/outage management and billing. Valued for his metering expertise by both industry insiders and outside knowledge-seekers, Johnston has authored more than 30 reports on advanced metering. Johnston has a B.S. degree from James Madison University in Harrisonburg, Va. and is pursuing an MBA from Georgia State University in Atlanta.

Ron Chebra is a senior consultant in the Smart Metering Practice of KEMA. He serves as a trustee on the board of directors of the Automatic Meter Reading Association and currently chairs their Public Policy Committee. Ron has over 30 years experience in utility solutions and can be reached at ron.chebra@us.kema.com.

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