Smart Energy Perspectives

Advanced Metering: What You Don’t Know CAN Hurt You


By Jesse Berst

The advanced metering sector is in turmoil and transition. Everything is changing: regulations, pricing, business models and, of course, technology. It’s exciting, but it’s confusing and risky as well.

In times like these, what you don’t know about the future can hurt you. Utilities can all too easily end up with obsolete technology. Or a pricing model that gouges them for years. Or a vendor that doesn’t survive, stranding them without adequate support and upgrades. My firm has just completed an in-depth research report on advanced metering. We uncovered significant details about the current market. More importantly, we learned of big changes on the horizon.

What’s Now

The three functions that make a meter “advanced” are:

  1. The ability to take interval measurements, measuring both what was consumed and when.
  2. Automatic transmission of the resulting data, eliminating the need for manual, walk-by, or drive-by reading.
  3. . Two-way communications: the ability to both “talk” and “listen.”

Today’s models often have other built-in functions as well, but those three define the baseline functionality.

Advanced metering is an outgrowth of the last century’s automated meter reading (AMR) systems. The AMR business case rested on labor savings: reducing the number of people needed to collect readings.

Two-way, advanced metering offers even better labor-cost reductions, but it also empowers important new applications, including: outage management, demand response and time-of-use pricing, theft detection, on-demand reads, and power quality monitoring.

Over the long run, the monetary benefits from such applications can easily eclipse the labor savings. What’s more, there is growing recognition that smart metering is a cornerstone for the smart grid of the future. As a result, it gets easier every year to justify advanced metering to regulators and ratepayers.

What’s Next

That’s where advanced metering stands today. But what’s next? Our research revealed five major technology transitions:

  1. Electromechanical to digital. This transition is almost over.
  2. Mobile to fixed. Mobile AMR (walk- or drive-by) has dominated until this point. Fixed networks will be the strong trend going forward.
  3. Separate to integrated. From meters with add-on modules to meters with many functions in one unit. This transition has just started.
  4. Custom-built to commodity. The commonalities between meter platforms and the pressures to lower prices will push meter makers to create “off-the-rack” versions. (Of course you will still be able to get “alterations” and “custom-made” units if you want.)
  5. One-way to two-way. Although two-way systems are more expensive, they enable dozens of applications not possible with one-way systems.

As a result of these and other findings, GlobalSmartEnergy believes advanced metering has reached a tipping point and will begin to predominate in new utility deployments. Indeed, the category will grow at 15 percent to 20 percent per year (versus 3 percent for meters in general) for the next five years.

In addition, GlobalSmartEnergy predicts prices will drop fast (50 percent by 2009), bringing advanced functionality for the cost of today’s basic AMR units.

There’s much more to tell than I have space. About the coming industry consolidation that will change the vendor landscape. About the entry of offshore manufacturers (notably the Chinese) into the U.S. About the emerging standards that will spell big trouble for metering companies that don’t adapt in time. And about the path forward for advanced metering software.

But I think I’ve made my point. The advanced metering sector may change more in the next three years than in the past 20. In that atmosphere of flux and volatility, you must consider more than today’s needs. You must also keep the door open for tomorrow’s revolution.

Jesse Berst is the Managing Director of GlobalSmartEnergy, a research consultancy that publishes Smart Grid Newsletter ( You can reach him at

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Next-Generation Wide Area Management


By Jesse Berst

Wide area measurement/management systems (WAMS) allow utilities to maintain “over the horizon” awareness of conditions in neighboring control areas. I recently toured a new facility at Pacific Northwest National Laboratory (PNNL) in Richland, Wash., which could be an important key to creating the next generation of wide-area tools. It may also help utilities and transmission operators solve some of their individual issues.

The Problem: Our Balkanized Grid

The grid grew up service territory by service territory over a century or so. Although the power passes through multiple service territories, our control systems do not. Each utility sees very little beyond its own boundaries.

What’s more, most control systems operate 5 to 20 minutes after the fact. (Imagine steering a speeding car by looking through a rearview mirror at a picture that’s 10 minutes old!) The 1996 and 2003 blackouts proved that grid operators need to see more of the big picture so they can predict and prevent problems heading their way. “We have to move the operation of the grid from minutes to seconds,” explains PNNL researcher Rob Pratt.

A Solution: A Control Center that Sees the Whole Picture

PNNL has now created a facility designed to accomplish that “minutes-to-seconds” goal. At first glance, the Electricity Infrastructure Operations Center (EIOC) looks like an ordinary control room with computer screens and a 23-foot video wall. But three other advantages make the EIOC especially valuable as a research and development tool.

First, the EIOC includes a full-function version of Areva’s multi-million dollar energy management system. Second, it has live data feeds from actual utility grids. And third, the EIOC is hooked up to some of PNNL’s supercomputers. There’s no utility on the planet that could afford to duplicate that enormous computing power and set it aside just for research. Couple all this equipment with PNNL’s staff of experts and you have a powerful package for perfecting next-generation tools and techniques.

Potential Uses

The EIOC is a “user-based facility”-Department of Energy terminology for government-funded locations that can be “rented” by the outside world. If your organization has ideas on ways to improve grid monitoring and control, the EIOC may offer a place to test and perfect your inventions.

Because it has live, real-world data hooked up to powerful computers, the EIOC is a great place to model the current grid. It is also ideal for testing new algorithms, new interfaces and new visualization concepts. Here are a few of the ways the EIOC could be valuable.

  • Operator training and simulation. You might think of this capability as the grid equivalent of the simulators airlines use to train pilots. The EIOC even has the ability to fake problems and failures to test operators’ ability to think on their feet in the face of disasters.
  • WAMS research. The EIOC already collects information from the western grid and the eastern interconnection phasor project, allowing it to test new ways to monitor, model and control large areas against real-world data.
  • Market operations research. As the world (ever so gradually) moves to liberalized markets, it needs new and better ways to balance wholesale markets, integrate demand response and relieve transmission congestion. The EIOC is already conducting one market test in the hopes of modernizing not just grid operations but market operations as well.
  • Interface and visualization research. Most grid operators with access to phasor data don’t use it. For that matter, most utilities don’t make much use of the data they get from their SCADA and advanced metering systems. The industry urgently needs better ways to handle massive amounts of data, convert it to actionable information, and display it so problems can be instantly and easily recognized.

The easiest way to find out more is to visit (yes, just one “n”), click the Search button, and look for EIOC. Or drop me an email at the address below and I will put you in touch with one of the staff.

We can’t manage the 21st-century grid with 20th-century tools. It is time to invest in better, faster, computer-assisted tools. Facilities such as the EIOC are invaluable to that effort. Especially if combined with ideas and inventions from people like you.

Jesse Berst is the Managing Director of GlobalSmartEnergy, a research consultancy that publishes Smart Grid Newsletter ( You can reach him at