THE CASE FOR AMI: BEYOND THE METER READ
Data has been highly transformative in many industries including airlines, telecommunication companies, social and professional networking services, oil exploration and a host of other sectors. Even the gas and electric utilities are maximizing their potential with new and better services through the promise and power of data. The water sector, however, significantly lags this trend.
While electric utilities were able to consolidate generative and transmission assets to feed a nationally managed distribution infrastructure, water utilities do not have—and will never have—a similarly interconnected physical system, which keeps water a very local business. Fundamentally this is because water is massively heavy, requires significant power and capital investment to move, and degrades from a quality perspective in transport. This lack of a nationally orchestrated grid structure results in a highly fragmented water utility industry with over 56,000 public water systems in the United States.1
This fragmentation is a significant barrier to technology advancement and adoption, particularly as it relates to AMI—Advanced Metering Infrastructure. Whereas larger regional utilities can invest in technology and spread that cost over tens of millions of customers, the vast majority of water companies serve between 500 and 100,000 people. With this smaller concentration of customers over which to leverage technology investments, many water utilities do not have the financial resources to access the tools and technologies necessary to maximize their efficiency. And as a result, they are often lacking the sophistication in data, data systems and information technology.
For the water industry, the business case for new technology must consider benefits across a wider spectrum of value propositions.
In the United States, the electric industry rapidly moved to adopt AMI as a means of managing customer demand to maximize the efficiency of power generation plants and the distribution grid. For the power utilities, the benefits were clear and significant. For water, however, the benefit has not always been clear.
AMI for water has been traditionally viewed as just a means to eliminate the need for meter readers. While this is one benefit, it is rarely sufficient on its own to justify the expense which has resulted in few AMI deployments in the water sector. This condition was further hampered by the fact that there were few systems capable of handling the much more granular, much higher frequency data produced by AMI meters.
AMI is much more than a meter reading technology. AMI is a transformative investment in data and information. Amongst other things, the information can be used to find revenue, capture non-revenue water, continuously assess the accuracy of a meter and identify failing meters, find customer-side leakage, reduce customer demand, reduce system pressures as a function of real-time demand information, reduce burst frequencies and severity, defer or eliminate capital investments in treatment infrastructure, ensure water quality and improve customer satisfaction.
These are the fundamental tenets of the Smart Grid for Water: using data to become more efficient. With the advent of systems like FATHOM that can turn this data into information, the true value and benefit of implementing AMI for water utilities can finally be realized and utilities can fully modernize their approach to water service and management.
Most utilities are leaking more data than drops.2 And that, coupled with voluntary and mandatory conservation mandates, is driving significant revenue declines in the water utility industry. By using AMI data, systematically assessing the data integrity of physical assets against logical assets, and enforcing data compliance processes going forward, utilities find revenue—as much as 20 percent—even in the face of conservation.
Further, through the integration of AMI data with customer information systems (CIS), customer presentment systems, and interactive voice recognition (IVR) systems, bad debt write-offs can be practically eliminated. This is a significant issue in an industry where the service is a basic human need and the bills are relatively small—meaning they are difficult to collect. By combining real-time billing as a result of AMI with multiple payment channels, alert notifications, and selectable billing dates, customers can tailor their use and payments to their own circumstances. The result is the utility collects more
revenue from their existing customer base.
Engaging the Customer
There is a growing understanding that people—when properly informed—can and do make conscious decisions about their water use. The use of AMI technologies provides customers with a unique opportunity to correlate their actions with their water use in real time.
In addition, there are significant innovations being applied to rate designs to encourage behavioral adaptation by customers. These rate designs, including California’s water budget-based rates, can often only be deployed in the context of increasing granularity of data—and with the necessary early warning mechanisms that provide customers with the knowledge necessary to actively manage their consumption.3
This demand reduction or control actually liberates capacity in existing infrastructure, resulting in significant deferral—or even elimination—of near-term and long-term capital requirements. It can also be used to realize significant reductions in operational expenses.
By understanding demand in real-time, engineers can justify changes to the regulatory rules of thumb that form the basis for capital design decisions. With real-time demands, utilities can develop time-of-use incentives to spread existing capacity over a larger daily time frame—maximizing the investment they have already made in the infrastructure.
Reducing Leakage and Bursts
Once demand is known, utilities can use that information to design operating pressure schedules to minimize wear and tear on infrastructure. Controlling pressure is one of the most effective leak and burst reduction techniques available. It can only be realized, however, with the real-time data supplied by AMI to forecast demand, rather than respond to it.
Ensuring Water Quality
By combining AMI data with quality information from laboratory information systems (LIMS), customer input via call centers and reporting systems through the CIS, and operational information from supervisory control and data acquisition (SCADA) systems as well as hydraulic modelling data and geospatial asset management data, a utility now has a rapid, visual assessment of water distribution system health. This allows operations staff to immediately respond to any potential issue. Further, leak detection flags and reverse flow flags from AMI systems can be employed to both identify potential ingress of contaminants and where hydraulic conditions exist that promote reverse flows.
THE WATERFALL OF VALUE
AMI is the cornerstone of the Smart Grid for Water and when combined with tools like FATHOM to surface the value inherent in the data, it unleashes a torrent of benefits for the water utility. With FATHOM, utilities can find revenue, reduce demand, defer or eliminate unnecessary capital investments, reduce operating expenses and improve customer service and satisfaction. In many cases, the value from an AMI deployment—in the context of having tools to manage and transform that data into information—far exceed the costs of the system itself. The benefit is immediate and lasting.
Finding the real value of technology adoption will allow water utilities of all sizes to become more efficient, offer higher and better customer service, and maximize the use of the investment in infrastructure we’ve already made.
2Mattar, R., “Kahramaa’s vision for non-revenue water reduction”, Water Utility 21, April 2013.
3Hill, T., Symmonds, G., The Smart Grid for Water, Advantage Media Group, 2013