AMRA's annual symposium addresses potential payoffs and lingering concerns about the technology.
The annual Automated Meter Reading Symposium, Sept. 26-29 in Reno, Nev., finds AMR a year further along in its evolution in terms of both implementation and ideas for application and usage.
But while a few electric utilities have embraced AMR and others will arrive at the symposium ready to make purchases, some uncertainty remains for others as to the what, when and how of the technology.
How Soon is Now?
"People thought AMR was going to mushroom fast," observes Bob Green, president of AMRA. Certainly, the arrival of the 12th annual AMRA Symposium raises the question, "Why the tentative attitude toward AMR?" Numerous opinions are floating about, and while some may seem to conflict, that's actually not the case.
"It's not technology, because the technology is there," says Green. And yet, "Obsolescence is one of the biggest fear factors," says Ron Chebra, executive director, business development at AT&T Solutions and president-elect of AMRA. So the technology is there, but the perception is that it still must evolve.
And then, of course, there is the competition variable that creates a question mark for electric utilities trying to create business plans for an uncertain future. AMR costs money, and a utility wants to be sure it can recoup its investment. One belief in the industry, in fact, is that if it weren't for competition, AMR would have taken off much faster because of utilities' guaranteed return on investment. Green, manager of meter technology services at Duquesne Light Co., says that because of the uncertainty introduced by competition and the possibility of metering unbundling, the utilities are being cautious. "They're taking a 'let's wait and see' attitude," he says.
Ironically, though, it may be the very beast that in the beginning stymied AMR that ends up fueling it into prevalence. Competition and the consumer ultimately will drive AMR forward, says Chebra. "Instead of a utility push, we may see a consumer pull."
But when will all the shiny new technology push AMR ahead? Raymond Saleeby, managing partner of AT&T Solutions, is willing to venture a guess. "In two or three years, 99 percent of utilities will have different ways of doing business," he predicts.
Saleeby and Chebra point out that AT&T Solutions, the networking arm of AT&T involved with AMR, is one of the fastest growing business divisions of the telecommunications giant, with between 13,000 and 14,000 employees. As for AMR specifically, by 2002 electronic channels will at least be an "alternative," Saleeby says.
Meanwhile, Duquesne is one utility that chose not to wait. A utility front-runner in AMR implementation, Duquesne's metering is scheduled to be 100 percent automated by the end of the year, according to Green. "Our management said, 'let's move, and let's move now.'"
What's the Payoff?
Is AMR a futurist technology, or is it rooted in the here and now?
What makes the AMRA Symposium meaningful, Green says, is that it's not just another forum for the vendors to show their wares. "We try to get utility people in the presentations," along with the vendors, to present all sides, Green says. He cites as an example the presentation, "The Strategic and Economic Value of AMR - Three Views of the Business Case," which places on the stage two people from utilities (Jerry Bonser, New Century Energies, and Brian Pollom, Puget Sound Energy) together with one vendor (Susan Layne, Schlumberger Industries).
Symposium goers, Green says, "want opinions of those who have implemented [AMR]," and one thing they definitely want to hear about is cost justification (translation: "Why bother?"). To justify the high costs associated with AMR, companies want to know what it can do for them beyond just giving them a meter read. In addition to the more indirect - and perhaps less immediately usable - benefits of AMR such as customer data, prospective AMR purchasers want quick and tangible rewards for investing in AMR systems, such as outage information and on-demand read capability.
That's where people like Carolyn Kinsman, president of Automated Communication Links Inc., come in. Kinsman, who is presenting two courses at the symposium and is AMRA's education chairperson, compares the information available from AMR to what local telephone companies use to market different packages to customers based on what's going on in their homes.
"The data looks almost identical," Kinsman says, when you compare the usage patterns provided by AMR with the information that the phone companies use for marketing and packaging.
Attempting to provide information that conference goers need now, Kinsman's AMR overview course, "AMR Technologies Assessment, Service Criteria and Purchasing Options," focuses on the technologies "you can go out and buy today." In addition, the course attempts to help future purchasers of AMR to define exactly what they want. Kinsman gives as an example how a company often says it wants to be able to do "on-demand reads." Not a very refined objective, according to Kinsman.
"Many systems can do it. You just have to configure it. But it's expensive." Kinsman gets the company to define exactly what it means by "on-demand." If a company wants reads within minutes, it's going to be a lot more expensive than if it could accept, say, a six-hour lag time. The same issue would need to be addressed when considering outage detection: Do you have to know about outages within minutes, or within hours? Her presentation is rooted in the present, and Kinsman hopes that symposium goers would come out of the course "more of a savvy shopper."
Kinsman's other symposium course, "Using Customer AMR Data to Build," moves into the business strategy realm and discusses what types of packages can be offered to commercial and industrial customers, and what kinds of value-added services residential customers would be willing to pay for.
For companies that already use AMR, such as Duquesne, the benefits and even the necessities of having AMR already are apparent. Duquesne's system brings in daily reads, which are used not only to do forecasting, but also for reconciliation with the various electricity suppliers. In that sense, Green observes, retail competition has made AMR a necessity for his company.
Meanwhile, other utilities are looking forward to the data mining potential of their AMR systems. Says Stacy McCollum Spahle, interim director of marketing at Nevada Power Co., which is running an AMR pilot program, "AMR will allow us to know how [customers] are using our service." knowledge, Spahle says, will allow Nevada Power to create a variety of services, from pricing options to bundling of services.
The question remains, will one particular technology emerge out of the pack? Chebra says no, because "consumers want choice."
And what's already happened in AMR seems to indicate Chebra is right. Duquesne has found that one technology doesn't fit all. The utility ultimately went with a hybrid system, relying primarily on radio technology, but also incorporating some cellular and telephone technology into its AMR mix. "There wasn't one technology solution to apply to 100 percent of our customers," he says.
Along the same lines, Chebra foresees a market in which metering is only one component of a greater, convergent system going into the home. "Meter reading won't be the primary reason why I have broad band technology in my house," Chebra says, but AMR will be able to take advantage of it being there. The bottom line, according to Chebra, is that technology will follow the need, and not the other way around.
But how do we get to the brave new world where the dishwasher talks to the electric meter? According to Kinsman, for AMR to finally prevail, it will take a combination of utilities and new business ventures working together, because each side needs the other. While non-utility business ventures generally have greater belief in market potential and are hungrier to succeed, they do not possess a full understanding of the risks involved as the utilities do.
"You can't do it with one or the other," Kinsman says, "because each one comes with its own set of baggage."
In terms of the more forward-looking technology, convergence continues to be on the minds of those willing to prognosticate. Says Kinsman: "AMR will be a part of this whole activity to consolidate." Meanwhile, tapping into AMR technologies that not only give a good read but also answer questions such as "How energy-efficient is my fridge?" or can set the dishwasher to operate at the most efficient time of day, are end results that Chebra looks forward to. To get more bang for the AMR buck, Spahle sees potential for "things that go beyond the meter," such as energy management, security services, two-way communications and heat detection for safety purposes.
But change is already here. As Chebra likes to say, "It's no longer business as usual because business is different, and it's very unusual." And with respect to changing views of the end-user, marketer Spahle puts progress in perspective. On the one hand, the industry still needs to come a long way, she says, but she also points out that it was not long ago that customers categorically were referred to as "ratepayers."
Of course, the way for AMR to advance is for companies to invest in it. Does Bob Green see the symposium itself as something of a catalyst for AMR? "Yes, because you get some participation from people who may not be sure. It gives them a greater comfort level - in that sense, it's a real catalyst."
Carl J. Levesque is an editorial assistant at Public Utilities Fortnightly.
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