What do customers get from AMI investments?
Chris King, president of eMeter Strategic Consulting, has testified before Congress on smart meters and demand response. He is chair or board member of several demand-response organizations. Contact him at firstname.lastname@example.org.
Along with power plants, investments in advanced metering infrastructure (AMI) are among any utility’s largest capital projects. Plenty of good operational reasons support AMI investments, including lower meter-reading costs, better outage restoration, and more timely and accurate meter reads. But beyond fewer estimated bills and less trampled gardens, what are consumers really getting from AMI?
Perhaps more important, what do utility regulators expect? After all, regulators must approve cost recovery before utilities can make what are sometimes multi-billion-dollar investments. Showing sufficient cost-effectiveness to obtain regulatory approval almost always depends on achieving demand response or other societal benefits in addition to operational savings, ranging from about 10 percent for PG&E to nearly 40 percent for San Diego Gas & Electric.1
To meet these growing policy expectations, consumers need tangible results from AMI. Regulators are looking for AMI to deliver on four of the most important life goals of Americans today—and one related specifically to electricity:
• Reliable Service;
• Convenience; and
• Environmental Responsibility.
Utility commissions are responding to their constituents by dramatically increasing emphasis on funding for energy-efficiency and demand-response programs. They believe—and expect—AMI will contribute substantially to both areas.