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New report: 5 smart meter applications can help utilities unlock billions of dollars in value

At the ACEEE's biannual conference last month, analysts from the Electric Power Research Institute presented a new study on the future of advanced metering — summarizing our present, divining what's next, and exploring the value that AMI can unlock for utilities and consumers alike.

 

EPRI-logo

The short answer: advanced metering infrastructure can unlock a lot of value. A previous EPRI study found that AMI can net utilities billions in cost savings, at a benefit-to-cost ratio of up to $6 to 1. The first step to claiming that opportunity is understanding exactly what high-resolution energy data can do. In their latest paper, researchers at EPRI identified 5 smart meter applications that have already begun to revolutionize the way leading utilities do business — and how their customers think about energy use.

 

1. Load curves

Whether you’re looking at homes, businesses, or industry, different people use energy in dramatically different ways. A sandwich shop that feeds hungry office workers during the lunch-hour rush will see their energy use peak much earlier in the day than a swanky bistro, for example. Likewise, a household with two breadwinners is going to use electricity much differently than a retired couple that spends more time at home. But to date, utilities have essentially lumped all their customers together, regardless of usage profile. They didn't have a choice — without hourly or sub-hourly meter reads, power companies couldn't capture or quantify different users' daily energy habits, much less segment and tailor their services for different kinds of consumers. With AMI data, new insights and approaches become possible. In particular, utilities can now get more granular data on load shapes — the unique curves that represent a customer's average energy use at every hour of the day. Here's a sample from the report:

Sample Load Curve

Utilities aren't segmenting their customers by load shape yet, but the technology is available to them. And with it, they'll be able to drive all kinds of business outcomes — pinpointing afternoon peakers who can best achieve demand response, delivering unparalleled energy insights for homes and businesses, and optimizing customer engagement with the right message for exactly the right set of users.

 

2. Measurement and verification

Before advanced metering, utilities couldn't measure their energy efficiency and customer engagement outcomes in a way that was precise, direct, and granular. That was especially problematic for demand response programs, where results unfold over minutes and hours rather than days or months. As smart meters spread across service territories and around the world, utilities are finally getting the data they need to keenly measure and refine their efficiency, engagement, and DR programs. In turn, they'll be able to wring more value out of those investments, and start offering more of the energy services customers expect.

 

3. Energy auditing

A recent study from Accenture found that 62 percent of residential energy customers want their utility to deliver home energy audits. Traditionally, that's involved an in-person visit and a consultation, and utilities have had trouble scaling that kind of service across their territories. When you combine AMI data with a handful of customer-supplied data — things like occupant information, appliance information, and building envelope data — you get something that amounts to a virtual energy audit. And with it, utilities can offer a powerful new tool to identify energy savings potential, share it with their customers, and drive efficiency and engagement outcomes. One company that's seizing that opportunity is FirstFuel Software — an Opower partner, and a leader in large-scale energy data intelligence. To date, their analysis of AMI data has helped identify over $600 million in commercial building energy savings potential.

 

4. Business intelligence

This one pretty much goes without saying. The more information utilities have about exactly when, where, and how energy is being used, the better they can manage the grid. Moreover, by learning more about the homes and businesses they serve, utilities will also be able to optimize customer care. All of these forms of business intelligence are poised to drive down utilities' operational costs and improve their operational performance.

 

5. Customer acquisition

In deregulated markets like Texas and the EU, utilities' success also depends on identifying customers with a relatively low cost-to-serve, winning those customers over, and retaining them for the long haul. Companies that deliver the best energy management services have a huge competitive advantage here. And when it comes to AMI-enabled energy management services, what do customers actually want? Accenture asked more than 13,000 residential utility customers in 26 countries what value (if any) they expect advanced metering to provide. Utility customers responded loud and clear: personalized advice to change their habits and save energy.

 

Bar-Chart-Services-with-Smart-Meter

 

What's next

The key takeaway from EPRI's report is that AMI investments have incredible potential, and it's still largely untapped — but that’s starting to change. Leading utilities around the world are making a big push on smart meters, and their investments in AMI-powered energy services are ramping up fast. With billions of dollars in benefits on the line, it's no wonder why.

 

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