Jamaica Public Service Co. Ltd.Jamaica Public Service Co. Ltd.

C&I Automatic Metering Infrastructure C&I Automatic Metering Infrastructure (AMI) Project Applied to Loss Reduction(AMI) Project Applied to Loss Reduction

Presentation Outline

1. Profile

2. Challenges

3. Existing Loss Reduction Programs

4. Why AMI?Loss Reduction Solutions

5. What is AMI? Typical AMI SystemAMI Deployment trendsInfrastructure

6. JPS AMI Business CaseTechnology ReviewAMI Savings/Benefits

7. Project Schedule

8. Strategy

9. Project Risk Assessment

10. Financial Summary

11. Q & A

US$36MRevenue Loss

14%Commercial Loss

23%System Energy Loss

3,094 GWhSales (2006)‏

1,800Number of employees

571,000Number of customers

2,780,132Population

10,991 sq kmService Area

Profile

CHALLENGES

Perennial high levels of system loss2006 annual revenue energy loss to JPS is US$36MEscalation of energy loss over the past 5 years from 17% to 23%

Heavy dependence of Revenue assurance process on human intervention in read to bill cycle

Errors in meter readings have greater impact on large customersOver 12% and 18% of new and existing large accounts’respectively are found with anomalies annuallyThe use of revenue assurance to detect energy loss is impaired by noise in CIS database

Employee mistakes and collusionUnpredictability in monthly billed sales computation

CHALLENGES

• Heavy reliance on imported oilFuel price increased over 167% over the past 5

years Strong correlation between electricity price

increase and theft

Source:http://en.wikipedia.org

Existing Commercial Loss Reduction Program

Energy loss analysisBusiness type analysisTrending analysisLoad factor analysis

Large Accounts AuditAudit of all large accounts (5,000) every two yearsEquipment Used

Bird DogPortable Meter Test SetsE-Z Test Jack

Existing Commercial Loss Reduction Program

Summary of 2006 ResultsStrike rate – 15%

450 irregularities found

Average energy recovery per irregularity – 6 MWh/monthLargest energy recovery from a single customer –130 MWh/Month

Repeat offenderIncremental monthly revenue – US$26,000

Causes of Commercial Loss

Defective metersShorted CTsIncorrect wiringMeter reprogramming

Access to software and password by customersTamper and status flags not enabled

Meter tamperingEmployee collusion

Under reading of accountsFailure to report irregularity

Typical Change in Energy Profile After Detection of Irregularity

Typical Change in Energy Profile After Detection of Irregularity

Typical Change in Energy Profile After Detection of Irregularity

Typical Change in Energy Profile After Detection of Irregularity

Typical Change in Energy Profile After Detection of Irregularity

Why AMI ?- Sustaining Loss Reduction Effort -

KEMA T&D Consultant recommends key areas of focus:

Revenue Assurance Process tied with revenue intelligence (RI) ‏AMI Solution

AMI is key to the RI processIn providing accurate, reliable and timely information

Plexus Research Inc. – (2006 C&I AMI Business Case Study) ‏

Concludes that JPS has an attractive investment opportunity to equip its largest 5,200 customers with AMI.

C&I Commercial Loss Solution

AMI provides the following solutions:Automation of read to bill cycle prioritized around C&I customers

5,200 or 1% of customers contribute to over 50% of total salesWidely dispersed across island

Reduction in non-technical energy loss via real time automatic tamper flag and status reports.

Real-time reporting of alertsRapid response to suspected irregularities

Capture and analysis of data for supporting the Revenue Intelligence process.

Analysis and trending of alerts by customer type, location etc.Reduction of noise in the RA process

Smart Meter

Load Flow

Load Flow

GISGIS

Distribution System Planning

Distribution System Planning

Outage/Restoration

Management

Outage/Restoration

Management Meter ReadingMeter

Reading

AMI SystemAMI

System Smart Grid

Smart Grid

Energy Loss

Reduction

Energy Loss

Reduction

FutureFuture

SelectableBill Dates

SelectableBill Dates

Billing/Payment/

CRM

Billing/Payment/

CRM

OnlineUsageData

OnlineUsageData

What is AMI ?( Automatic Metering Infrastructure ) ‏

AMI Deployment Trends

Ameren KCPL NSP PSE IPL Exelon UI JEA IPC PPLWE

EnergiesCaliforni

a (All) NY (All)

Operating Costs ● ● ● ● ● ● ● ● ● ● ● ● ●Improved Accuracy ● ● ● ● ● ● ● ● ● ●Theft Detection ● ● ● ● ● ● ● ● ● ● ●Distribution Service ● ● ● ● ● ● ● ●Demand Response ● ● ●Customer Service ● ●Rate Options ● ● ● ●Billing Options ● ●Internet Access ● ●Outage Response ● ● ● ● ● ● ● ●Service Quality ● ● ● ● ● ● ● ● ● ● ● ●

Utility AMI Deployment Drivers

AMI - ( C&I Advanced Metering Infrastructure System)‏

PublicWireless Network e.g.

C&W / Digicel

PublicWireless Network e.g.

C&W / Digicel

• Main components of Plexus Research Business Case Study:• AMI technology review.• Estimate benefits of AMI.• Estimate costs of AMI alternatives.• Combine costs & benefits to find the alternative that provides best

investment outcome.

JPS AMI Business Case

JPS AMI Technology Review

• The following 8 AMI Systems solution were assessed:

6. SmartSynch( GPRS Tech. )‏

6. SmartSynch( GPRS Tech. )‏

5. Hunt Technology Inc.( Power Line Carrier Tech. )‏

5. Hunt Technology Inc.( Power Line Carrier Tech. )‏

4. DCSI – TWACS( Power Line Carrier Tech. )‏

4. DCSI – TWACS( Power Line Carrier Tech. )‏

3. Elster Electricity LLC( Radio Frequency Tech. )

3. Elster Electricity LLC( Radio Frequency Tech. )

7. Trilliant( GPRS Tech. )‏

7. Trilliant( GPRS Tech. )‏

1. Cellnet Technology Inc.( Radio Frequency Tech. )‏

1. Cellnet Technology Inc.( Radio Frequency Tech. )‏

2. Itron Inc. ( Radio Frequency Tech. )‏

2. Itron Inc. ( Radio Frequency Tech. )‏

8. Comverge( CDMA / GPRS Tech. )‏

8. Comverge( CDMA / GPRS Tech. )‏

Why GPRS/CDMA (Cellular Data Transmission Technology) ‏

Leverage existing telecommunications infrastructure.

Three cellular providers.95% coverage across island.

Very low C&I customer density.Relatively inexpensive data transfer rates.

US$2.14 per MByte.Less than 10% of existing C&I meter reading cost.

AMI Benefits Considered in Business Case

1. Regulator Compliance/ Performance Improvement1. Regulator Compliance/ Performance Improvement

Billing Punctuality (EGS 4)‏Reconnection (EGS 6)‏Estimated Bills (EGS 7)‏Estimation of Consumption (EGS 8)‏Line Fault Repair (EOS 2)‏SAIDI (EOS 4) / CAIDI (EOS 4A)‏Total System Losses (EOS 5)‏Frequency of Meter Reading (EOS 6)‏Billing Punctuality (EOS 8)‏Call Center Responsiveness (EOS 10)‏Call Center Effectiveness (EOS 11)‏

Billing Punctuality (EGS 4)‏Reconnection (EGS 6)‏Estimated Bills (EGS 7)‏Estimation of Consumption (EGS 8)‏Line Fault Repair (EOS 2)‏SAIDI (EOS 4) / CAIDI (EOS 4A)‏Total System Losses (EOS 5)‏Frequency of Meter Reading (EOS 6)‏Billing Punctuality (EOS 8)‏Call Center Responsiveness (EOS 10)‏Call Center Effectiveness (EOS 11)‏

AMI Benefits Considered in Business Case

2. Financial Operations2. Financial Operations

PQ Damage ClaimsFlexible Bill CycleMeter AccuracyFixed Billing IntervalRate Base ReturnCash Flow Advance

PQ Damage ClaimsFlexible Bill CycleMeter AccuracyFixed Billing IntervalRate Base ReturnCash Flow Advance

AMI Benefits Considered in Business Case

3. Safety3. Safety

ReducesoMeter reader injuries o Vehicle accidentso Lost timeo Private property intrusion

DetersoCustomer meter tampering

ReducesoMeter reader injuries o Vehicle accidentso Lost timeo Private property intrusion

DetersoCustomer meter tampering

AMI Benefits Considered in Business Case

4. Billing & Customer Service4. Billing & Customer Service

Remote Disconnect/ReconnectHigh Bill CallsBill ExceptionsRemote Tariff Change

Remote Disconnect/ReconnectHigh Bill CallsBill ExceptionsRemote Tariff Change

AMI Benefits Considered in Business Case

5. Meter Reading5. Meter Reading

On-cycle ReadingOff-cycle ReadingVehicles

On-cycle ReadingOff-cycle ReadingVehicles

AMI Benefits Considered in Business Case

6. Non-Technical Losses6. Non-Technical Losses

Remote Demand ResetMeter Tampering Aged MetersMeter Removal/InversionIncorrect meter installation

Remote Demand ResetMeter Tampering Aged MetersMeter Removal/InversionIncorrect meter installation

JPS C&I AMI Benefit Evaluation Results

• C&I AMI Benefits Estimates• Comprised the benefit elements shown below:

C&I AMI Annual Benefit Estimate( US$1.94M )

86%

6%7%

0%

1% Meter AccuracyNon-Technical LossesCash Flow AdvanceOn-Cycle ReadingOther

Benefit Summary – US$1.94M Annually

• Non-technical loss benefits – US$1.66M5,200 large C&I customers

Above 8% identified with anomalies in 2006

Average energy recovered per irregularity ≈ 36192 KWh/yr.

Total estimate annual energy loss (5,200 × 8% × 36,192) = 15,056MWh

• Total estimated annual revenue loss ≈ 15,056 × 1,000 × 0.11 = US$1.66M− Energy Loss Cost / kWh = US$ 0.11

• Non-technical loss benefits – US$1.66M5,200 large C&I customers

Above 8% identified with anomalies in 2006

Average energy recovered per irregularity ≈ 36192 KWh/yr.

Total estimate annual energy loss (5,200 × 8% × 36,192) = 15,056MWh

• Total estimated annual revenue loss ≈ 15,056 × 1,000 × 0.11 = US$1.66M− Energy Loss Cost / kWh = US$ 0.11

Benefit Summary – US$1.94M Annually

• Avoided C&I meter reading O&M cost – US139.4KUnproductive to read 5,200 meters at an average of 60 per meter

reader per day.Annual meter reading O&M costs @ 100 meter readers = US$3.39M

Average daily meter reading costs per meter reader = US$134

Average cost to read one C&I meter = US$2.23(Average cost to read one non-C&I meter = US$0.45)‏

Total avoided C&I annual meter reading costs = US$139.4K

• Avoided C&I meter reading O&M cost – US139.4KUnproductive to read 5,200 meters at an average of 60 per meter

reader per day.Annual meter reading O&M costs @ 100 meter readers = US$3.39M

Average daily meter reading costs per meter reader = US$134

Average cost to read one C&I meter = US$2.23(Average cost to read one non-C&I meter = US$0.45)‏

Total avoided C&I annual meter reading costs = US$139.4K

Meter facility Insp./Upgrade

JPS/Mirant Approval

IT Systems Integration

RP Intelligence Software

Smart Meter Deployment

Training & Development

Benefits Evaluation *

Hardware Lead Time

Negotiate & Issue Contract

Proposal Evaluation

Vendors Respond

Prepare & Issue RFP

DecNovOctSepAugJulJunMayAprMarActivity

AMI Project Schedule

LegendOriginal planCurrent plan (9 May 2007)‏

AMI Deployment Strategy

Objective: The determination of expected benefits early and accurately.

Deploy AMI meters on feeders with high losses (e.g. > 20%)

Feeders with history of accurate and reliable energy loss measurement

Deploy revenue intelligence application software to RP analystVerify C&I customers’ facility integrity before AMI meter installationDeploy AMI meters on per parish basis to realize avoided O&M benefit estimate.

JPS AMI Risk Assessment

Risk Probability of Risk Impact Strategy to Mitigate Risk or Achieve OpportunityOccurrence [ the issue ]

- Generate weekly expenditure/encumbrance reports

Medium

- Impact of new technology as it relates to longivity and reliabilty Medium

- Select AMI technology that has been tried and tested at other utilities - Choice of AMI system is open architecture and non-proprietory. - Include training and development in contract with vendor

- Customers lacks confidence based on changes in usage with new AMI meters. - Loss of billing data

Medium

- Operate both systems in parallel for at least 3 months and fine tune process before actual utilization for billing - Download and store all priority accounts meter data before replacement

-Integration of AMI System with JPS Banner Billing System not realized

High - Include in RFP AMI system is compatible with JPS Oracle database/Banner CIS

- Third party providing managed meter reading service to eliminate resource burden.

Medium - ASP will not be supported as part of JPS AMI requirement

- Increased project costs Medium Plexus Research direct involvement in defining scope of project

- Anticipated benefits not realized.

- Deploy AMI System to realize early and accurate determination of benefits by incorporating revenue intelligence application

-Phase implementation and evaluation of benefits- A full assessment of phase 1 implementation/benefits will determine continuation of project.

- Utilize 2007 prices and inclusion of 10% contignecy of year 1 costs to address uncertainties

High - Contracted services of consultant Plexus Research Inc. to lead the planning and organization of the project. Solicited and included vendors and meter manufacturers input on hardware lead time.

-Cost overrun

Delays and Scope Changes

Scope

High

LowBusiness Risk High-Full automated meter reading of C&I customers not realized

LowCost

Schedule

Low

Financial Summary (Estimate)

1.65702010

1.105Procure and deploy 1730 meters

1.6702009

3.3145.477TOTAL

0.552Procure and deploy 1730 meters

1.5592008

0Procure and deploy 1730 meters plus AMI support systems

2.0962007

Benefit Estimate(US

$M)‏

ScopeInvestment Costs (US$M)‏

Year

PROJECT BENEFITS

Annual benefits of US$1.9M with an investment of US$5.48M over 3 years

Phase 1 (2007) investment of US$2.10M.

IRR and NPV of 29.85% and US$3.824M respectively over 10 yearsDiscounted payback under 6 years

Non-technical energy loss reduction accounts for over 86% of benefits Cash flow improvementsReduction in meter reading O&M costs

Smart Meter

Presented By:Norman Titus

Meter Specialist/Manager, Meter OperationsJamaica Public Service Co. Ltd

113 Washington BoulvardKingston 20

Jamaica

Thank You

Questions are Welcomed