Why Use Automatic Meter Reading?

In the past, one of the main drivers for a utility's interest in AMR has been to reduce the cost of performing meter reading. Although cost reduction remains a significant influence in the growth of AMR, the worldwide deregulation of the gas and electric utility markets has accelerated the interest in AMR systems.

Within a deregulated utility environment, customers may have a choice for selecting their energy source provider. As a result, many utilities are becoming more competitive and are moving toward operating in an open market environment, where prices are set on an hourly basis through supply and demand mechanisms.

The implications and implementations of this open market environment often place an additional need on the utility that moves toward AMR beyond their need to improve service and to reduce their operating costs. In many cases, meter data must be provided to multiple parties such as the local distribution company (LDC), the energy service provider (ESP), an energy service company (ESCO) and even the regional transmission operator (RTO) in a timely and accurate basis. Further, customers have come to anticipate, as well as, demand that their metering and billing is accessible on-line.

Recently energy services have been migrating toward real-time pricing structures, with time of day (TOD) or time of use (TOU) financial mechanisms as incentives or penalties to drive a consumption behavior. Depending on the type of AMR system deployed a utility may use this infrastructure to accomplish this time of use metering without having to change the meter unit itself.

AMR offers both utilities and their customer's key tangible benefits.

Benefits of AMR to utilities include:

  •     Reduced meter reading costs
  •     Ability to access difficult-to-read meters
  •     Improved customer service
  •     Reduced percentage of estimated bills
  •     Improved meter reader safety
  •     Implementation of real-time pricing
  •     Reduced read-to-bill time
  •     Distribution automation
  •     Improved fraud detection

Reduced meter reading costs:

Conventional meter reading is a labor-intensive process and can represent a considerable percentage of a utility's operating cost. In addition to the labor component, ancillary elements such as vehicle costs, insurance claims, uniforms, etc. are recurring costs that can be avoided by using a technology solution. Further, in many areas public utility commissions have placed limitations on the number of times that a utility can estimate a meter reading.

Ability to access difficult-to-read meters:

In many cases, utility meters are located within the customer's premises. This is particularly true for water meters in areas where the temperatures may cause the meter to freeze. Accessing these meters often requires the meter reader to gain physical access to the meter to read it. With economic conditions today, the problem of gaining access to the home has grown as more and more people left the home for work. For example, the proportion of US households unoccupied during the day has risen from around 25% in 1960 to over 50% today. This has led to a large rise in estimated bills, re-reads, lost revenues, and undetected meter tampering or theft.

Improved customer service:

In a deregulated environment, customer satisfaction and retention are key components of a successful utility. AMR can help utilities improve customer service by providing timely and accurate bills, automating outage notification, reducing customer disruptions caused by manual reads and improving the process of resolving meter reading disputes. Additionally, there is heightened customer sensitivity about allowing strangers access into homes.

Improved meter reader safety:

Whether it is a dog, a high crime area or a confined space, meter readers today can easily find themselves in unsafe environments. AMR helps to reduce the threat of dangerous situations by automating the meter data collection process.

Implementation of real-time pricing:

Variable rate tariffs based on the time of day can be used to encourage consumers to shift their consumption of valuable resources to off-peak hours, while also discouraging the usage during peak hours. This enables energy producers to reduce the maximum capacity of their plant and therefore achieve a better return on capital.

Reduced read-to-bill time:

AMR allows utilities to reduce their read-to-bill time, by tightly integrating the meter data capture and billing process. In many cases, improved meter data acquisition permits utilities to increase billing frequency or offer more billing options to their customers.

Distribution automation:

AMR can allow utilities to provide better customer service by enabling a greater level of functionality over their distribution network, including: remote credits to pre-payment meters, remote connect/disconnect services, tamper/leak detection and outage notification.

Improved fraud detection:

AMR allows utilities to detect whether or not a meter has been tampered with or if wires have been cut at the meter. The system will flag the account with a code notifying the meter reader to investigate the situation.
Benefits of AMR to the utilities' customer:

  •     Accurate billing statements and improved customer service through the reduction of estimated readings and billings
  •     Improved meter reading accuracy through the reduction of errors from manual readings
  •     Improved security because the meter readers no longer need to gain access to the property or households
  •     Customers can move more easily between different rates creating greater choices
  •     Improved information on energy consumption for tracking purposes and conservation

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