I m proving Meter I nventory w ith RFI D ( AMR/ AMI I m plem - - PowerPoint PPT Presentation

Rob W ilhite – Director, AMR/ AMI Practice Garrett Johnston – AMR/ AMI Consultant Dan Ruiz – RFI D Specialist

I m proving Meter I nventory w ith RFI D

( AMR/ AMI I m plem entation I m pact)

Experience you can trust.

April 2 5 , 2 0 0 6

I ncorporating

Our Agenda

• I ssues w ith AMR/ AMI m etering deploym ents and
• ngoing m eter m anagem ent
• Potential RFI D solutions for m etering issues
• Tw o utility applications
• Future utility applications of RFI D
• I ndustry observations

I ncorporating

Business issues w ith AMR/ AMI deploym ent and m eter life- cycle m anagem ent

• Large-scale AMR/ AMI meter deployments

present unique implementation issues

• Identifying and resolving these issues is a

key driver to minimizing unintended impacts and maximizing project success

• In addition, ongoing meter life-cycle

management issues require greater focus in today’s asset-driven performance world

Kno wing the so lutio ns in advanc e is ke y to pr

• je c t

suc c e ss

I ncorporating

Large- scale AMR/ AMI deploym ents can present a num ber of potential challenges

• Supplie r

r e liability

• Manufac tur

ing sc he dule

• Pr
• duc t/ solution

pe r for manc e

• De ployme nt logistic s
• Ba c k-offic e inte gration
• Busine ss proc e ss

r e de sign

• Custome r

impac ts

• Re gulator

y c omplianc e

“As the pr

• je c t g e ts unde r

wa y, lo gistic s manage me nt be c o me s a majo r c halle nge in maintaining the sc he dule .” “At time s, it se e ms a n AMR pr

• je c t ha s a million moving

pa rts, inc luding me te r c o ntr

• l

and manage me nt… ” “… the ke y to sta ying on sc he dule is having the mate r ial whe n it's ne e de d.”

Source: KEMA interviews of utility representatives

I ncorporating

Logistics m anagem ent is a critical driver to AMR/ AMI project success

Inve ntor y visibility High volume data thr

• ughput

Re gulator y c omplianc e Ke y De ployme nt Issue L

• gistic s Challe nge

Ability to tr ac k spe c ific me te r s a t ke y points in the supply c ha in Ca pa bility to minimize da ta tr ansc r iption e r r

• r

s and impac ts to othe r r e ve nue c yc le busine ss proc e sse s Va lida tion of inte r na l c ontr

• ls to

me e t Sa rba nne s- Oxle y a nd state - dr ive n r e quir e me nts

I ncorporating

Post- deploym ent m eter m anagem ent also presents sim ilar business issues

• Asset m anagem ent

Stock accuracy = What is our current meter inventory level (central stores/ field locations)? Excess inventory = What minimum levels of field inventory are required?

• I nventory tracking/ traceability

Stock location = recall identification Meter forecasting = How accurately are we capturing inventory turns?

• Process confirm ation

Field installation = How effectively/ accurately are our revenue processes tracking meter sets/ replacements?

• Regulatory com pliance

Stock location = What data/ financial controls do we have to verify asset-driven revenue steams?

Greater focus today

• n meter asset

management

I ncorporating

RFI D is being considered as a solution to resolve these and other m eter m anagem ent issues

• During a recent AMR

deployment, a major utility used the best solution available at the time: bar-coding

• However, this utility is

now considering the use

• f RFID solutions to

improve its ongoing meter logistics issues

Ke y Manage me nt Que stion

Is RFID ready for “Prime Time” in utility meter management?

(or is this bar-coding on steroids?)

I ncorporating

RFI D technology w orks sim ilar to bar- coding, but perform s m ore effectively

• Tag

Passive vs. active I nternal vs. external

• Reader ( Portal and

handheld as needed)

• Com m unications to and

from readers and controller softw are

• Com m unicating data to

and from back- office system s

• Database/ integration

softw are

• Enterprise applications

( e.g., W MS, ERP)

RFI D functionality is rapidly replacing bar- coding to reduce/ elim inate m anual processes and im prove data efficiencies Key advantages of RFI D technology:

Non-line of sight Autom ated tracking ( portals) Less susceptible to dam age Larger data capability Can be read-w rite Can verify date and tim e

• f action

I ncorporating

RFI D technology is rapidly m aturing

• RFI D innovation

Second Generation

• Faster read rates
• Dense read capability
• I m proved security

Decreasing costs

• Tags
• Readers
• Portals

Movem ent tow ard individual item tracking ( Third Generation)

• Viability of RFI D

applications across m ultiple industries is increasing

I ncorporating

Many industries are already using RFI D to resolve their ow n core business issues

• Consum er products goods

industry

• Education
• Entertainm ent
• Governm ent
• Healthcare/ Pharm acy
• Manufacturing/ I ndustrial
• Retail ( e.g., W al- Mart)
• Travel/ Transportation
• Oil/ Gas

BP's c hie f te c hno lo g y o ffic e r sta te s the y will e xplo re the po te ntia l b e ne fits o f the te c hno lo g y a nd "po sitio n BP to ta ke full a dva nta g e o f this e me rg ing c a pa b ility."

When will utilities embrace this technology?

I ncorporating

RFI D can im prove m eter logistics by autom ating m anual processes

• Reduce/ eliminate meters

lost due to errors/ incomplete paperwork

• Improve supply chain

efficiencies

• Improve inventory

control/ material processing

Meter Inspection Meter Inspection

Gas Meter Tracking

A site survey examines the capability of Tag and Readers within the operating environment

Receiving Dock Receiving Dock Forklift Portal Forklift Portal Packaged for Base Station Packaged for Base Station

I ncorporating

SEMPRA Energy identified a num ber of m eter installation issues

• Limited visibility

Inability to forecast meter demand Excess/ unclear inventory

• Lost meters & revenue

Limited meter asset tracking Unidentified meter locations

• AMI

Track meter attributes Handle increased meter volumes

With new initiatives being started the organization

needs to provide on going support for increased m eter activity.

Increased need for tracking individual meter

attributes is not currently supported.

Volume of meters Because a meter is not tracked through the

warehouse to installation, there are no records about where some meters have been installed

Unbilled revenue occurs until these meters are

found.

Lost meters/ Unbilled revenue Inefficient process Excess meter inventory Limited visibility

Areas of Opportunity Meter receipts and issues are not tacked full within

the Supply Chain key-entered into SAP.

Limited supply chain visibility encourages

employees to hold excess inventory

Difficult to forecast demand for meters Unclear how many meters are in stock (in the

warehouse and on trucks) at any given time

Comments

Conclusion: I nefficient to m anually enter receipts into SAP

I ncorporating

SEMPRA conducted a proof- of- concept exercise and closely analyzed RFI D costs and benefits

Metering Logistics Supply Chain IT Customer Service Account

Management

Vendors

SE MPRA Stake holde r s

These efforts were aided by an enterprise-wide focus

I ncorporating

SEMPRA is now conducting a three m onth RFI D pilot project

• 2 warehouses: 1 gas, 1 electric
• 4 bases: 2 gas, 2 electric
• Estimated Cost: $600 to $800k

Includes IT integration and business/ systems design Utilize tethered gas tags @ $3 to $4 each 10,000 tags Regular meter management savings (operational rounds) of $250k

Result: projected payback

• f 9 m onths

I ncorporating

A full RFI D roll-out has now been approved for SEMPRA’s AMI program

• Vendor trials deem ed successful
• Hard savings $ 6 0 0 k/ yr
• Soft savings $ 2 0 0 k/ yr
• $ 4 .5 M budget approved for roll-
• ut

1.3 million electric meters 800K gas meters

• AMI program also presented
• pportunity to update m eter

inventory processes

Sempra to install 250K-800K meters/ year 3-year ROI

I ncorporating

Autom ating m eter inventory processes could increase operational efficiencies and reduce costs

Hard Savings

I ncreased revenue

( unbilled)

Reduced FTE Avoided FTE Reduced rew ork Reduced process tim e Reduced inventory

Soft Savings

Reduced adm inistration Accurate inventory Tim ely inspection reports I ncreased productivity Efficient recall process I m proved em ployee sat. Avoid handling & storage

I ncorporating

An Eastern I OU that piloted RFI D for pole tracking is now considering RFI D for m etering

• Piloting passive tags for

poles

Problem : Hectic pace of storm restoration throw s inventory into disarray Likely to roll-out after pilot

• Considering RFI D for

m etering

Problem : I nconsistent m eter inventory tracking PUC w ould favor it I ssue: Does responsibility lie w ith m etering or asset m anagem ent system ?

I ncorporating

RFI D’s value and future in the utility industry is still unclear

Through lim ited trials, RFI D has been show n

to im prove m eter supply chain logistics processes

Key questions:

What results can utility managers draw upon from other industry applications of RFID? How can other utilities seek similar results in their meter management processes? What utility-specific products or solutions will be required from the vendor community to foster greater visibility of RFID technology? What other AMR/ AMI deployment challenges/ risks can utility managers seek to resolve with RFID technology?

I ncorporating

I n addition to m etering, w e have seen

• ther utility applications
• f RFI D technology
• Tracking high-value

equipment: transformers, poles

• Refueling management
• Emergency/ maintenance kit

verification

• Verify asset installation,

inspections and maintenance

• Reductions in fleet costs:

tire pressure, fuel efficiency impact

• Security/ safety: Individual

access control and tracking

• Track specialized tool usage
• Operator rounds in

generation plants

• IT equipment tracking:

computers, network equipment

• Document management for

legal/ regulatory departments

• HazMat container tracking
• Critical asset tamper control
• Underground cable ID

I ncorporating

I ncreased utility industry visibility

• f RFI D w ill be partially driven

through vendor actions

• American Meter – installed RFID tags on gas meters for Sempra pilot and

is willing to put into production – other meter manufacturers have shown limited interest

• Intel (chips/ industry specialists) – starting to address utility industry
• Shipcom Wireless for meters (middleware) – Sempra pilot participant
• ffering RFID-based meter management solution that is available for

production

• IBM (asset management middleware) – developed RFID-based asset

management system that can be used for meter management

• SAP (ERP system) – Sempra pilot participant offering asset management

system eliminating need for middleware

• Symbol, Intermec (portals and handhelds) – both participated in Sempra

pilot and offer general utility solutions; Symbol's portals or handhelds for RFID asset management are in place at two large utilities

I ncorporating

There are a num ber of key drivers for RFI D technology adoption

1 . Start w ith a focus on resolving targeted business process issues, rather than fitting the technology to a solution 2 . Closely integrate requirem ents analyses to specific vendor solutions ( e.g., tags, readers, softw are, integrators) 3 . I ntroduce applications through proof-of-concept trials to facilitate financial analyses and further im plem entation strategies 4 . Evaluate RFI D projects as a com ponent of overall Asset Managem ent or AMR/ AMI deploym ent strategies

I ncorporating

Thank you for your tim e

Garrett Johnston ( 4 0 4 ) 3 2 4 -0 0 4 5 Garrett.johnston@kem a.com Dan Ruiz ( 9 1 6 ) 7 3 6 -2 6 1 3 daniel.ruiz@kem a.com Rob W ilhite ( 9 8 0 ) 2 4 1 -9 3 9 1

Robert.w ilhite@kem a.com