Imraan Mohamed Marketing Manager Itron South Africa

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1 Imraan Mohamed Marketing Manager Itron South Africa

2 Agenda: Architecture for Smart metering 1. Context : Smart Grids and Smart Metering. 2. The Smart Metering Value Chain. 3. Key Tenents for Smart Metering Technology. 4. Conclusion- Take-aways.

3 1. Context : Smart Grids & Smart Metering

4 1.1 What will a Smart Grid look like? Disconnected, basic sensors Disparate systems Limited communication Intelligent sensors Smart, unified systems 2-way communication

5 1.2 What changes will the Smart Grid bring?

6 1.3 Where does smart metering fit in?

7 2. SMART METERING VALUE CHAIN

8 2.1 SMART METERING DRIVERS Revenue assurance» Automated correct Billing» Non-technical loss detection & reduction» Smart Payment options» Remote Contract Management Smart Grid» Data for Demand Forecasting» Load Management (DSM)» Distribution Network monitoring» Near real time Optimised performance of the grid. Energy efficiency» Customer awareness and automation of home energy use.» Reduce Carbon Emissions» Support DSM.» Micro-Generation» Multi-Energy

9 2.1EVOLUTION OF METERING DEVICES 9

10 2.2 Evolution of the Value of Meter Data Costs Value Chain Cost per point Transformation Handheld Meter Reading Simple consumption read AMR Walk-By Reading Low Meter Reading Costs Operational Efficiency Revenue Cycle Improvement Security AMI Pre-payment/Drive-by Meter Reading Customer service improvements Revenue Protection External remote connect/disconnect Outage/Restoration Notification Voluntary TOU 3rd party load control Interval Meter Data Utility and Customer Benefits Open Standards Two-way Communications to a smart meter Smart Grid Smart Grid Mandatory Time Based Rates Remote Disconnect/prepayment Mass Market Demand Response Home Automation Distribution Reliability Distribution Management Distributed Generation Intelligence Grid Digitization Technology Integration Meter Shop Enterprise

11 2.3 Smart Metering Value Chain Meters Other Field Devices Communi- Cation Meter Data Collection Systems MDM System Systems Integration System Operation End Consumer Engagement Enable/support the following: Smart Grid Data processing Billing Field operations Distributed Generation Customer Management Meter MGT Multi Energy, E,W,G,H,C Energy Management SMART METERING IS NOT ONLY ABOUT THE METER Main benefits of Smart Metering: Accurate customer billing. Black-out prevention. Reduction of non-technical and technical loss. Involvement of end consumers. Leverage Communication Infrastructure. Integration to existing Utility IT landscape Process efficiency / productivity Cost controls Massive Data Management, Analytics and Business Intelligience. Support different Energy Market models. Integration of Renewable energies. Support Muti-Energy: Electricity, Water, Gas, Heat, Cooling

12 3. INVESTING in SMART METERING

13 Smart Grids AMI AMR Drive-by Drive-by Walk-by Walk-by 3.1 Changing Requirements Fixed Fixed N/W-AMR N/W-AMR Open Open Protocols Protocols 2-Way 2-Way Operational Improvements Revenue Cycle Improvements Meter Reading Cost & Efficiency Net Metering, Distributed generation Outage Reporting Support for SmartGrid Demand Response Remote Disconnect / Prepayment Energy Efficiency TOU tariffs: Mandatory or Voluntary Revenue Protection / Theft Detection Enterprise Meter Data Management TOU / Demand / Net Metering New Products & Services Home Automation RTP / CPP / Hourly Rates

14 3.2 Key Tenets for Investing in Smart Metering A. Standards B. Security C. Unified Platform & Architecture D. Extensibility

15 A. From Standards to Interoperability Standards are not enough Interoperability requires a support framework

16 From Standards to Interoperability Close the gap 1. Limit the scope of application -> define use cases 2. Select from the existing standards 3. Define the options left by the standards 4. Provide a companion specification to the standards 5. Provide interoperability testing 6. Manage the test label

17 12-JUL :34:45 ictt version Licensed to: KEMA-IDIS Cert. Tester: Bas Roelofsen ***************************************************************** ****************** * Identification * ****************** Manufacturer = { Name = '\ITRON Metering Systems' ThreeLettersId = '\ACE' } DeviceUnderTest = { } IDISDeviceType = 100 IDISFunctionType = [EXTENSION_D, EXTENSION_L, EXTENSION_M] SerialNr = *********** * Summary * *********** PASSED 1203 FAILED 0 DISABLED 0 INAPPLICABLE 295 INCONCLUSIVE 0 FATAL 0 TOTAL 1498 ********************************** Test Case 1 : Discovery, 1 item(s) ********************************** (1) Meter Discovery ******************************************** Test Case 2 : Connect and release, 4 item(s) Eg: Standards to Interoperability Standards Agreements Interoperability Specification Test Tools Development Device Testing Interop Testing Test Report test repo (IDIS) is the only true open, multi-vendor interoperability effort we can point to worldwide. Pike Research Sept 28, 2010

18 B. Security Architecture Secure by Design Methodology Secured Data, End-to-End Symmetrical key encryption for point-to-point messages Asymmeterical key encryption for broadcast messages Secured Communication Network, End-to-End Standards based Unified Security Management across the Connected Grid Keys, Encryption, Processes, Monitoring Smart Metering Architecture

19 Smart Grid are transforming utility networks Existing proprietary vertical applications Applications share common infrastructure, networks and data Business Application 1 Business Application 2 Business Application N Application Infrastructure Network Infrastructure Converged Network Gateway s / Concentrators T & D Substation FAN / HAN

20 C. Unified Platforms POINT SOLUTION CONVERGED PLATFORM TO A POINT SOLUTION APPROACH High cost and complexity. PLATFORM APPROACH Standards based hardware, software, and communications platform

21 translate this to smart metering architecture Unified Device Management APPLICATIONS / USE CASES e.g. Prepayment Tariffs Load Management Data security Unified Network Management All metering end-users consistently managed Unified Metering Architecture Performance Diagnostics Configuration Network security Firmware download

22 D. Extensibility Ability to accommodate new (smart grid) applications and use cases Secure, robust upgradability of firmware without impacting or interrupting metrology Communications modularity, logically and physically, for both Home Area and Wide Area Networks (HAN & WAN) Investing now in an asset that will remain on the wall for 20 years BUT that can be flexible and upgradable for new smart metering & smart grid applications.

23 D. Extensibility 20 years (tech lifetime) Meter lifetime evolution Interoperable Modular + Integrated Security Upgradable Future proof Coms lifetime evolution Interoperability New communication technology New module New version of existing communication technology appearing in the market

24 In Summary for South Africa Standards and interoperability NRS 049, being revised. STS, support for smart metering? Progress, but standardisation and a qualification framework is mandatory Security Good knowledge base STS and Key Management Needs logical extension for data security and standards based communication security (IP ) Unified Platform and Architecture Good skills basis Need architectural strategy / roadmap, and standards based harmonization at systems and meter level end to end Extensibility Today decisions are NOT based on Total Cost of Ownership over years, but on immediate CAPEX investment?.

25 Take Aways Business Case Be clear on this. Are you solving a short term DSM problem or a want smart metering for all the long term benefits that span across the value chain. What is your target segment? Communication Technology The communication layer is critical for the success of AMI. No one solution fits all.» Meter Interoperability Essential for a competitive Smart Meter implementation and drives Technology Innovation.» Conduct Pilots Small pilots with single vendors and proprietary solutions are a No go, especially while issues like standardisation and required functionality are still work in progress. Use Pilots to prove end to end solution/interoperability for mass roll-outs. Process/Technology/People Drive the AMI vision through firm processes, Technologies and practices, and up-skill People to ensure a solid support structure. Meter Deployment Process Establish realistic deployment plans within your constraints. Not all implementations will work the same. Smart Metering is NOT about the meter. However request a flexible, modular, upgradeable meter. Engage with the End Consumer. Engage with the End Consumer. Engage with the End Consumer. 25

26 THE ARCHITECTURAL APPROACH TO BUILDING A SMARTER GRID IS ONE OF THE MOST IMPORTANT STRATEGIC DECISIONS STANDING BEFORE US INVESTING IN THE RIGHT END TO END PLATFORM FORMS THE CORNERSTONE OF ANY INVESTMENT DECISION

27 The advent of the "smart meter" marks the first real upgrade to end to end electrical billing since our grandparents were born. It will allow energy providers and end consumers to communicate directly with each other. THE ARCHITECTURAL APPROACH TO BUILDING A SMARTER GRID IS ONE OF THE MOST IMPORTANT STRATEGIC DECISIONS STANDING BEFORE US INVESTING IN THE RIGHT END TO END PLATFORM FORMS THE CORNERSTONE OF ANY INVESTMENT DECISION 27

28 2.2 Metering Evolution to AMI benefits Manual Meter Reading Electronic Meter Reading In Field Meter Reading e.g. Drive-by Automated Meter Reading (AMR) e.g. MV90 Advanced Metering Infrastructure (AMI) Meter Data Management (MDM) & System Integration Smart Grid/ Home Automation (Customer Energy Market participation) Shift from AMR to AMI is occurring Distributed Generation Smart Grid Meter Ownership Meter Installation Field Operations Comms Infrastructure Data Processing Billing Customer Management Energy Management Supports the first steps towards home generation Micro grids Enhanced system control Better demand and supply mgmt Self healing networks Upgradeable firmware New services Job opportuniti es for meter installers Fault detection easier and more cost effective Outage restoration quicker and easier Lowers meter reading costs Can increase frequency of reading Reading & Billing data more accurate data received On demand data received Fewer exceptions Billing options and tariffs can be changed more quickly and more easily Improved revenue protection Reduced Customer complaints More flexible tariffs New tariffs can be implemented quicker Reduced calls Greater awareness of energy use leads to greater energy efficiency Smart meters create opportunities for new energy management options

29 LESSON LEARNT (1) DEPLOYMENT CHALLENGES Initial expected deployment plans ( projections) of smart metering not materialising as envisaged. There are Large number of Pilots of varying sizes in progress to evaluate impact and learn while technical, legal and social issues are addressed. A significant slowing down of execution indicating a cautious approach. Lack of skilled resources and general capacity to deploy projects on a large scale without proper planning and prior to evaluation of pilot results. Indications are that momentum picking up in 2011 and new targets set towards ECONOMIC BARRIERS There are many parties involved, and the benefits of smart metering may accrue to parties than do not necessarily bear the costs. Large scale AMI deployments take long and are costly. Opposition from regulators to increase the tariffs further and ask final users to pay for it. Business case Justification or target segment strategy not always clear. Funding Issues - Many AMI Pilots planned but delayed.

30 END CONSUMER CHALLENGES LESSON LEARNT (2) Initial lack of involvement/education. (Dutch case, Improving in UK) Need to be convinced of benefit and savings to them. Concerns about security, privacy & health TECHNOLOGY CHALLENGES Standardisation taking longer then expected. Convergence of Technology well progressed but not fully there in totally inter-operable manner. Lack of interoperability between different smart meter systems. No open registered standards exists which properly scopes all of the different functions (metering, communications, presentation, and network). Availability of multi vendor Technology modularity progressing especially in larger scale multivendor pilots. (Eg EDF and DSMR 4.0)