Case Study - SCE's Massive Metering Rollout

In the wake of the California energy crisis, the California Public Utilities Commission ordered its investor-owned utilities to develop business cases for advanced metering. But when Southern California Edison (SCE) performed a cost-benefit analysis, they concluded that existing technology would cost far more than it could save — a net loss of nearly $500 million.

In response, SCE project leaders went back to the drawing board and took a new approach. To succeed, they needed technology for more than just automated meter reading. For example, meters with two-way communications allow utilities to disconnect customers for non-payment or reconnect them later without an employee field visit. Such systems can also provide customers with feedback about power rates that change with the time of day (time of use or TOU charges), which encourage customers to reduce consumption at peak hours. And if load control technology is also in place, utilities can remotely adjust thermostats for even more power and cost savings.

To gain enough benefits to justify the cost, SCE needed a system with (1) the latest meter designs, (2) a communications  network, and (3) networked devices in customer homes.  But there was a problem: The technology for that kind of system didn’t exist. If SCE was going to realize the benefits from such a system, they would need to design their own future.

Systems engineering to the rescue

Working with IntelliGrid, EnerNex Corporation, IBM, and others, SCE implemented a Systems Engineering approach to the advanced metering project.

Systems Engineering is an iterative methodology. Multiple teams drill down from high-level abstractions (e.g., requirements) to real-world specifics (technology and vendor selection).  As part of this process, SCE divided the $1.3 billion project into three phases:

·      Planning (developing requirements, assessing technology, performing cost-benefit studies)

·      Testing (final development and analysis of products)

·      Deployment (installing the system in the homes of 5 million customers)

To make sure the result would be “future-proof,” SCE sought consulting partners familiar with the systems engineering approach and with the Electric Power Research Institute’s IntelliGrid architecture. Using IntelliGrid principles, SCE stepped through a rigorous process of specifying what it needed, then evaluating technology.

Gauging the maturity of technology

To determine whether a given technology would achieve their goals, SCE incorporated an evaluation process called Technology Capability Maturity (TCM). Each TCM summary consists of a matrix that lists requirements along the horizontal access and assigns a maturity level on the vertical axis. A TCM matrix shows a technology’s tradeoffs at a glance.

SCE is now approaching a successful conclusion of phase 1. Indeed, because of their careful application of IntelliGrid principles, the planning stage will be completed months ahead of schedule. And because SCE worked with vendors throughout the process, the products they need are now coming to market.

Click below to download a full case study that provides more details about the practices that have so far brought success. You’ll also get a summary of projected cost improvements over their original business case and more insight into the Systems Engineering approach.  

   SCE case study (PDF)

   IntelliGrid Web site

   Email Scott Dunn