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Seattle City Light – AMI Business Case Results

Seattle City Light – AMI Business Case Results . March 29, 2012. Introductions. SAIC Team Bob Kinsella – Smart Grid Program Manager Steve Hadden – Principal Consultant Tony Summerlin – Principal Consultant. Seattle Team Phil West Kelly Enright Brian Brumfield Garry Crane Jean Becker

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Seattle City Light – AMI Business Case Results

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  1. Seattle City Light – AMI Business Case Results March 29, 2012

  2. Introductions SAIC Team Bob Kinsella – Smart Grid Program Manager Steve Hadden – Principal Consultant Tony Summerlin – Principal Consultant Seattle Team Phil West Kelly Enright Brian Brumfield Garry Crane Jean Becker Ward MacKenzie

  3. Briefing Outline • State of the AMI Industry • AMI Business Case Overview • City Light 2012 AMI Business Case Results

  4. State of the AMI Industry • Technology: Maturity, Capabilities, Limits • Established communication technologies • New communication technologies • Standards • Cyber security • Supplier profile • Technical capabilities • Meter communication • Data management and integration • Corporate profile • Market position, existing customer base • Technology legacy: strengths, liabilities • Technical team strength • Risks • Technical • Business Many factors guideAMI selection. Weighting variesby utility.

  5. AMI Technologies • Selection usually driven by communication • Metering requirements generally (not always) met by all suppliers • Most suppliers abreast of standards for cybersec and interop • Communication choice drivers • Technical requirements • Established by business case • Supplier requirements • Utility risk approach/tolerance • Price • Subjective relationship factors • IT issues can be substantial AMI= Advanced metering infrastructure

  6. AMI Communication Alternatives 12-6424-NO-118

  7. AMI Market Status - AMI is mainstream. • AMI* deployment rate reached steady state in 2003 • U.S. AMI electric meter population is now > 30 million • Current AMI deployment rate = 12 million to 16 million per year • Most U.S. electric meters will be AMI by 2020 *AMI = Advanced metering infrastructure capable of gathering hourly data.

  8. AMI Business Case Overview AMI = Advanced Metering Infrastructure When done well, the AMI business case … • Establishes the value of the AMI investment • Validates the vision by documenting how available AMI can fulfill the vision • With sufficient capability and performance • At acceptable cost • With acceptable risk • Guides the AMI project in extracting the predicted benefits

  9. Business Case Key Inputs • Meter infrastructure costs/growth • Comm. infrastructure costs/growth • IT infrastructure costs/growth • System load data • Operations and maintenance variables • Wholesale related costs • Staff labor and vehicle costs • Financial variables 12-6424-NO-123

  10. Net present value Internal rate of return Annual net cash flow Breakeven point Model comparison of solutions AMI/MDMS technologies Traditional Own-and-Operate to Smart Grid as a Service Business Case Key Outputs • Benefits chart breakdown by department • Benefits breakdown by meter • Costs chart breakdown by department • Costs breakdown by meter • Capital and O&M costs ($36.2 M) $1.60 M $71.8 M $37.4 M NA 4.7% 12.3% 14.8% 2024 12-6424-NO-124

  11. Business Case Analysis Smart Grid Benefits • Meter Accuracy • Meter Reading Efficiency • Billing Exceptions • Billing Complaints • Unbilled/Uncollectible Accounts • Group Accounts • Cash Flow • Connects, Disconnects, and Account Transfers • Outage Restoration • Phase Balance • Transformer Overloads and Sizing • Vegetation Management • Avoided CO2 Emissions • Pre-Pay • Demand Response • Voltage Optimization • Distribution Automation • Distributed Energy Resources Costs • Multi-million dollar implementation over a relatively small customer base • Meter Infrastructure • Communication Infrastructure • IT Infrastructure • Program Management • Project Management Office (PMO) • Customer Education • Business Process and Organizational Change • Cyber Security Audit 12-6424-NO-132

  12. Business Case Benefits 2

  13. City Light 2012 AMI Business Case Results Estimated AMI Costs for City Light ($ thousands)

  14. AMI Benefit Categories

  15. Estimated City Light AMI Benefits in Traditional Operations

  16. AMI Investment Results for City Light

  17. AMI Investment Cash Flow for City Light

  18. Questions/Comments

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