AMI/AMR Benefits Utilities and Customers

Aug. 31, 2016

Editor’s note: This article first appeared in the in July/August 2014 issue of Water Efficiency.

The upgrade that American Water is now undertaking is no small matter. But the change that the company is rolling out now in a pilot program will allow its meter readers to more easily discover possible leaks, uncover meters that have been tampered with, and identify unusual flow activity for business and residential customers.

That’s significant. American Water doesn’t serve a small area. Based in Voorhees, NJ, the company provides drinking and wastewater services to an estimated 14 million customers in more than 40 states and parts of Canada.

American Water’s upgrade, which will make it easier for meter readers to more accurately tap the data provided by the company’s existing automated meter reading technology, is an example of how smart meters and increased data can help both a utility and consumers. Once the upgrade is rolled out throughout American Water’s service area–something that happen in the middle of 2015l–American Water’s end users can learn more quickly if their toilets are running. Business owners will learn sooner if a water leak is costing them valuable dollars each month. And American Water will be able to provide improved customer service, reduce its labor costs, and send its customers more accurate bills.

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And American Water isn’t the only water provider seeing such benefits from upgrading the way its meter readers obtain and record water usage data. Water utilities across the country are investing in automated meter reading (AMR) so that their employees can access water use numbers either by driving down city streets to obtain them, or viewing the numbers from a central location in a utility facility. Either option helps eliminate the human errors that occur when employees read meters manually and also require less manpower.

Other providers are making the move to advanced metering infrastructure (AMI), the next step up from AMR technology. With AMI technology, utilities can access reams of water consumption data, broken into time periods of as short as 15 minutes. They can use these numbers to more rapidly detect leaks in the homes or businesses of their end users. They can use the data to more accurately bill their customers, reducing the amount of unbilled water flowing through their systems. And many are even setting up Web- or smartphone-based portals that allow customers to see how much water they’re consuming each day, and how it compares to past months and their neighbors’ usage levels.

“This technology is definitely an advantage to customers,” says David Hughes, water research manager in the innovation and environmental stewardship group at American Water. “There are so many customers who have internal leaks that they might not know about. You don’t want them to have to wait for 30 days–what is often a traditional billing period for a utility–to see that their water consumption has suddenly jumped. Even a very small leak running all day and night can add up to a lot of water.”

Making a Change
American Water’s tech upgrade will allow its meter readers to simultaneously read different metering systems through their service area. This is important, since some of American Water’s service areas have more than one type of metering system in place.

“The last thing we want is for our meter readers to go out, read the meters, react, and then return to the office, only to find out that they missed five different locations,” says Hughes. “With our upgrade, the readers will get all the information they need [with software reads] right out in the field. The meter reader can then react as necessary. Maybe the reader will discover that a wire has been cut or a meter is broken. The dashboard will show high reads, reverse-flow reads, evidence of tampering. Those will get the reader’s attention right away.”

The upgrade was rolled out in the spring as a pilot in Sacramento, CA. After company officials get comfortable with the amount of data that the upgrade will provide, the plan is to spread the new technology throughout American Water’s service areas, with much of this happening before the end of this year, Hughes says.

The good news is that many utilities are either upgrading for the first time to AMR, or adding AMI capabilities to better take advantage of their existing AMR tech.

The reason for this? It’s all about the dollars that AMR and AMI technology can save utilities.

Steve Rudd, director of business development at Greenville, SC-based Utility Partners of America, says that more utility directors are learning that both drive-by or fixed-network AMR systems can reduce their utility’s yearly costs.

It’s not cheap to employ workers to walk through neighborhoods to manually read meters. And this cost is just one of the many associated with traditional manual reading, Rudd says. Utilities, for instance, pay more in fuel costs and vehicle maintenance as their employees travel through the neighborhoods in their service areas. Utilities must also shell out the dollars for the higher insurance premiums they might face when sending employees out on meter-reading runs.

Then there are injuries. What if a meter reader is bitten by a dog or slips and falls during the icy winter months? These injuries can add up to big dollars over the years.

Utilities that upgrade to AMR and, especially, AMI technology can reduce or eliminate some of these costs, Rudd says.

“AMI systems allow utilities to collect readings without the need for a truck roll, which drastically reduces their operational costs as they relate to meter reading and account maintenance,” he says.

Another big source of savings, of course, comes in the form of more accurate meter readings. As Rudd says, meter readers are human. They aren’t perfect, so they might record incorrect values. And even if the meter reader is correct, other utility staffers can introduce errors when they manually key the meter reader’s reports into the utility’s billing system.

“AMR/AMI readings in contrast are much more accurate, as the element of human error is removed from the process entirely,” he says.

Utilities might find that the older their traditional mechanical meters are, the more beneficial it will be for them to upgrade to smart meters and AMI technology. As Rudd says, mechanical water meters tend to steadily lose accuracy during their lifetimes, especially at lower water-flow rates. This might work in the favor of customers, but it also results in utilities not collecting the proper amount of revenue for the water they deliver. This problem will only worsen as mechanical meters continue to age.

Rudd cites recent studies showing that as much as 12% of all water delivered by utilities might not be measured by older mechanical meters.

John Sala, director of marketing for systems at Tallassee, AL-based Neptune Technology Group, says that utilities don’t even always have to invest in the most-advanced AMI system to realize significant benefits from of upgrading from older meters. For some utilities, even the most basic of AMR systems can provide a dramatic benefit, he says. For instance, some utilities still ask homeowners and business owners to self-report their water-usage data. This, of course, is far from an ideal situation. And it’s one that even a basic AMR system would alleviate. It makes sense, then, for such utilities to upgrade even if they can’t invest in a higher-end AMI system.

“Having consumers read the meters themselves is problematic,” says Sala. “Reading a water meter isn’t always that simple for a lay person. It can definitely create problems.”

Recycling water meters brings some income to utilities
while keeping materials out of landfills.

Other utilities still only read customer water meters only once a quarter. This, too, can present problems. “What if a customer has a leak and that customer’s meter is only being read only once a quarter?” he asks. “A lot can happen that can be detrimental to you as a consumer in that period of time. That problem can be fundamentally solved even with just a drive-by AMR system. That makes it easier for meter readers to get almost all of the meters read correctly. That’s a huge improvement for many utilities.”

Tech-Savvy Consumers
The fact that consumers today are more tech-savvy can make it easier for utilities to upgrade to more advanced meter reading and data collection systems.

Morrice Blackwell, New Product Sales and Market Development manager at Milwaukee-based Badger Meter, says that homeowners and business owners today are far more likely than in the past to access the water-usage data that AMI systems can generate.

The reason? Smartphones. End users today are becoming more infatuated with these devices every day.

“If you’ve driven a mile to your office and you realize that you’ve left your smartphone behind, what do you do?” asks Blackwell. “You drive back home and get it. That’s how dependent we are on our smartphones.”

This is good news for water utilities, he says. The savvy ones are creating smartphone apps that consumers can click on to see how much water they’ve consumed, how that usage compares with a typical day and how their water consumption compares with their neighbors.

A smartphone app might also send messages to consumers when the utility detects evidence of a leak in their homes, saving these consumers the pain of a higher water bill next month.

“I think this is such an exciting area for utilities,” says Blackwell. “People are much more likely to click on a smartphone app than they are to go home, turn on their computers and log into a customer portal. As more utilities invest in AMI, more of them can also create these smartphone apps that really engage customers in their water usage.”

Steen Schelle Jensen, head of product management in the metering systems division with Kamstrup, would not disagree. He says that he is seeing an ever-increasing number of utilities upgrading to more advanced AMR or AMI systems today.

The reasons for this are many.

Jensen says that the transition from old mechanical water meters into smart water meters is gaining momentum as more utilities recognize the benefits–better customer service, an ability to detect leaks in less time, and increased revenue from more accurate water billing–that such a move entails.

The fact that the technology behind smart meters is getting more affordable is helping to quicken the pace of this transition. “There has not been a lot of innovation in the past 50 years or more when it comes to water meters,” says Jensen. “This is changing now because electronic smart water meters are becoming available at the right price level.”

Utilities do face a challenge when they’re determining whether it’s time to upgrade to an AMR/AMI system for the first time or whether they need to update an older system. After all, these systems are not inexpensive. Utilities are cost-conscious today as they continue to make their way through a national economy that though in recovery mode is still frustratingly sluggish.

Jensen, though, says that utilities, if they are willing to invest the upfront dollars needed for a new AMR/AMI system, will soon start seeing significant savings.

AMR/AMI systems help utilities create more revenue through more accurate metering, Jensen says. They also help utility officials identify non-revenue water and cut down on their operational costs. Instead of devoting too many employees to the mundane task of manually reading meters, utilities can instead steer their workers to tasks that are more likely to produce additional revenue, everything from customer-service assignments to analytical work.

Blackwell from Badger Meter says that meter readers can instead test backflows, flush hydrants, turn valves, rebuild meters, and test meters.

“These are the things that help the bottom line of a utility,” says Blackwell. “When AMR and AMI first started out, the manufacturers told the utilities that if they deployed this technology they could get rid of their meter readers. Well, that’s not true. The smarter move–and what most utilities do–is to move these readers to areas in which they are used more effectively.”

Jensen quotes Henry Ford when making the argument for AMR/AMI: “If you always do what you’ve always done, you’ll always get what you’ve always got.” With AMR/AMI systems, utilities can provide better customer service. They can tell their customers exactly when they consume the most water, for instance. Customers can then use this information to change their behavior, cutting down on their monthly water bills. This can pay off when utilities need to seek revenue from their customer base to fund improvements or new services.

“Now is the time to benefit from smart water metering technology,” says Jensen.

Solving Disputes
Consider billing disputes. What do utilities without AMR or AMI do when a customer calls to complain about the size of a water bill? As Blackwell says, utility employees try to talk these clients through the problem.

Unfortunately, this can be difficult if the utility officials are relying solely on the monthly data that their meter readers have collected by hand. But if utility officials have hourly data provided by smart meters and AMI systems? Then they can truly work with their customers to discover why their water bills might have risen.

“I call it the power of hourly data,” says Blackwell. “You need that hourly data to truly serve your customers today.”

Say a customer calls with a complaint about a high bill. Armed with hourly data, utility employees can pinpoint to the hour when the customer’s water usage spiked suddenly. Maybe, if the utility employee can tell the homeowner that his water usage jumped dramatically from 2–6 p.m. on May 30, that customer will remember that he spent that afternoon filling his backyard swimming pool.

Or maybe the utility’s customer service rep will discover a long-term spike in usage lasting a week or more. This might help a homeowner discover that she has two toilets that have been running continuously. Thanks to smart meter technology and the data that it provides, the utility helps such customers pinpoint problems and resolve them.

Utilities can boost their revenue significantly by investing in smart meters and AMI. And this is what manufacturers promote when they are trying to convince wary utilities that an upfront investment in this technology will pay off in the future.

Kamstrup’s Jensen says that a typical utility can increase its revenue by as much as 8% by upgrading to static ultrasonic water meters with a start flow of 0.025 gallons per minute in place of traditional mechanical water meters with start flows of 0.05 gallons per minute or higher. “Every drop counts when it comes to revenue,” says Jensen.

With all these benefits, why haven’t more utilities upgraded to AMR or AMI?

Jensen says that some utilities still aren’t aware of the revenue boost that this technology can provide. Other utilities can’t get over the initial cost of smart meters and AMI systems.

And that’s unfortunate. Because as Jensen has already pointed out, the return-on-investment from upgrading to AMI or AMR systems is impressive.

“They think it is too expensive because they only focus on the investment cost,” says Jensen. “You have to consider the total cost of ownership. This is very important.”

Blackwell says that some utilities prefer to wait before investing in AMI or AMR technology. They figure that automated meter technology is only going to improve in the future. Rather than investing in the technology now, they argue, it makes sense to wait until the technology improves and the cost of it falls.

Blackwell, though, says that this is flawed thinking. AMR and AMI technology can provide utilities with significant savings now. This tech can help utilities boost their annual revenues now. Those utilities that wait, hoping for the tech to become cheaper and even more effective, are costing themselves significant yearly savings now, Blackwell says.

“Don’t wait,” he says. “Don’t do that. Invest in it now; it will pay off. You don’t want to miss out on the benefits of this technology just because you think the price is going to fall sometime in the future. How long are you going to wait before upgrading from a metering system that is outdated?”

Once utilities do upgrade to AMI or AMR technology, the work is far from over. Utility officials must properly train their employees so that these workers know how to properly use their new tech.

After all, utilities won’t enjoy the full array of AMR or AMI benefits–better customer service, improved leak detection, a more efficient operation–unless their workers understand how the technology works. The responsibility for this training typically rests with the utility’s management.

“Look into the business processes within your organization,” says Jensen. “Very often, smart metering solutions introduce new ways of solving problems and new possibilities for working smarter. This means that you will often have to change your business processes to harvest all of the smart-metering benefits.”

The Importance of Recycling
Upgrading to new meters–whether a utility is installing automated meters and an advanced metering infrastructure system for the first time or upgrading from an older automated system to a more advanced one–comes with another challenge, one that municipalities might not at first consider: what do these utilities and municipalities do with the old water meters that they no longer need?

Some municipalities might explore selling their unwanted water meters. But this isn’t always an option. Many of the older meters that utilities and municipalities are recycling can’t be reused by others.

That leaves another good option: recycling.

Several companies across the country recycle old water meters. And this option is a good one for utilities that are upgrading their meters.

Utility Services of the Americas, based in Lancaster, NY, is one company that specializes in recycling old water meters. Steven Snyder, business development director for the company, says that Utility Services of the Americas works closely with utilities, municipalities, installation companies, cooperatives, and consultants to coordinate the recycling of water meters that have reached the end of their useful lives.

It makes sense that utilities would like to sell their used meters if at all possible. The national economy might be in the middle of a slow recovery, but many utilities are still struggling for dollars. They’ll look for any program that could provide them with extra income.

But Snyder still says that he only expects the demand for water meter recycling to increase.

Why? First, a growing a number of utilities are making the move to automated meter reading or advanced metering infrastructure to better serve their customers. This is a trend that is showing few signs of slowing, as experts in the water industry say. By sheer numbers alone, then, more utilities will face the question of what to do with older water meters.

Utility directors, like most government officials, are also looking to operate in a greener fashion. And recycling old water meters is one way to become more environmentally friendly.

Snyder also points to a 2011 amendment to the Safe Drinking Water Act that reduced the acceptable levels of lead allowed in water meters. Many of the meters now being replaced by utilities or municipalities do not meet this new standard. Because of this, utilities can’t sell them for reuse. Instead, utilities must sell them as scrap for recycling.

“For this reason, we expect that we will continue to see a rise in the recycling of these meters as well as other antiquated water-related assets,” he says. “Our approach has always been to provide the most cost-effective and environmentally sustainable approach to the recycling of all obsolete equipment.”

The recycling process is a fairly simple one. As Snyder says, when utilities decide that they want to recycle their unwanted water meters, they first contact Utility Services of the Americas, which will then create a proposal. The price that the company comes up with will vary on a host of factors, including the number of meters that a utility needs to recycle and the age of these devices.

Once the company and the utility agree on a proposal, Utility Services of the Americas will schedule a pick-up for the meters. The company will transport them to one of its facilities to being the recycling process.

“When meters are received at a facility, they are recycled with a zero-landfill policy,” says Snyder. “This means that all metals, glass, plastic, and cardboard or other packaging will be recycled in accordance with all state and federal laws and regulations.”

Workers with Utility Services of the Americas process the meters that arrive as an intact load. They will calculate the final net weight of the utility’s meter recycling load–subtracting skids and boxes–and provide the utility with a certificate of recycling, Snyder says. They also chart and recycle all by-products associated with the water meters. Workers will also document any hazardous materials and dispose of them at an approved certified facility.
About the Author

Dan Rafter

Dan Rafter is a technical writer and frequent contributor.