Role of Systems Integrator in Smart Metering Implementation

Transcription

1 Role of Systems Integrator in Smart Metering Implementation Bebin Thomas

2 TABLE OF CONTENTS Introduction...3 Smart Metering Market Facts...4 Smart Metering Implementation Key Focus Areas...5 Role of System Integrator...6 Conclusion...11 Appendix...12 References...12 About the Author... 12

3 Smart Metering has become the latest buzzword world over for all, including Governments, Utilities and Regulators owing to significant benefits achieved by its implementation. Due to continuously evolving technology and lack of global standards, there lie immense challenges in Smart Metering Implementation for System Integrators. This white paper focuses on various implementation challenges faced by System Integrators (SI) in terms of choosing right technology, processes and approach owing to constraints in cost, market structure and size of Utilities.. Introduction Today, Smart Metering is no more an if but a when. Governments, Utilities and Regulators world over understand the benefits they may get with Smart Metering implementation. An efficient implementation of Smart Metering can transform the Utility to an entirely new, higher plateau of business performance and in order to achieve this, IT Systems Integrator (SI) play a pivotal role. Studies show that as many as 80% of projects fail to meet their technical, cost, or schedule objectives. Some 30% of projects are cancelled and approximately 50% exceed their original cost estimates. Advanced Metering Infrastructure (AMI) programs are not immune from these metrics. This white paper outlines the current smart metering market position, key focus area and typical role of an SI in implementing a Smart Metering Solution. 3

4 Smart Metering Market Facts Smart Metering Market Facts The Smart Metering subset is expected to show a much healthier 24% CAGR through Smart Metering would experience a 24% annual growth rate through (Although world markets for electric, water and gas meters are increasing at a compound annual growth rate (CAGR) of only 2%) By year 2013, 28% of electric meters are expected to be "smart." Figure 1: Findings from ABI Research Following graphs show the Smart Metering implementation growth in Europe & in the US from 2006 through 2012 and Smart Meters installation and expected evolution in Electricity sector in Europe. In such a rapidly growing AMI market, SI s play a pivotal role in Smart Metering implementation. Before we see the various roles that an SI can play, let us see the key focus areas for an SI during a Smart Metering implementation. 4

5 Smart Metering Implementation Key Focus Areas Due to the evolving nature of AMI Technology and Mergers & Acquisitions within Utilities, SI's face an ever increasing challenging situation in any Smart Metering implementation. Utilities expect SI's to have vertical industry experience where in the SI has complete knowledge of the industry, local/federal regulations, market trends and solutions. It is very essential that an optimal program approach is taken for any Smart Metering implementation. The key areas where SI's should focus are Business Process Assessment, Technology Assessment, Solution Implementation and Benefits Realization Business Process Assessment: AMI will fail if Smart Meters and Smart System are implemented without Smart Processes to support them. Hence it is essential to assess the existing business processes, gaps and AMI regulatory requirements before arriving at a TO-BE Business process. Technology Assessment: Technology in AMI is still evolving and arguably in infancy stage. Therefore selecting the right technology is a big challenge for any SI. Choosing the right vendor for metering products, Meter Data Management (MDM) solution, communication network and softwares for integrating the various IT systems is very important. Solution Implementation: Solution Implementation strategy would be different for different Utilities. A smaller Utility may opt for SaaS Solution. A larger Utility may first want to go for Pilot implementation to verify the proposed business benefits before taking a Big-Bang approach. Benefits Realization: What next once Smart Meters, Smart Systems and Smart Processes are put in place? Utilities would then like to see the ROI of their colossal investments in Smart Metering. Smart Metering implementation promises a lot of benefits to the Utility. The ultimate success of an SI depends on the Benefits Realization which it can offer to the Utility through their implementation. 5

6 Role of System Integrator Today Systems Integrators are capable of playing a wide spectrum role in Smart Metering implementation. With their vertical industry knowledge they position themselves as an expert. Utilities may want SI s to not only focus on Assessment, Solution Implementation and Benefits Realization; they may also want them to play an imperative role in the Business Case Development. Typically SI s would perform following roles in any Smart Metering Implementation. Business Case Development: Business case for a Smart Metering implementation is quite well established. Everybody understands the benefits of transformation from a dumb to a smart grid. However, if a Utility engages an SI for Business Case Development, the prime focus for an SI should be to identify the key drivers and challenges of the Utility for Smart Metering implementation and ascertain a roadmap with clear visibility of Benefits Realization. Once the Business Case and funding for the proposal is approved by the Utility, it s time for the SI to walk the talk! Assessment: before the Utility. A detailed Business Process and Technology Assessments are required before the Solution options are placed Business Process Assessment: SI should carry out a detailed study of the existing business process and plot the AS-IS Business Process Map. Some of the Utilities may already have the AS-IS Business Process Map. In such case SI should verify the AS-IS process before taking the next steps. A To-Be Business Process Map should be plotted based on the Utility requirements, features of the products selected and industry best practices to arrive at the Gaps. SI should keenly focus on ensuring that the Gaps are filled as they implement the solution as it is a very essential parameter measured during Benefits Realization. Technology Assessment: Success of an AMI program largely depends on the technology assessment, which includes selecting the right products, fit for purpose, from a vendor who has strong market credentials. Technology assessment should mainly include a feasibility study of the product against the Utility requirements. Currently, there is no universally adopted AMI specification. Hence, the functionality that is required within the AMI solution needs to be carefully defined by the SI. Following are the basic requirements of an AMI Solution which an SI should evaluate during the Technology Assessment. 6

7 An Interoperable Solution with open standard technology for interfaces and data to prevent the solution from being locked into a single vendor. A Secure Metering Solution which can ensure protection of customers personal information in accordance with the legal and regulatory requirements. A secure, open standard, scalable two-way communication network for data exchange. A remotely programmable and controllable meter having the ability to remotely energize/de-energize, upgrade the metering settings, firmware which should be reversible if not successful and can operate in both credit and debit mode. Meter which is capable of recording demand and usage over configurable time periods enable Time of Use metering and can record bidirectional energy flow so that customers are encouraged for micro-generation or distributed generation. Meter with the ability to store data for a configurable duration for any diagnostic purpose, can self locate using GPS and can act as a gateway for devices connected to the meter at customer end. An AMI Solution with robust network management capabilities having the ability to remotely diagnose meters, network components and detect & repair (Self Healing) network problems. An intelligent AMI solution where it can detect outages, can detect theft or tampering of meter. An MDM Solution which is capable of furnishing following data requirements for different market players. Parties Involved Use of Data DSO (Systems Operator) Supplier Generation (distributed) Customer Third Party (ESCOs) Government Body or Regulators Grid operation, billing, forecast, loss detection, customer service, process automation, customer switching, power quality monitoring Billing, Tendering, Forecast, Trading Plant operation Decision making Energy efficiency measures, Input to home and building automation Power quality monitoring, Statistics Table 1: Application of data obtained by MDM solution As part of the Technology Assessment being done for the solution provided by vendor, a thorough Vendor Assessment is also required about their credentials like market presence of their product, total cost of ownership, integration ease, future offerings from the vendor and most importantly, their delivery capabilities. 7

8 Solution Implementation: Implementation Approach aspects of Solution Delivery are two important aspects of Solution Implementation Implementation Approach would primarily depend on the Utility requirement and to some extent the size in terms of customer base of the Utility too. Implementation Approach options should be given due consideration and should be discussed with the Utility before finalizing the recommended approach. 8

9 Solution Delivery: is another important aspect of Solution Implementation which includes System Engineering, Testing and Management. 9

10 Deployment: Deployment of Smart Metering Program is very different and challenging from any other Utility systems integration program. This is mainly attributed to its complexity. Three main challenges in Smart Metering deployment are given below. Benefits Realization: What after Smart meters, Smart Systems and Smart Processes are deployed? Utility would want to evaluate the ROI which the SI had shown during the Business Case Development. Benefits Realization primarily depends on how rightly the solution was implemented for the Utility. SI should also be providing solutions for continuous improvement for the Utility and show them a clear path for reaping more benefits. 10

11 Conclusion Smart Metering implementation definitely is not One Size Fits All. Hence, such implementation requires a lot of due diligence so as to arrive at an acceptable and customized roadmap. A few utilities may opt for some services under SaaS model. Due to the colossal investment cost associated with such a program, a Pilot implementation would be a good fit in today s scenario so that the performance, customer satisfaction and ROI can be measured faster and learning from the last implementation can be put in the next implementation. Political Leaders world over are worried about the energy losses and global warming. They see Smart Metering implementation as one step in the movement towards minimizing energy losses, which opens up an ocean of opportunities for Smart Metering System Integrators. 11

12 Appendix References [2007]. Factiva, Accenture Research analysis. Smart metering in the Energy and Utilities Sector, Datamonitor. [2007]. ERGEG. Smart Metering with a Focus on Electricity Regulation. [2008]. Ketchledge, James. Electric Energy T&D Magazine. Challenges of Implementing AMI. Gentry, Malinda; Lich, Joshua. Advanced Metering Infrastructure: The Case for Transformation, Utilities Project. Utility AMI High-Level Requirements Revision 2.7 About the Author Bebin Thomas is a Senior Consultant working with Wipro s Energy & Utilities Domain consulting group. He has been a part of various large Systems Integration programs in WAM & CIS domain. He can be reached at bebin.thomas@wipro.com. 12

13 ABOUT Wipro is the first PCMM Level 5 and SEI CMMi Level 5 certified IT Services Company globally. Wipro provides comprehensive IT solutions and services (including systems integration, IS outsourcing, package implementation, software application development and maintenance) and Research & Development services (hardware and software design, development and implementation) to corporations globally. Wipro's unique value proposition is further delivered through our pioneering Offshore Outsourcing Model and stringent Quality Processes of SEI and Six Sigma. ABOUT WIPRO COUNCIL FOR INDUSTRY RESEARCH The Wipro Council for Industry Research comprising of domain and technology experts from the organization aims to address the needs of customers by specifically looking at innovative strategies that will help them gain competitive advantage in the market. The Council in collaboration with leading academic institutions and industry bodies studies market trends to equip organizations with insights that facilitate their IT and business strategies For more information please visit