Tom Adams and Allen Stanbury

April 12, 2002

International Experience 

Australia

Paralleling the approach adopted in the Distribution System Code, a public interest group in Australia called the Public Interest Advocacy Centre argued in a report issued in May 2000 that customers without interval meters should not have to make any contribution to the cost of metering improvements. Their study assumes that small customers will not respond to price. The study suggests that the best way to reduce inter-customer cross-subsidies is to perform load research to do load profiles for customers with different levels of demand. The study does not address the positive externalities of interval meters. Electricity prices in Australia’s electricity market, NEMMCO, are much less volatile than has been demonstrated in North American markets.⁷

Customers selecting Florida Power and Light’s power quality program receive automated notification of power outages and power quality events. At the customer’s cost, Florida Power and Light replaces the existing electromechanical meter with one capable of two-way wireless connection to an automated trouble response system.

The electronic meter will detect and record events such as power outages, monetary interruption, high/low voltage and voltage/current unbalance. The meter automatically notifies the Florida Power and Light trouble system when an event occurs. The trouble call software then notifies the customer by pager, fax or Internet email of the occurrence time and dispatches a trouble crew via wireless communications. The trouble crew can view the details of the trouble and the archived event log, in the truck on the way to the call. Revenues from the new service offering cover the cost of the new metering and wireless communications system.⁸

Customer uptake has been largely small to medium commercial and industrial customers but similar offerings are under active consideration for residential customers.

⁷ See http://www.reggen.vic.gov.au/docs/electric/piacmeter.pdf

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⁸ Conference paper, “One Year Post Deployment: Florida Power & Light’s Implementation of C&I AMR with Power Quality Monitoring”, Ed Malemezian & Ed Brill, Metering Americas 2001.

Florida Power and Light also offers a direct control load shedding program to residential consumers. Participants in the “Residential On-Call” program get two load control transponders installed for free on appliances of their choice. When called these appliances are shut off for no more than an hour a day. Most customers are called only a few days per month.⁹

A participating customer receives a fixed refund of, up to $161 US per year, whether the customer’s load is shed or not. Over 750,000 customers have enrolled in this program. Florida Power and Light also has a “Business On-Call” program and have a total of over 600 MW of load under direct control. Being able to cap demand avoids the need to construct millions dollars worth of generation and reduces fossil-fired emissions at the same time.

Summary

The potential benefits of interval metering to consumers include: improving the customer’s opportunities to avoid price excursions, protecting customers from intra-class cross-subsidies due to the NSLS, increasing the fairness of MPMA customer rebates, helping customers quantify power quality/reliability, and facilitating power quality/reliability monitoring.

The potential benefits of interval meters to the electricity market at large include: reducing the amplitude of price excursions, mitigating potential abuses of market power, and enhancing demand/supply reliability.

The potential benefits of interval meters to society at large include: facilitating greater energy conservation (peaking plants tend to have worst emission profiles) and lower distribution utility capital requirements from fine-tuned transformation requirements.

Analyzing the benefits of advanced meters is complicated by a number of uncertainties. Lifecycle costing of advanced meters is driven by capital cost, Measurement Canada verification requirements, communication costs, and distribution utility operating costs such as dealing with failed communication links. Customer response to future fluctuating prices in Ontario is uncertain.

The value of advanced meters is a function of volatility but forecasting volatility is inherently uncertain.

⁹ http://www.fpl.com/savings/on_call.

Appendix

On March 8, Energy Probe’s presented a summary of our research on interval metering to a meeting of the Ontario Independent Electricity Market Operator’s (IMO) Market Surveillance Panel and representatives of the IMO’s Market Monitoring Unit