Did rules of thumb ever apply in AMR selection?

In years past you may have overheard a comment such as: “If you are communicating to a rural area for the purpose of reading meters, power line communication will be your most cost-effective choice.” Or perhaps: “In an urban setting, radio frequency technology will be the more cost-effective solution.” Until recently, market penetration statistics supported these rules of thumb.

Recent deployments of Echelon’s power line communication (PLC) technology by Enel in Italy, and upcoming deployments of DCSI PLC technology by Pacific Gas & Electricity (PG&E), create a significant shift toward deployment of PLC modules in urban populations. Clearly, a rule of thumb based on population density no longer applies.

AMR selection is complex – but there’s always the hope that a simple comparative chart can support a correct technology choice. As an analogy, consider going online to select a replacement computer. Pick out certain performance criteria required of your new system. Then maybe someone suggests an alternative software application you should run, or even the operating system on which you’d like it to run. Perhaps now you need more memory or a faster processor.

When you have completed these technology choices, you have a system definition that you can shop from one online vendor to another. But in reality it doesn’t work that way. There are always multiple trade-offs, and the various vendors’ offerings are not directly comparable. It could be desktop versus laptop, or weight versus screen size. And don’t ignore battery life. Then there is the largest differentiator of them all – the price tag. Can we expect the selection of an AMR system to be simpler than the choice of a computer?

While the price of an AMI system is many times that of a computer, the decision regarding which one to purchase begins at the same place: Define the requirements.

Defining your requirements is more than a wish list. To reach an optimal choice, the utility must have a clear understanding of the benefits achieved by each requirement. A simple executive statement such as: “We need five minute interval data for all customers” must be put to economic and strategic tests to determine if it is more favourable than a different interval or penetration requirement. Such tests must be applied to each requirement.

Notwithstanding the importance of a business case to support AMI system requirements and the eventual choice of technology, there are some criteria we can use to compare and contrast AMR communication media.

The first challenge the reader must accept in evaluating Table 1 is that there is an exception for every general conclusion. AMDS or Tantalus, for example, may correctly suggest that some rural AMR applications can be costeffectively managed using radio technology. As you read and make judgements regarding the relative accuracy of the comparative comments, you will recognise that it does depend upon the requirement you’ve set in evaluating and making your judgements.

Comparative AMR Criteria

Perhaps a fair conclusion we could agree upon regarding Table 1 is that telephone and fibre are currently not widely chosen as communication media for saturation AMR deployment. OK, some of you may also disagree with that statement – but I’ll bet your disagreement is based on a requirement that is generally difficult to justify on economic terms in a business case.

Much more can be said about each of the comparative criteria shown in Table 1. Perhaps even more might be said of your choice of criteria for comparison. For the first criterion, speed, faster is generally better. It is also likely that higher speed/faster data throughput is more expensive. Speed can provide benefits, including cash flow improvements and process improvements for several revenue cycle services and distribution automation functions. The requirement for speed must be evaluated in the context of “for what benefit and at what cost”.

Comparative criteria for PLC technology

Data reliability is an additional requirement to consider. No communication technology is perfect. If the communication speed does not allow time for a second attempt to retrieve data, then holes will appear in the data set. Certainly VEE (verification, editing and estimating) techniques can be effective, but the preference has to be for as high a reliability index as possible. AMR systems that use the power line as the medium may lose data if they experience a power outage while retrieving data. Radio systems may miss data due to signal interruption as well.

PLC technology can be further evaluated based on alternative techniques used to communicate across the power line. There are pros and cons as well as different cost and benefit matrices associated with each technique. To simply choose a solution without a proper evaluation can lead to a suboptimal decision for a utility. All companies that offer electric service are unique in several ways, and those differences can have an impact on the economic return generated by the technology investment.


Utilities choosing power line technology own the infrastructure over which the communication signals travel. The medium is literally connected to every electric meter the utility needs to read. The integrity of the distribution system is important to the quality of the signal. Variances in signal strength may provide the utility data to proactively improve distribution reliability.

Broadband over power line (BPL) holds the hope of piggybacking on a consumer application for Internet access, allowing the utility to share the infrastructure costs among multiple applications. Therein also lies a risk. Over time consumers (known to be fickle) may change the method by which they access the Internet. The BPL cost might then be supported only by benefits from utility applications.

However; consumer adoption of alternative Internet access technology may play out less aggressively in more rural parts of the country. New technology entering the rural market must meet its own investment criteria, perhaps without utility applications to assist the financial result. If BPL economics ‘work’ for the rural environment, Internet access through BPL may be a consumer application for many years. Will it be enough years to cover the infrastructure costs? Mesh networks, a new development in radio technology, have proven effective for public safety communications and hold promise of high reliability and coverage. One important issue in radio technology is licensed versus unlicenced frequency. Some suggest that modules operating in an unlicensed frequency will be subjected to increasing interference.

In the US, a recent Notice of Proposed Rulemaking (NOPR) by the Federal Communications Commission (FCC) raised concerns that licensed uses may begin interfering with the unlicensed 902-928 MHz band. At this writing a rule has not been finalised. Similarly threatening NOPRs in this band have been successfully resolved in the past. There are now significantly more devices installed, suggesting that the issue will again be resolved acceptably.

Is a licensed frequency protected from similar challenges? Licence rules prohibit interference, though it does happen and requires attention. But vendors are not immune from requirements to make product modifications or even replacements. As an example, technology advances have made it possible to reduce channel bandwidth and increase utilisation of the spectrum. The FCC in the last decade has taken action to ‘re-farm’ frequency allocations to reduce channel bandwidth. Such actions could at a minimum require new product development with its associated cost, or require users to replace existing licensed technology.

It is difficult to use any single criterion as the differentiator between solutions. It truly does come down to defining requirements and evaluating how they can be most costeffectively met. Care must be exercised to avoid setting requirements that constrain the overall solution, such as requiring a single communication technology for all meters, or excessive data delivery volumes ‘just in case’. It is appropriate to seek to reduce risk. Depending upon the requirements, hybrid solutions may play a central role in bringing back data cost-effectively to the utility’s meter data management system. The PG&E decision is a case in point – two technologies will be used in PG&Es service territory: radio for gas services and power line for electric services.

When evaluating the choice of technology, all utilities must be driven by requirements and by economics, with an eye out for strategic concerns.