Washington, DC, U.S.A. --- (METERING.COM) --- December 19, 2007 - Utilities and their regulators must develop a common vision of how AMI will morph to lay the groundwork for the smart grid revolution to come, the Utilities Telecom Council (UTC) says in a new research report, “AMI: Smart metering meets the smart grid.”

For many utilities smart grid business cases have been a long time in the making, emanating largely from 15-20 year efforts to justify the economics of AMR. Indeed, while the terminology and technology have evolved, AMR is still the anchor benefit in all smart grid analyses, with digital meter functionality and the associated communications infrastructure to enable it the largest two investment costs that must be recovered in the utility’s rate base.

However, the intelligent grid is not the same for every utility, because each one has different circumstances that will result in different solutions. Utilities should prepare by examining plausible scenarios, perhaps in five-year increments, and then extend these scenarios 15 or 20 years out. While no method can perfectly predict the future, a realistic smart grid roadmap can be developed by building a flexible, standards-based communications and networking platform and developing plausible scenarios that leave management with a “no regrets” feeling.

The UTC says the prospects for new technology have never been brighter and that technology stands poised to transform the physical operation and functional capability of utilities to bring them fully into the digital age. Marrying the electrical distribution infrastructure with a communications infrastructure in the form of a number of communication technologies – two-way radio frequency (RF), broadband over power line (BPL), power line carrier (PLC), cellular or WiMAx – will create an intelligent grid, focusing primarily on the efficient, reliable and safe distribution of electricity, with data more readily accessible for operational, maintenance and planning decisions.

Broader smart grid transformations leverage AMI and seek one or more distribution-centric advancements including grid reliability and security, demand response, distributed energy resource integration, distribution automation, energy efficiency and home automation. These advances trigger some incredibly information-intensive innovations that will require thoughtful technology implementation. Meter data management (MDM) and the use of analytics that make sense of data for use in operations is badly needed, and comprehensive and successful smart grid implementations will need well thought out solutions for these areas.

The UTC comments that the need for a fair return on investment is obvious and the regulatory dialog should focus on an integrated smart grid that accommodates new technologies for both grid and customer functionality. The case for rate recovery that must be agreed between utilities and their public service commissions is more complex than anything that has come before. Utilities should work with commissions to help them understand the need to pursue benefits beyond the obvious metering and distribution benefits, and should partner with legislators to align the collective stakeholders with the full view of both tangible and social benefits.