PPL Electric Utilities

presentation

AMR Lessons Learned Anthony M. Osmanski

March 30, 2004

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AMR at PPL Electric Utilities

Anthony Osmanski,Technical Support Manager- AMR, PPL Electric Utilities Reports to the Director of AMR - PPL EU 30 years electric utility experience in metering operations led technical implementation led the AMR Technology investigation stages led the DCSI proof of concept tests

How significant is an AMR project to a utility?

AMR is the 3rd largest contract a utility will ever undertake, only buying a utility or building a production facility have a larger scope and impact on customers, employees and others!

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PPL Electric Utilities Service Area

Harrisburg

Williamsport

Lancaster

Scranton

Williamsport

Hazleton

Wilkes-Barre

Allentown

Bethlehem

50 0 50 100 Miles

N

EW

S

Meters per Square Mile> 225 > 75 and < 225 <75

PPL Corp. Facts

1. $5.2 billion revenue

2. $11.8 billion assets

3. 10,000 sq. mi.

4. 1.3 M electric meters

5. 6 major cities- 50% of customers

6. Diverse environment

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How was the metering automation proposal justified?

1. What’s the corporate strategy- how can automating meter reading best meet the corporate strategy

2. Four phases: plan, business case, buy, implement3 Focus on primary benefits 4. ‘Strategic Value’ perception5. Adjusting attitude on ‘Risk Management’

- does 1,000,000 x 1 = 1 x 1,000,000?

A successful business case: 1. 45% business case2. 45% ‘managing’ 3. 10% technology

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PPL Project overview

Customers: 1.3 million meters Financial - NPV, EPS, ~5 year payback Meters: single phase and 3 phase with 66% meter reuse

DCSI: all 1 and 3 phase meters except VT/PT connected meters Comverge for VT/PT connected meters

Uses: billing, call center, special reads, etc. Schedule: 36 months Data:

hourly interval data delivered every 8 hours 15-minute interval delivered every 2 hours daily consumption and demand

Roles: PPL: customer, field installation, IT integration, 3 phase meter retrofit DCSI: All residential and commercial customers, deployment,retrofits Comverge: major revenue customers

PPL’s strategy is knowledge centric100% of the customers - no 2nd class customers

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The TWACS system will provide hourly data for 1 and 3 phase meters every day and support other services.

CSS

Client Workstations

(PC)

SCADA, EMS, OMS

Others

Communications Server

DistributionSubstation

Telecommunications Link

PowerLines

Substation Control Equipment

ServiceDrop

PPL Net

Meter Retrofitted with Module

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Allentown

Oxford

PPL Electric UtilitiesPPL Gas Utilities

The Comverge system will provide 15 minute Load Profile data for 3 phase VT meters every day and support other services.

To PPL Data Center

CDMA -Verizon Wireless

MainGateTM C&I

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PPL Business Case Model

3 Major Business Case Parts• Finance: NPV, EPS, ROI …• AMR deployment plan geo-map• Risk Management Plan

Financial Model Analyzed:• 48 customer groups by OpCenter• 15 primary benefit groups• 40+ cost groups• concurrent AMR strategy review• up to 3 technologies/strategy• sensitivity to assumption changes

Benefits• reduced risk, cost and time• proven model accepted by finance• supports benefit tracking

Customer SegmentationCustomer

Segmentation

Vendor PricesVendor Prices

Utility AMR Performance Needs

Utility AMR Performance Needs

Benefit Model:Cost and Benefit

Assumptions

Benefit Model:Cost and Benefit

Assumptions

Financial Model Financial Model

Deployment Issues

Deployment Issues

Non-Vendor PricesNon-Vendor Prices

Corporate AssumptionsCorporate

Assumptions

Business Case Report Finance, Deployment,

Risk Management

Business Case Report Finance, Deployment,

Risk Management

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PPL selected a joint program committee strategy to ensure that its vendor-partners were aware of and committed to creating the benefits in a timely manner.

Co-ChairProgram Managers

NetworkDeployTeam

MeterShopTeam

ITIntegration

Team..….

Project ManagersDeployment,Change Mgmt,

Operations, Technology

ExecutiveManagement

PROGRAM MANAGERS Total program responsibility Goal setting Motivation Track program status Reporting Communication Settle major conflicts Manage budget

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PPL’s team manages 100s of program activities to ensure effective, timely deployment consistent with maximizing benefits.

Process planning Change management plan Responsibility matrix Schedule IBEW work plan FAT, SAT and CAT processes e.g. Comverge CDMA units Technology processes Deployment processes Hard to access Regulatory Training Legacy interface etc

Do not underestimate the uncertainty of change or its differing impacts on people!

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PPL’s overall deployment is going successfully.

~1.25 Million operational AMR meters as of March 1st >99% of all operational meters read every day deploying 4,000 meters per day averaging over 60 meters per exchanger deployment will be completed by Sept. 2004

Eliminated major meter reading issues hard to access meters of every type no problem reading meters in underground distribution areas works well in Network Meter settings

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PPL’s Lessons Learned

Technology Selection Match utility needs with technology infrastructure and operation Define parameters necessary for cost effective selection Don’t forget obsolescence i.e. retrofitting D2/3 or I-50 meters for example.

– Vectron vs. S4 decision at PPL

Understand the Technology Beware of market pressures to sell. Don’t be oversold by marketing hype, understand the limits of the technology Make sure the vendor understands what you are asking for before its too

late. Expect surprises. “Oh you wanted it to work THAT WAY?”

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PPL’s Lessons Learned

Information Technology (IT) Create a dedicated team early Make them a part of the decision and selection Get a jump on processes. Don’t wait until after contract signing to begin IT

process review Change Management

Manage Change Identify all the processes that will be touched. Understand and define today’s processes and how will it change with AMR Expect “Push Back” from most on Change management. “no time for this

stuff, I have an AMR System to install”

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PPL’s Lessons Learned

Sound Processes Understand your processes and eliminate confusion Confusion stops or delays efficient work Confusion creates excuses for delays Never stop work, start-up inertia is deadly in AMR Projects

Human Nature Factor Human Nature will breed negative criticism Employees promote negative rumors Kill negative comments with positive news alerts or information updates. Rumor Control is important to keeping a positive spin on AMR deployment Problems occurs with every new system, keep them under control

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PPL’s Lessons Learned

Apathy The initial work and process may go well because it has attention Be careful as you progress into the project to maintain focus Excitement wears off and apathy sets it down the road Have controls and monitor, monitor, monitor. (statistics, performance)

Do-Over factor Problems tend to be overshadowed by schedule Don’t rush to conclusions on problems or concerns Fixing the symptom rather than the cause will require do overs. And over and over and over

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PPL’s Lessons Learned

80/20 rule reaches AMR easily Problems at particular sites can overshadow the overall process Keep focused on the big picture One meter not communicating is a limited concern 10,000 meters not communicating may have a similar failure mode that

needs to be addressed. Don’t spend 80% of your time on a few concerns. Monitor the total

environment 1 million process done once is not equal to 1 process done 1 million

times over. Installing 1 million AMR meters should be the same process done right over

and over. Have a simple error free process that covers all contingencies.

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PPL’s Lessons Learned

Deployment Process Rule #1 KNOW WHERE YOUR METERS ARE AT ALL TIMES Automate the meter exchanges, handheld processors etc downloaded daily Update the population file nightly

Maintain adequate inventory Have enough meters to maintain the deployment schedule Make sure you have every type required Filling in the missed holes is costly Seasons of the year is a major factor, Bad weather slows you down but don’t forget good weather speeds things

up. Don’t run out of meters in good weather times.

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PPL’s Lessons Learned

Small Scale Start-up Do a slow start Exercise your processes Do test billing Check technology Make adjustments before proceeding PAUSE

Large Scale Shut -down Have a plan for the end of deployment Turn-over to the business- are they ready All new processes signed off and accepted Operational plans in order

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PPL’s Lessons Learned

Devil is in the Detail Ralph Amato- among others

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How does PPL’s experience match up to expectations?

Item Match UP

Business case

Implementation Plan

IT plan

Communication plan

New internal benefits - had no goal

New revenue opportunities - had no goal

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For more information: Anthony Osmanski

– PPL Electric Utilities– 484.634.3024– amosmanski@pplweb.com

AMR

Project

Plan