• Ashley Maistry

• Smart Grid Delivery Lead

• Accenture

• South Africa

Accenture Fast Facts

• Global workforce of 319 000 employees.

• Largest and most diversified group of technology and outsourcing

professionals in the world.

• Generated net revenues of US$30.0 billion for the fiscal year ended 31

August 2014.

• Clients include 91 of the Fortune Global 100 and more than three

quarters of the Fortune Global 500.

• 99 of our top 100 clients in fiscal year 2013, based on revenue, have been

clients for at least five years, and 92 have been clients for at least 10

years.

Accenture Utilities Industry Group – at a

glance

• Aging water and electricity supply

infrastructure

• Limited capital investment to address

infrastructure upgrades

• Non-compliance to revenue collection

procedures resulting in:

o Increasing bad debt

o Increased arrears

• Vandalism of supply of water and

electricity infrastructure

• Theft of water and electricity (both water

and electricity)

Typical Utility/Municipality Issues

Revenue Protection – Using AMI

technology as a Silver Bullet?

Meters

Local Area

Network (LAN)

Data Concentrator

Wide Area

Network (WAN)

Master Station

Endpoint Devices

Meters Communications Infrastructure

Billing

Determinants

Generation

CIS

Customer

Interface

Demand

Response

Mgmt

Outage

Mgmt

Distribution

Planning &

Operation Load

Forecast

&

Settlement

Install.

&

Maint.

Revenue

Protection

Load

Forecasting

& Settlement

System

Demand

Response

Mgmt

System

Asset Mgmt

& Install. Planning;

Field Order Mgmt

Systems

GIS;

Field

Order

Mgmt

System

Outage

Mgmt

System

Meter Data

Repository

MDMS & Analytics

Meter Data Management System

Premise Equipment

Back office

Utility Back Office

Applications

Customer Channels

Services

AMI Benefits Case – Typical benefits tree

Cost Reduction

Revenue Enhancement

Reliability Improvement

Customer Relations Enhancement

Customer Insight

Financial

Customer Service

Load Shift Savings (DR, Avoided Peak rate TOU tariffs from Eskom – bulk City supply)

Asset Maint./Ops Savings (Outages/Voltage/Under-frequency)

Meter Reading Savings (Automated Meter Reading)

Process Improvement (Billing Issues Resolution, improved customer service, accurate billing)

Non-Technical Loss Savings (Theft, tampers, etc.)

Load Shift Savings - Enabler of TOU, Critical Peak Pricing, etc.)

Timely and accurate bills

Call & Walk-in centre savings (Maint., Call Center, Billing

Improved Customer Service (Maintenance, Call Center, Billing Issues*)

Strategic Enabler of the future Network

Enabler of the Smart City/Grid

Network

Enabler of the future needs of the City

Network Control/Grid Control

Technical Loss Savings (Efficiencies and self-healing from “self-aware” network; Reduction in Network Leakages)

Enabler for Cust. to import/export energy (PV, Wind, PHEV, etc.)

Regulated Support

Environmental Stewardship

Regulatory Optimized Power Supply and Demand planning

Customer Conservation Enablement through behavioral savings (energy efficiency)

Meet the Electricity Regulatory Acts requirement (#773)

Connect/ Disconnect Savings (from manual to remote)

The business case is difficult to realise for the following

reasons:

• Significant capital commitment

• Procurement and Contract Management

• Technical component complexity

• Human capacity

• Systems Integration complexity

• Meter to Cash operations

Risk Assessment

Required Business Outcomes enabled by AMI/Smart Metering as a Service

Example of typical AMI Benefits mapped to

Business Outcomes

Options – Investment Decision

Municipality

• Utility/Municipality procured

and owned meters

• AMI systems and operations

provided as a service

• Managed through SLA /

Business Outcomes Service

Field Devices

Option 2

AMI systems

Municipality

• Utility procured and

owned meters

• AMI systems procured

and owned by

Utility/Municipality

• Internal SLA / Business

Outcomes Services

Field Devices

Option 1

AMI Systems

• Full AMI as a Service

owned by Service

Provider

• Rollout by Service

Provider

• Full capability provided as

a business service

Field Devices

Option 3

AMI Systems

Options – Investment Decision

Municipality

• Utility/Municipality procured

and owned meters

• AMI systems and operations

provided as a service

• Managed through SLA /

Business Outcomes Service

Field Devices

Option 2

AMI systems

Municipality

• Utility procured and

owned meters

• AMI systems procured

and owned by

Utility/Municipality

• Internal SLA / Business

Outcomes Services

Field Devices

Option 1

AMI Systems

• Full AMI as a Service

owned by Service

Provider

• Rollout by Service

Provider

• Full capability provided as

a business service

Field Devices

Option 3

AMI Systems

Options – Investment Decision

Municipality

• Utility/Municipality procured

and owned meters

• AMI systems and operations

provided as a service

• Managed through SLA /

Business Outcomes Service

Field Devices

Option 2

AMI systems

Municipality

• Utility procured and

owned meters

• AMI systems procured

and owned by

Utility/Municipality

• Internal SLA / Business

Outcomes Services

Field Devices

Option 1

AMI Systems

• Full AMI as a Service

owned by Service

Provider

• Rollout by Service

Provider

• Full capability provided as

a business service

Field Devices

Option 3

AMI Systems

Purchase Model options: Traditional vs. As-a-

Service Traditional (Buy, Own and Manage) As-a-Service (Buy a Service)

• Utility earns all (the total) the benefits amount accrued from the AMI implementation

• Utility acquires capital assets/ AMI solution: Smart meters, telecommunications infrastructure, multi-vendor master station, meter data management system. Provides opportunity to build “best of breed” solution.

• Provides the opportunity to build in-house skills in distribution management (e.g. Smart Metering, Operations Centre, etc.) technologies

• Capital cost avoidance – Utilities can purchase a monthly service to avoid capital outlay.

• Possibly more suitable for smaller utilities as they may not have the capability to undertake the AMI project in-house, in terms of: Finance and Skills as compared to the larger metros.

• Speed to Market: AMI as a Service can be implemented faster than the traditional in-house .

• Provides the ability to negotiate and performance credits into an SLA.

• Technology and procedural upgrades can be easily accomplished while abstracted in terms of risk

• Requires a significant upfront investment in meters and technology

• Difficult to implement and manage KPIs without specialised skills and experience.

• AMI solutions come with inherent risks that traditional or smaller utilities may not have in order to manage as they are not aligned to the utility’s core business: o Resourcing of a Smart Operations Centre (SMOC) o Management of communications network o Automating traditional manual process to support high volumes o Lack of integration or Business Process Management (BPM). o Unclear Information Technology (IT) governance and

standardisation.

• Large utilities unwilling to consider large technology deployments without acquiring capital assets.

• Pre-engineered system with “out of the box” functionality preventing the ability for customisation with respect to internal business processes/requirements.

• Software and hardware pre-selected by the service provider can result in vendor lock-in: Smart meters, telecommunications infrastructure, multi-vendor master station, meter data management system

• Pre-negotiated prices promotes inflexibility to control operation costs.

Pro

s C

on

s

Financial Summary – Buy the Technology

or buy a Service? Financial & Risk Transfer

AMI as a Service Base Case

Financial & Operational Risk Transfer

How do you choose an AMI-as-a-Service

provider?

How do you choose an AMI-as-a-Service

provider?

Mitigating risk and deriving value from

AMI as a Service (1/3) Selecting a single Smart Metering Service Provider who will coordinate

activities of financiers, meter vendors, field installation teams, customer

communication and systems integration:

1. Financial stability – The “AMI as a Service” provider must be able to

support funding for approximately millions to billions, reducing over a 5-10

year period

2. Meter supply – The AMI as a Service provider must be able to source

meters according to local policy (standards and supplier localisation

requirements)

3. The AMI as a Service must have experience of overall Programme

management office including:

– experience of a complex mass rollout campaign of at least 250 000

meters.

– managing multiple work-streams within an integrated programme

management office.

Mitigating risk and deriving value from

AMI as a Service (2/3) 4. Programme management office for the installation teams, including use of

a mobile workforce management solution to improve speed, installation

quality and data quality

5. A significant amount of Process design including time of use tariff

programming (Credit and Prepaid), customer interaction, meter reading

with integration to billing, routing work requests for alarms and event

triggers, second line support for smart metering field devices and

telecommunications, load shift rules, credit management disconnect and

reconnect. The cascading impact of Change management based on the

new processes including training must be provided

6. System integration of the technical components - the network, new

systems operations, data flows, billing rules, middleware, meter data

management system, analytics using “big smart metering data” to enable

savings in maintenance work and to provide insight into electricity and

water balancing at the distribution level to reduce technical and non-

technical losses

Mitigating risk and deriving value from

AMI as a Service (3/3) 7. Customer acceptance based on a communication campaign using previous

experience of understanding the impact of AMI on customer perception,

behaviour and acceptance of the new Smart Metering infrastructure.

8. Political support based on local economic development, including the

AMI as a Service provider of the full service having local presence / office,

SA job creation from meter assembly, field installation, skills development,

marketing, on-going smart meter operations support from a local office

sourced from local citizens or local staff with a skills development plan

Questions and Close