Utilities Progressively Move Toward Automation Programs to Boost Reliability

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Utilities Progressively Move Toward Automation Programs to Boost Reliability

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Thursday, June 23, 2016 - 4:00pm

CAMPAIGN: Smart City/Smart Utility

CONTENT: Article

Old and obsolete equipment and lack of integration of automation into the overall enterprise – coupled with reliability mandates – have created an environment ripe for the adoption of distribution automation and advanced metering infrastructure (AMI) programs for utilities.

Some 62 percent of utilities responding to Black & Veatch’s 2016 Strategic Directions: Smart City/Smart Utility report said they are approaching automation implementation as a series of projects – as opposed to isolated projects. Utilities are realizing that automation projects cannot be isolated projects, but instead are almost always part of larger utility automation initiative.

“Utilities are feeling pressure from their customers and regulators to increase reliability while at the same time reducing or at least minimizing the increase in costs,” said Curtis Johnson, Utility Automation Director for Black & Veatch’s telecommunications business. “These two seemingly conflicting goals can only be achieved through the implementation of advanced data collection and automated applications.”

Using a Roadmap to Guide Implementation

Given the integrated nature of these automation projects, it is critical for utilities to develop a strategy on how to transform their organizations, Johnson said. Almost 40 percent of respondents are working from roadmaps that were shared with regulators. Similarly, 31 percent have created a telecommunications master plan to guide their initiatives.

“Utilities in the process of implementation are hoping to solve both operations and planning challenges while their core business undergoes a transition,” Johnson said.

Utilities in California, Hawaii and New England are leading the industry in preparation for automation with increased penetration of distributed energy resources, he said.

Financial Incentives for Automation Programs

Andy Colman, Director of Black & Veatch’s Integrated Solutions consulting practice, said that collecting data from utility assets has become easier and less expensive. As technology advances and the integration and operational costs for using the advanced technologies decline, an increasing number of utilities are implementing data gathering and automation programs.

Yet from a financial perspective, nearly half of utilities implementing automation programs are doing so only when there is a positive business case to support the investments. Return on investment can come from either cost reductions in excess of investment or from regulatory approval to recover the investment through rates.

To a lesser extent, automation is being added as old and obsolete equipment is being replaced, according to the survey. Motivators also include regulator-led reliability performance mechanisms, where the case for investment may boil down to punitive measures for poor reliability.

“Fewer utilities are implementing enterprise-wide automation programs where they are not mandated or there is not a positive return on investment, as these programs fight for limited resources,” Colman noted.

Combining Data with Different Types of Automation Programs

The value of the data and monitoring/control capabilities captured from automation programs will help to make the case for investment, he said. More advanced utilities have begun to combine AMI data with other operational data stores for long-term planning.

When asked about existing automation systems, nearly three-fourths of electric utilities and about two-thirds of water and natural gas utilities have SCADA systems. This is anticipated since SCADA is a mature technology and has been around in various forms for more than 50 years.

Following closely are outage management systems (OMS) and energy management systems (EMS). Falling off to below 50 percent are newer technologies such as fault location isolation and service restoration (FLISR), volt/VAR optimization (VVO) and distributed energy resources (DER).

“These lesser technology implementations will grow as the technology platforms and software solutions become more mature, the business cases are proven, and older distribution operations systems are retired or mandated by regulators,” Colman said.

Johnson added that the value of these projects is enhanced by the integration of the data and systems into a cohesive enterprise automation platform.

“We believe that the utility industry is on a march toward increased automation,” Johnson said. “As the capabilities increase, and operational improvements and customer service enhancements are proven, utilities will move forward to becoming increasingly smart utilities.”

Keywords: Technology | Black & Veatch | Business & Trade | Business Surveys | Energy | Finance & Socially Responsible Investment | Reports | Utilities

CAMPAIGN: Smart City/Smart Utility

CONTENT: Article