NEW YORK-Electric utilities are taking a close look at wireless communications as a means to enhance revenues and operating efficiencies in their recently deregulated and competitive business environment.
A variety of wireless opportunities and applications are under review or newly in use among electric power companies, including: communications between service personnel in the field and company headquarters; automatic meter reading for demand-side and supply-side load management, and monitoring of conditions on long-distance transmission lines.
Additionally, electric utilities are exploring means by which they might abet wireless communications providers-by means that include leasing the valuable tower space they already own and control, by providing the back-office billing and customer service operations they already perform for their own customers, and by loaning out their repair people.
Furthermore, electric power companies also are exploring ways to become involved in the wireless communications industry itself. Some regional electric utilities formed alliances with various bidders in the recently completed Federal Communications Commission C-block auction for personal communications services, said Woody Ritchie, senior director of sales and operations for Motorola Inc.’s Cellular Infrastructure Group, Arlington Heights, Ill. Others are lining up to bid in the D- and E-block auctions.
PECO Energy, formerly known as Philadelphia Electric Co., is one example of a utility that “has become active in the telecommunications field, involved in licensing ventures, buying consortiums and other lucrative opportunities that expand beyond its core competencies,” Ritchie said. Another is Texas Utilities Co., which has joined PrimeCo Personal Communications L.P.’s PCS alliance to build a PCS system in Texas.
This spring, PECO joined AT&T Wireless PCS Inc. as a minority partner in a joint venture to build a digital wireless phone system serving a 37-county area around Philadelphia. Part of its contribution is to let AT&T use PECO’s transmission towers and buildings as PCS antenna sites.
Utilities may wish to retain their own in-house radio maintenance staff, perhaps enhancing the value of such employees by contracting out their services to other types of wireless carriers.
The next wave of wireless applications for electric power companies is in providing information feedback loops between individual customers and utilities as an alternative to the traditional meter, whose technology is a century old.
Based on a polling of utility members, the Electric Power Research Institute in Palo Alto, Calif., plans soon to launch “our third year of research into wireless communications-the technology, the marketplace, the applications,” said Ron Skelton, EPRI’s program manager for advanced information technology. The analysis is what he termed “the third wave” of research, spurred originally due to electric utility deregulation.
“The main focus will be on two-way customer communications. The obvious primary application would be to obtain metering data from customer premises to help customers manage their electric bills through refined pricing information we supply remotely regarding peak and off-peak power rates. They can then make decisions as to whether to buy electric power at that price.”
Additionally, smarter metering functions could monitor individual appliances within customers’ homes or premises-signaling which ones, for example, are wasting energy. “We’ve found situations where residential customers had the heating and air conditioning on at the same time,” Skelton said.
Within the newly competitive electric utility marketplace, wireless itself will be in competition with wireline and power line communications for customer monitoring. “Wireless isn’t the only way to do this, but it is the most popular and is more economical than over phone lines. You can also do something of the kind over power lines,” Skelton said. “There will be ongoing competition among the technologies.”
Kansas City Power & Light Co. is a utility industry leader in the area of automatic meter reading, according to Stephen Virostek, director of mobile data research for Economic Management Consultants International Inc., Washington, D.C. The majority of the million or so automatic meter reading devices currently in use belong to KCP&L’s system, he said.
“If cellular and PCS combine AMR with demand-side management, allowing you to stagger the biggest load demands, there would be a significant impact on reducing brownouts and blackouts,” Virostek said.
Utilities also see other big benefits for automatic meter reading.
“According to our interviews with utilities’ telecommunications managers, the biggest opportunity for wireless is in replacing the meter,” especially those in difficult-to-reach places, Virostek said. “About 10 percent, or 22 million, of all the meters in service are hard to read because they’re in a remote location, are indoors, behind a locked fence or a big dog. Yet this 10 percent accounts for 50 percent of the cost of reading meters.”
Additionally, he said, deregulation has created a spot market for bulk purchases of electricity. “If you can buy low and sell high, there is the potential for tens of millions of dollars, if not hundreds of millions of dollars in savings,” Virostek added.
One way to achieve this goal is to better control the flows of electricity that are wheeled long distances over the power grids. Large safety margins of error, limiting the amount of electricity transmitted over them at one time, were built into the grids in order to compensate for the comparative crudeness of the mechanical controls over the grids, said Skelton of EPRI.
“In the future, utilities will become more sensitive to efficiencies of the grid because they are in a more competitive environment,” he said.
