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Perspective

Game-Changing Business Model: Private LTE for AMI and Smart Utility Programs

Game-Changing Business Model: Private LTE for AMI and Smart Utility Programs

The landscape of telecommunications options available to support utilities’ Operational Technology (OT) solutions is rapidly evolving - at a pace compared only by the changing needs of the OT requirements themselves. As utilities replace first generation Advanced Metering Infrastructure (AMI) solutions with current more feature-rich systems and expand the reach of traditional Distribution Automation (DA), Field Mobility (FM) and other existing solutions; new options are required for device connectivity and backhaul. The potential explosion of ubiquitous Internet of Things (IoT) devices will further change the utilities’ needs.

Against this backdrop, utilities are examining their current and future options. Traditionally, most utilities have maintained private core networks comprised of fiber rings, microwave, and radio systems. Utilities also utilize public carrier solutions, private single purpose vendor networks such as for AMI, etc. And a variety of solutions are employed for their Field Area Networks (FAN). But with the rapidly evolving technical landscape and business models available, utilities now have more choice than ever on how to combine public carrier and private networks.

The movement towards 5G and even greater use of LTE is imminent. But how to take advantage of this evolution is less certain. Is there a business case for utilities to use private LTE for the FAN backhaul, perhaps gradually replacing the current AMI or DA with private LTE, or for applications such as smart inverters? The potential cost savings and game-changing business model is worth studying further.

And what about the needs of the future significant numbers of IoT devices? How might utilities leverage the new 4G based low-power narrow band solutions LTE-M and NB1 (NB IoT). The future devices based on these standards promise significantly lower cost, improved battery performance and wide standards-based availability, assuming that the market and vendor support evolves as anticipated.

Private LTE for AMI and Smart Utility Programs

Some of the common communication networking questions facing utilities as they look to expand their operational technology (OT) programs or migrate to their next-generation AMI include the following:

  1. How can we “gracefully” upgrade and migrate our current AMI infrastructure to the next generation AMI while also extending the life, to the extent practical, of our existing AMI?
  2. How can we supplement our fiber-optic wide area network (WAN) communications with an affordable robust wireless solution to provide communications for thousands of endpoints for our backhaul of AMI, supervisory control and data acquisition (SCADA), DA, DER and the many growing low-power, battery-based IoT applications?
  3. How can we address the extensive maintenance needs for our field communications infrastructure considering that the number of endpoints will increase by over 1,000 percent in the future?
  4. What will new 5G cellular offer our utility?
  5. What is a practical roadmap to maximize our existing automation investments while greatly expanding our “smart utility” programs?

The full report explores these technology and market trends in more depth and identifies specific business opportunities that are worth utilities examining.

Rick Schmidt

About the Author

Rick Schmidt is a Managing Director with Black & Veatch Management Consulting. He is a subject matter expert in infrastructure modernization within the utility industry and brings years of experience in working with mid-market municipalities and cooperatives across North America. His additional expertise includes:

  • Utility Rates and Business planning
  • Electric, Water and Gas Advanced Metering Infrastructure
  • Customer and Utility Information System Planning, Procurement and Implementations
  • Asset Management planning and implementations

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