12. Reasonableness of the Chosen Technology
In order to find that SCE's AMI system meets state energy policy objectives and that the technology choice is reasonable based on the AMI solutions available today, it is necessary to determine whether the system meets the Commission's minimum functionality requirements, will support future upgrades, and can be expected to retain its value throughout the 20-year expected useful life of the project.
12.1. Minimum Functionality Requirements
A ruling issued on February 19, 2004 in R.02-06-001 established six minimum functionality requirements that a proposed AMI system must meet. According to this ruling, AMI systems must support the following functions in order to receive approval:48
· Implementation of the following price responsive tariffs for:
o Residential and small commercial customers (200 kW) on an
opt out basis:
_ Two or three period time-of-use (TOU) rates with ability to change TOU period length;
_ Critical peak pricing with fixed (day-ahead) notification;
_ Critical peak pricing with variable or hourly notification; and
_ Flat/inverted tier rates.
o Large customers (200 kW to 1 megawatt (MW)) on an opt out basis:
_ Critical peak pricing with fixed or variable notification;
_ TOU pricing; and
_ Two part hourly real-time pricing.
o Very large customers (over 1 MW) on an opt out basis:
_ Two part hourly real-time pricing;
_ Critical peak pricing with fixed or variable notification; and
_ TOU pricing.
· Collection of usage data at a level of detail (interval data) that supports customer understanding of hourly usage patterns and how those usage patterns relate to energy costs.
· Customer access to personal energy usage data with sufficient flexibility to ensure that changes in customer preference of access frequency do not result in additional AMI system hardware costs.
· Compatibility with applications that utilize collected data to provide customer education and energy management information, customized billing, and support improved complaint resolution.
· Compatibility with utility system applications that promote and enhance system operating efficiency and improve service reliability, such as remote meter reading, outage management, reduction of theft and diversion, improved forecasting, workforce management, etc.
· Capability of interfacing with load control communication technology.
No party disputes that SCE's proposed AMI system and the system described in the settlement agreement meets these six requirements. Commission D.07-04-043 in A.06-12-026, SCE's Phase 2 AMI pre-deployment application, found that SCE's proposed AMI system meets these minimum functionality requirements.49
12.2. Flexibility and Value Over the Life of the Project
As described by SCE and DRA, the AMI project described in the settlement agreement provides a flexible platform that supports the types of AMI functionality currently available. The proposed AMI system will support at least two types of solid-state AMI meters from different vendors,50 uses open standards protocols within portions of the system,51 and the meters have the capability to accept some remote software upgrades if necessary.52 In addition, the system meets other Commission directives by including interface with a Home Area Network (HAN) compatible with the HAN adopted for use in the SDG&E AMI deployment proceeding last year. SCE and DRA attest that both its HAN system and its meters are being used by other utilities across the country, ensuring a base of between 11 million53 and 20 million54 meters using this communication technology, which is expected to be enough to ensure that the technology remains supported for years to come.
The business case also allows for one part of the communications system to be replaced at seven-year intervals, reflecting conservative assumptions to ensure that this portion of the system is not overly vulnerable to obsolescence.55 In addition, SCE and DRA testify that the system supports two-way communication between the utility and the customer's premise, making the technology appropriate for use if the state moves towards adoption of a smart grid.56 SCE and DRA also attest that the bandwidth of the chosen communication system is adequate for reasonably foreseeable uses, including those that may be associated with a future smart grid.57
Over all, the technology choice is reasonable when compared to existing AMI and related technology that is currently available, and can reasonably be expected to retain its value over the 20-year expected useful life of the program. The system also meets state policy objectives. Based on SCE's representations of the flexibility and expandability of the system, we will not look favorably on future requests for ratepayer funding to upgrade the chosen technology to adapt to changes related to demand response, smart grid, or similar projects.
48 Assigned Commissioner's Ruling dated February 19, 2004 in R.02-06-001, pp. 3-4.
49 D.07-04-043, FOF 1.
50 RT 212:15-19.
51 RT 210-214.
52 RT 212:2-14.
53 RT 214:11-12.
54 RT 232:15.
55 RT 218:4-9.
56 RT 212:26-213:11.
57 RT 228:2-229:3.
