Smart Meters - Advanced Metering Infrastructure (AMI)

Background I Enabling Legislation I Functionality I Service Levels I Cost Recovery I Technology Trials I Customer Response Trial

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Background

In early 2006, the Victorian Government formally endorsed the deployment of AMI to all Victorian electricity consumers taking supply of less than 160 MWh per annum(which covers residential and small/medium business customers). The announcement of the AMI project followed an extensive cost-benefit study, the Study Report (PDF 493KB) co-funded by the Government and Victoria’s electricity distribution and retail businesses.

The AMI project effectively broadens an earlier decision by the Essential Services Commission (ESC) (external link) to roll out manually read interval meters across Victoria, by adding two-way communications capabilities to enable remote reading, remote connection and other functionalities.

Enabling Legislation

An amendment to the Electricity Industry Act 2000 (external link) was passed by the Victorian Parliament in August 2006, providing the Government with legislative heads of power to make Orders-in-Council establishing a range of requirements for the deployment of AMI, including functionalities, performance and service levels, as well as a framework for the regulated recovery of costs associated with installation and ongoing operation.

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Functionality

Currently, most Victorian electricity supply points are metered with electro-mechanical accumulation meters that only record total consumption and are subject to manual reading every three months.

Starting in 2009, approximately 2.5 million new AMI meters (often referred to as “smart meters”) will be installed over a 4 year period. These AMI meters will allow Victorian consumers to better manage their energy use by providing more detailed information about their consumption with the opportunity to save money on their power bill and reduce greenhouse gas emissions.

The technical capabilities of AMI meters have been prescribed by Government, by way of an Order-in-Council (external link), following an extensive and collaborative development exercise undertaken by the AMI project.

Functionalities and performance levels are detailed in the Minimum AMI Functionality Specification (Victoria), originally published by the Department on 18 October 2007 and revised in September 2008, as approved by the Minister for Energy and Resources, the Hon Peter Batchelor .

Minimum AMI Functionality Specification Victoria. September 2008. (PDF 1.3MB)

Service Levels

Service Levels, that establish obligations on both distributors and retailers with regard to the operation of AMI, have also been prescribed and are detailed in the Minimum AMI Service Levels Specification (Victoria), published by the Department on 18 October 2007 and revised in September 2008, as approved by the Hon Peter Batchelor, Minister for Energy and Resources.

Minimum AMI Service Levels Specification Victoria. September 2008 (PDF 312KB)

Cost Recovery

Consistent with the legislated heads of power, the Department has, in consultation with industry stakeholders, developed a framework for the regulated recovery of costs associated with the rollout of AMI. This framework is established by way of an Order-in-Council made on 28 August 2007 (PDF 309KB) and as amended by an Order-in-Council made on 25 November 2008 (PDF 403KB) and Order-in-Council made on 22 January 2009 (PDF 1.1MB).

Technology Trials

A key early consideration of the AAMI project was to establish that communications technologies are available to meet the requirements on AMI across a range of Victorian urban and rural environments.

To confirm that existing commercial AMI technologies, used in other countries and elsewhere in Australia, could be successfully transferred to Victoria, a series of technology trials were undertaken in 2006 and 2007 by Victorian industry participants.

These trials were substantively completed in August 2007 and the Department has prepared an overview of the key findings from the trials, AMI Technology Trials Report (PDF 771KB).

Customer Response Trial

Given the anticipated availability of interval consumption data through the AMI project, the Government is keen to promote new approaches to managing electricity usage across Victoria.

The Government has advanced negotiations with two industry participants to assess customer demand responses to new retail pricing structures enabled by AMI, and potential measures to encourage customers to participate in demand response programs.

It is expected that these trials will commence in 2009 and conclude in 2011. Further information will be posted when it becomes available.