2016/66 k nKonw A A weldegdeg e ol n oNtoet e s eSrei r e ise s f ofro r p r&a c t hteh e nEenregryg y Etx itcrea c t i v e s G l o b a l P r a c t i c e The bottom line Can Utilities Realize the Benefits of Advanced Metering Advanced metering infrastructure (AMI) provides Infrastructure? Lessons from the World Bank’s Portfolio significant benefits to utilities around the world. Although it is entering the mainstream, Why is this issue important? tariff systems (such as time-of-use pricing), and interact with technical concerns, policy large connected loads to move them to nonpeak times (European Smart meters clearly benefit utilities and their Commission 2012). challenges, capacity, and will in the Bank’s client countries hinder customers, but implementation poses technical AMI significantly benefits all power system stakeholders. Utilities wider adoption. Starting out and organizational challenges benefit from reduced commercial losses through tamper- and with smaller AMI deployments collusion-resistant equipment, quicker accounting for electricity Advance metering infrastructure (AMI) refers to an integrated system aimed at addressing revenue sales, improved understanding of network performance, and rapid of smart meters and enabling communication networks and data constraints seems to offer notification of outages. AMI also benefits customers. By allowing management systems that provide enhanced capabilities over tradi- the best chance of success at utilities to vary tariffs by time and demand, AMI can enable new tional analog or digital meters. AMI-enabled smart metering evolved utilities supported by Bank- billing models that help customers save money. Such models can from previous one-way metering systems, such as traditional electro- financed projects. also reduce peak load (and hence generation costs and total system mechanical metering and automated meter reading (AMR) systems. emissions) and allow the utility to provide better customer service. In The key difference is the development of two-way communication this regard, AMI is one of the quickest and most cost-effective ways between the meters and the utility (US Department of Energy 2015).1 to improve system performance and revenue collection. In addition to preserving all of the features of previous systems Varun Nangia is a While the case for AMI is easily made, implementation of an AMI (figure 1), an AMI deployment allows, at a minimum, remote meter consultant with the World system can be challenging. World Bank projects have run a gamut reading, bidirectional communication, complex tariff systems, and Bank’s Energy and of challenges that have delayed projects significantly. These include utility control of energy supply (Uribe-Pérez and others 2016). In Extractives Global Practice. capacity and governance issues, interoperability and compatibility some AMI deployments, systems allow distributed power generation Samuel Oguah is an concerns, and taxes and tolls. This brief draws up a list of potential to be sold back to the grid and offer readings as often as every 15 energy specialist in the problems and mitigating actions based on the experience of World minutes to an in-house unit or third-party developers. The readings same practice. Bank staff with AMI projects currently under implementation or encourage energy savings. In such systems, utilities can often recently closed. These hard-won lessons can hopefully smooth the monitor operational and performance issues, support advanced Kwawu Gaba is a lead way for future rollouts that meet the needs of client countries. energy specialist with the A typical AMI system includes smart meters in each household, Energy and Extractives 1 World Bank experience in procuring AMR systems suggests that most currently com- data collector units at the neighborhood level, and a “metering mercially available AMR systems are actually AMI systems with the return communication Global Practice and also data and services management system” (MDMS) on the utility’s function disabled. In one memorable case, the difference was simply the absence of a SIM card leads the World Bank’s Power Systems in otherwise identical hardware and software. In countries with a history of AMR installation, premises. Communication between individual components may Global Solutions Group. certain domestic manufacturers continue to produce AMR hardware in support of previous involve wireless or wireline networks or a combination of the two. deployments, although expansions of such deployments are increasingly rare. Can Utilities Realize the Benefits of Advanced Metering Infrastructure? 2 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? Figure 1. Evolution of metering capabilities Smart meter system Functionality Stakeholders or benefactors • Integrated service switch • Marketing and demand-side management • Time-based rates • Load forecasting “Advanced metering AMI • Remote meter programming • Power procurement (full two way) • Power quality • Unregulated services infrastructure is particularly • Home area network interface Smart meter system capability effective at enhancing revenue collection, a major • Daily or on-demand readings • T&D operations • Hourly interval data • T&D engineering concern of utilities in most AMR plus • Outage notification • Information technology • Other commodity readings • Metering services of the World Bank’s client countries.” • Automated monthly readings • Customers and external stakeholders • One-way outage detection • Meter reading AMR • Tamper detection • Customer services • Load profiling • Billing, accounting, collections AMI = advanced metering infrastructure; AMR = automated meter reading; T&D = transmission and distribution. Source: Edison Electric Institute (2011). A wide variety of network mediums has been deployed, including drivers of smart grid adoption (IEA 2015a) (table 1). AMI deployments proprietary radio-frequency meshes; cellular, wi-fi and Bluetooth address all of these factors as a primary outcome of their installation. wireless networks; and DSL, optical fiber, and power line–based wired AMI is particularly effective at enhancing revenue collection, a networks (Uribe-Pérez and others 2016). major concern of utilities in most of the World Bank’s client countries (box 1). While disaggregated data on commercial and technical What are the main advantages of AMI? losses are difficult to find (aggregate data are usually available), a survey of utilities in Sub-Saharan Africa (Africa Infrastructure Enhanced revenue collection, real-time data exchange, Knowledge Program 2011) showed significant potential for stemming and accommodation of generation from renewable commercial losses. At an average tariff of $0.05/KWh, losses of nearly sources are driving the adoption of smart meters 353 TWh amounted to some $17.6 billion over the six-year period in a dozen countries. Capturing even a third of that revenue through Research produced by the International Energy Agency indicates that a revenue protection program (RPP) as described in box 1 would although interest in smart grids is high within utilities in economies significantly improve the cash flow of many utilities. at all levels of development, the factors driving adoption are different In addition to helping with revenue collection, AMI provides in developed and emerging economies. In emerging economies, reli- other benefits immediately relevant to client countries. The two-way ability, system efficiency, and assured revenue collection are the top nature of AMI ensures that information can be proactively sent from 3 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? Table 1. Drivers for the adoption of smart grids What has been the Bank experience with AMI deployments? Emerging economies Developed economies The Bank has learned much from recent Reliability System efficiency projects involving the installation of more than System efficiency Renewable power “Advanced metering two million smart meters Revenue collection and assurance New products, services, markets infrastructure facilitates Renewable power Customer choice and participation Since FY2010, the Bank has supported 14 projects involving AMI, with integration of renewable- substantial peaks in FY2012 and FY2015. Table 2 summarizes the Economic advantages Reliability improvements energy sources by Generation adequacy Asset utilization location and approximate cost of the AMI components, which total permitting consumers to about $420 million. Many newer programs have taken advantage of Source: IEA (2015a). the RPP described in box 1. AMI accounts for about 18 percent of sell excess power back to the total $2.34 billion lent by the World Bank for transmission and the grid.” the meter to the utility, allowing for quicker identification of, and distribution system upgrades under the 14 projects, varying from a response to, power outages, thereby increasing reliability. Smart high of 83 percent in Uzbekistan to a low of 3 percent in Argentina.2 meters can also report regularly on power quality, leading to greater In total, the projects involve the installation of approximately 2.27 awareness of system-reliability issues. Tariff mechanisms enabled million meters. Each meter costs approximately $240 to install, by AMI can reduce peak loads by encouraging large loads to be dis- with World Bank financing accounting for about $178 of this total, placed or deferred until off-peak hours, or by allowing customers to although there is wide variation in both the installed cost and the self-curtail power demand in response to tariff thresholds, all leading share of World Bank financing. to a more efficient power grid. Because smart meters communicate Descriptions of several of the projects follow. Special attention usage daily (or even more frequently), they are more tamper-resis- is paid to sources of delay, with the hope that such problems can be tant and are able to provide precise figures on consumption, thereby avoided in future projects. reducing commercial losses from theft and collusion between India: Haryana Power Sector Improvement Project customers and meter readers. Finally, AMI also facilitates integration (FY2010). The Haryana Power Sector Improvement Project set of renewable-energy sources by permitting consumers to sell excess a target to install about 80,000 meters for high-use domestic and power back to the grid (IEA 2015b). commercial customers—those with 10–15kV connections. Because In the course of any AMI deployment, it is critical that a compati- the utility, Dakshin Haryana Bijili Vitran Nigam (DHBVN), was con- ble MDMS should be selected. The MDMS must make the most of the cerned about inconsistent standards and the costs of deploying AMI, volume of information supplied by the new infrastructure and take it sought initially to reduce commercial losses using AMR meters. advantage of the full range of capabilities offered by smart metering. Eventually, however, the benefits of smart meters (demand response, In addition, the MDMS must be reliable and able to scale up for time-of-day usage billing, and real-time monitoring to detect theft), as service delivery once the AMI is deployed and meters are rolled out well as gradual reductions in cost and increasing standardization in in large numbers. the marketplace, convinced DHBVN to invest in an AMI deployment. As part of the process, the utility is planning a comprehensive 2 When support from other sources is counted, the projects have a value of approximately $3.17 billion. 4 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? Box 1. Smart meters protect revenue Growing numbers of World Bank projects involving advanced metering infrastructure (AMI) fiscal stability can help the utility to move to a sustainable financial situation and engage are using the model of the revenue protection program (RPP). According to World Bank Lead in longer-term planning. Unlike field campaigns or random inspections, moreover, AMI Energy Specialist Pedro Antmann, the RPP enhances the rationale for AMI deployments by deployments have negligible ongoing costs. linking them to a crucial driver in most utilities: revenue. Antmann’s experience showed Third, Antmann notes that in most utilities gathering clear and unambiguous data on power that in many utilities as few as 1–2 percent of the total customer base was responsible for usage improves transparency, accountability, and corporate governance. This is crucial to as much as 50–60 percent of the utility’s total revenue. The obvious conclusion: revenue reducing the perception of corruption and to building trust between utilities and their largest protection should start with the largest customers. customers. Internally, the deployment of an AMI system can improve morale by combining The figure shows an example from Brazil’s largest distribution company, CEMIG, where just the interests of engineers with the business interests of the utility. Antmann also notes that 30,000 customers—half of 1 percent of the customer base—were responsible for 46 percent an RPP is a decisive test of the utility’s willingness to address its problems—objections can of total revenue. suggest collusion between large customers and senior utility management. Similar structures exist in many of the World Bank’s client countries—where a handful of Finally, AMI deployments enable the utility to offer additional services and benefits to VIP customers are responsible for a large share of the total revenue. Antmann refers to these customers. These include detection of outages and faults and assurance of electricity quality. as the “VIP customers.” Ensuring that this revenue is protected is crucial to ensuring the Being able to respond to an outage preemptively, before the customer calls it in, builds long-term financial viability of the utility. It also allows the utility to offer additional services to goodwill toward the utility. Additionally, large customers can benefit from variable tariff VIP customers to keep them happy. Thus, the first step of an RPP is to roll out an AMI system schemes. Where there is a legal framework to enable net metering, a smart meter can create to VIP customers, leaving comprehensive installation for later. Experience has shown that this an extra revenue stream for some customers by allowing them to sell excess power back to approach has several benefits. the grid. First, a typical utility has very limited resources for replacing meters. But installing new meters Before implementing an RPP, several questions must be answered. for 30,000–50,000 customers can be done with modest resources—typically a few million • Does the utility know who its large customers are and what billing procedures are dollars. Yet the payback is enormous. Antmann cites the example of a deployment in the followed? Knowing the target customer base is the essential first step in rolling out an RPP. Dominican Republic that was repaid in seven months; most deployments, he notes, have In some cases, large customers may need to be regularized. paybacks of 18 months to two years. • Does the utility have a commercial department that deals with the needs of large Second, the AMI deployment does something that no other revenue measure can: it ensures customers? Having a department that is able to address the unique needs of VIP the permanence of these revenues, barring intentional tampering, which is detectable. This customers is critical to building goodwill for the rollout. The department may also take the lead in defining a plan with the targeted customers that ensures that both parties will be Half of 1 percent of all of customers are happy with the changes. responsible for 46 percent of revenue at CEMIG • What data management/commercial management systems are installed? To ensure compatibility and interoperability with existing systems, a technical stocktaking must be done to explore how any new system will synchronize with the existing one. In rare cases Customers A1, A2, and A3 where a relatively recent AMR rollout has occurred, it may be possible to upgrade the 21.7 (69 kV up to 230 kV) existing system, saving significant time. 358 • What local market conditions might affect price and procurement? Being aware of potential 825 5.4 challenges up front and allocating time to address these challenges will help ensure a smooth rollout. Customers A4 and A5 10,500 (2.5 kV up to 36.2 kV) 17.6 • What constitutes success? Having defined metrics that can be measured and effectively First step attributed to the project is key to building consensus for an expansion of an AMI rollout. Low-voltage customers 1.6 (>4,000 kWh) 18,000 Antmann notes that most projects following the RPP model are still under implementation, but early results have shown promise. One utility saw its commercial losses drop from nearly Low-voltage customers 40 percent to the low teens. Antmann predicts that real results will appear in the next two (< 4,000 kWh) 6.9 million 54 Next step Percent years, as more deployments are completed. of billing Source: Antmann (2015). Utility customers 5 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? Table 2. IBRD/IDA-supported AMI projects, FY2010 to Q3 FY2016 FY Project ID Project name Country US$ millions 2010 P110051 Haryana Power System Improvement Project India 34.27 2010 P114204 Eletrobras Distribution Rehabilitation Brazil 94.00 “The benefits of smart 2011 P114971 Energy Sector Strengthening Project Paraguay 4.00 meters—demand response, 2012 P115464 Recovery and Reform of Electricity Sector Cabo Verde 5.50 time-of-day usage billing, 2012 P122141 Energy Loss Reduction (Additional Financing) Tajikistan 5.00 and real-time monitoring 2012 P122773 Advanced Electricity Metering Project Uzbekistan 150.10 to detect theft—convinced 2015 P120014 Electricity Modernization Project Kenya 40.00 the utility to invest in an 2015 P133288 Renewable Energy Argentina 5.70 AMI deployment.” 2015 P133446 Electricity Supply Accountability Kyrgyz Rep. 4.00 2015 P143689 Clean and Efficient Energy Morocco 12.68 2015 P144029 Power Recovery Project Albania 20.00 2015 P149599 Power Grid Improvement Project Laos 19.00 2016 P147277 Distribution Grid Modernization and Loss Reduction Dominican Rep. 22.95 2016 P153743 Electricity Access Expansion Project Niger 4.00 Note: Amounts are estimated commitments based on reviews of project documents and interviews with team members. Actual expenditures may vary. outreach to customers to tout the benefits of smart metering, interoperability, resulting in a simpler procurement process that including mobile consumption monitoring and notification of outages. focused on making sure that bids met the technical standard and A significant delay in procurement occurred because of DHBVN’s then choosing the qualifying bid with the lowest price. concerns about interoperability. Although the current project Another problem arose in procurement. Bidders were concerned involves a relatively small revenue-focused deployment, DHBVN about several contract clauses that held all parties equally liable for ultimately hopes to deploy AMI universally for all three million of its problems during implementation. Since acquisition and installation of customers. To ensure that it was not locked into products provided the smart meters represent 70–80 percent of the typical cost struc- by a single vendor or system, DHBVN insisted that at least 20 percent ture of an AMI deployment (the MDMS and data analytics make up of the meters be supplied by a second vendor. To enforce this rule, the rest), meter manufacturers were concerned about the reliability DHBVN attempted a multistage bidding process to narrow the field of the connection with the MDMS at the back end, while back-end of potential bidders before opening the tender process, which providers were concerned that an issue with the metering hardware caused a significant delay in procurement. To speed resolution, the would negatively affect them. Bidders were also concerned about project team worked with DHBVN to facilitate meetings between the how to establish a baseline performance standard, given all the utility and prospective bidders to help the utility understand what moving parts. was technically feasible and commercially available, and what the Eventually, DHBVN issued a revised tender that addressed its long-term outlook was for compatibility and interoperability. This own concerns as well as those of the potential bidders. The new led DHBVN to adopt one of the fledgling standards for smart meter single-stage, two-envelope approach allows DHBVN to score the bids 6 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? on conformity with standards and other technical issues and then international bidders to view selection for the AMI tender as a scales the score based on bid price to ensure that the lowest-cost, chance to establish a foothold in the market by becoming familiar most full-featured bid is successful. DHBVN and the winning bidder with the import process. will also work to establish a baseline performance standard within Pricing of the incoming meters was also a significant issue. 30 days of completion of the deployment. This baseline will establish Regulatory issues have kept the prices of domestic meters extremely “To ensure the integrity responsibility for failures and provide a comparator against which all high. In preparing the bidding documents, Brazilian auditors wanted of the bidding process, parties can transparently evaluate future reliability issues. to compare the cost of the international meters after the high import Brazil: Eletrobras Distribution Rehabilitation (FY2010). tariff had been applied so as to make the domestic meters appear extensive efforts— The Eletrobras Distribution Rehabilitation Project sought to improve more competitive. To ensure the integrity of the bidding process, including ten separate the commercial standing of six distribution companies located in extensive efforts—including ten separate revisions of the bidding revisions of the bidding Brazil’s relatively poor northern and Amazonian provinces. Because documents—were made to ensure that the bidding process was documents—were made of their poor fiscal health, these six companies were not privatized conducted on a level playing field. A final twist came on the eve along with their peers in the rest of the country a generation ago. of the contract signing. Eletrobras thought the winning bidder was to ensure that the bidding However, given shrinking subsidies and the financial situation of the going to pay the expensive road-user fees for transporting the process was conducted on six northern and Amazonian distribution companies, these remaining meters from the port of São Paolo to the rural north, while the bidder a level playing field.” public distribution companies felt pressure to reduce losses quickly thought that the fees were to be paid by Eletrobras. The team worked and to improve efficiencies. Another significant driver for the instal- intensively to find a way to ensure that the amount was paid from lation of smart meters and other automation was the remoteness Bank project funds to ensure the lowest cost to the end consumer of the region and the absence of large cities. Data to improve power and the success of the project. planning are analyzed in Brasilia; infrastructure is required to relay Despite these difficulties, the project has had some notable detailed data back to Eletrobras headquarters. co-benefits. The winning bidder, a joint venture between Siemens, The project encountered several country-specific challenges that Itron, and Brazil-based Telemont Telecommunications Engineering, were overcome through negotiation and accommodations in pro- committed to draw heavily on local labor to install the meters, curement. For example, the government first wanted national bidding promoting employment in a relatively poor part of Brazil. Additionally, rather than international competitive bidding. However, research by through the efforts of the team, a recycling and waste management the project team showed that domestically manufactured meters system was established for the meters that were being replaced by had fewer features and were considerably more expensive than their the new smart meters, with the objective of recycling almost all of international competitors. the materials in the old meters and so greatly reducing the waste An added challenge to international bidding was the complex generated by the replacement program. At the end of March 2016, two-stage process for certifying meters in Brazil. First, the meter the main MDMS data center in Brasilia was brought online, with a type had to be approved by the National Institute of Metrology, small portion of the meters sending live data. Standardization, and Industrial Quality (INMETRO), the national Tajikistan: Energy Loss Reduction Additional Financing standards regulator. Then, each meter had to be sent to a testing lab (FY2010). The Energy Loss Reduction Project planned to install a to verify conformity with the reference meter and stamped with the comprehensive advanced metering system in Dushanbe to stem INMETRO logo. International bidders expressed concern over delays losses approaching 20 percent. The implementing utility, Burki Tajik in having their meters approved, particularly since the domestic (BT), chose to push for universal metering, rather than following meter manufacturers have a controlling interest in the testing labs. To a revenue-first approach. This proved to be challenging. BT had assuage this concern, clauses in the tender were added to prevent limited internal capacity, which made the procurement process the winning bidder from incurring penalties traceable to certification extremely difficult. The project financed a procurement specialist delays. Additionally, during pre-bid workshops, the team encouraged to help the utility prepare bid documents, engage in bid evaluation, 7 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? and negotiate contracts. BT procured 215,000 meters, including rollout, which may have challenged the institutional capacity of the some 5,000 spares. About 172,000 of these were installed before the utility. project closed. A major concern was the shortage of contractors with Kenya: Electricity Modernization Project (FY2015). The experience installing the meters, which BT rectified by having its own power distribution utility, Kenya Power and Lighting Company staff do some of the installation work. (KPLC), will deploy about 45,000 meters as part of an RPP covering “The utility chose to In addition to the smart metering portion of the project, which some 4,300 high- and medium-voltage customers and 40,000 large push for universal was financed by the World Bank, BT set out to procure a remote low-voltage customers. Although making up only 2 percent of KPLC’s metering and commercial management system under a separate customers, these large users represent 72 percent of the total metering, rather than grant provided by the Swiss government. While the installation of the revenues of the utility. The effect of the deployment will be to cut following a revenue-first meters is substantially complete, the complexity of the SAP-based commercial losses in half. Procurement for this component of the approach. This proved to MDMS overwhelmed the selected vendor, and the cost exceeded project has begun and will likely conclude in six to nine months. be challenging.” the financing available from the Swiss grant. The World Bank remains Argentina: Renewable Energy Project (FY2015). A pilot engaged in an effort to support BT in completing these metering remote metering scheme is under development to measure the systems, but in the interim has advised the utility on how best to precise usage of households in order to monitor and evaluate the utilize its existing billing systems. It is noteworthy that, despite the use of solar home systems, wind systems, and small photovoltaic challenges in the rollout of MDMS, losses fell modestly and electricity systems in individual homes, isolated public facilities, and micro-grids sales exceeded the end-of-project target by about 15 percent, thanks in remote communities. A significant challenge for this deployment in part to the newly effective metering. is the volume of data to be collected and the remoteness of the Uzbekistan: Advanced Electricity Metering Project installations. The project is in an early phase of implementation, and (FY2012). The Advanced Electricity Metering Project (AEMP) was procurement is expected to begin later this year. designed to install AMI in Tashkent City and two neighboring oblasts. Kyrgyz Republic: Electricity Supply Accountability Driven by the need to replace traditional electromechanical meters (FY2015). The Electricity Supply Accountability Project sought to installed between 1960 and 1990, meters that have rarely been broaden a previous series of rollouts financed by KfW Development calibrated and are past their useful life, the AEMP sought to replace Bank. Under the project, an additional 30,000 meters will comple- about 1.2 million meters for low-voltage residential and institutional ment the 110,000 previously procured. Even though the meters cover customers. Unusually, the project separated the hardware acqui- only 140,000 of Severelectro’s 510,000 customers, they represent sition and installation into two separate contracts—the Metering more than half of the utility’s total consumption and revenue stream. Infrastructure Project, worth about $150 million, and an energy data Two bidders emerged from the procurement process—a management package worth $18 million. This contract structure company that had provided the previously procured meters and the raises concerns about compatibility in the near future. company that had been serving as an installer for the existing rollout. However, the project has run into difficulties with procurement of The latter firm, Hexing, was selected. Hexing’s meters, which use the meters: at the request of the government, the standard bidding the same standard as the previous meters, required new software process was replaced by a two-stage process to narrow the list to interface with the existing MDMS. The company committed to of qualified bidders, leading to significant delays. In addition, cost provide this software as part of their bid, illustrating one approach to concerns from the government caused several months of delay in solving possible interoperability and compatibility issues. approving the metering package. This obstacle was only recently Albania: Power Recovery Project (FY2015). The Power overcome, and the tender has now been issued to the prequalified Recovery Project seeks to reduce the public obligation to guarantee bidders. The second portion, the energy data management package, supply at regulated rates by moving medium-voltage commercial is nearing the end of the prequalification stage. Notably, the project customers to the wholesale market. This move, which follows a did not follow an RPP-like model but instead attempted a universal similar shift of high-voltage customers in 2011, will put Albania at 8 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? the forefront of EU energy-market reforms. To support the move of Once under active implementation, a few projects took as long as medium-voltage commercial customers to the wholesale market, two years to proceed to procurement (as was the case in Brazil and the project will supply meters for these customers, enable metering India). The project in Uzbekistan is approaching four years of delay. at the feeders serving them, and build out a supporting MDMS. The Implementation can also be incomplete, as in Tajikistan, where the project is at an early stage of implementation; the procurement meters were procured and installed but the MDMS was not com- “Moving medium-voltage process is about to begin. pleted, leaving a system only partially enabled and unable to achieve commercial customers to all the goals set out for it. the wholesale market will What have we learned from our engagements? Overall, the picture appears to be one of country-specific issues put Albania at the forefront that delay implementation. But two larger overall issues emerge. Most of what seem like country-specific issues The first is the motivation behind the installation of the AMI of EU energy-market fall into two categories system. In countries where AMI has been used to improve revenue reforms.” As the case summaries show, some of the Bank’s experience with collection as a prelude to universal metering, rollouts have been AMI deployments have been challenging (table 3). Several projects more successful. The two-stage process builds a guaranteed revenue took many months to achieve their initial implementation (as was stream from the largest customers, improving the ability of the utility the case in Kenya and Kyrgyz Republic), but significant delays in to execute a wider rollout and allowing it to become more comfort- projects occurred even after they were well into implementation. able with the technology’s capabilities and limitations. Projects that Table 3. Drivers and challenges in IBRD/IDA-supported AMI projects since FY2010 Dominican Rep. Kyrgyz Rep. Uzbekistan Argentina Tajikistan Morocco Lao PDR Albania Kenya Brazil Niger India Drivers Commercial losses, especially theft X X X X X X X X X X Technical losses X X X X X X Remoteness X X Reliability / efficiency X X X X X X X Renewable power X X Challenges Institutional capacity X X The projects in Kenya, Argentina, Albania, Morocco, Regulatory issues X X X Lao PDR, Dominican Rep., and Niger are not yet Procurement (interest, cost, taxation) X X X X under implementation. Technical (interoperability, compatibility) X X X X 9 C a n U t i l i t i e s R e a l i z e t h e B e n e f i t s o f A d v a n c e d M e t e ri n g I n f ras t ruc t ur e ? follow a revenue-focused model also tend to execute faster. This scalable, permitting a utility to extend the AMI solution to a more Make further process also seems to enhance corporate governance at the utility. comprehensive base of customers. connections The second issue is interoperability and compatibility between systems from different vendors and between generations from What is next for AMI deployments? Live Wire 2014/1. each vendor. To some extent, these concerns have been mitigated “Transmitting Renewable by the finalization and adoption of standards such as the Device By starting with revenue protection, utilities can Energy to the Grid,” by Language Message Specification, which create common methods scale up to wider installations Marcelino Madrigal and for meters to exchange capabilities and data with each other and Data from the International Energy Agency show that the number of Rhonda Lenai Jordan. with back-end systems such as the MDMS (DLMS Consortium 2016). smart meters is likely to increase significantly over the next decade However, vendors remain concerned about reputational risk from Live Wire 2015/38. “Integrating and reach approximately half of the total installed meter base by projects that suffer from integration difficulties. Following the RPP Variable Renewable 2023 (figure 2). While the penetration rate is expected to be highest in model described in box 1 can further mitigate these risks by giving Energy into Power System North America and Europe, approaching 80 percent and 60 percent all stakeholders confidence in the outcome of a larger deployment Operations,” by Thomas respectively, installations in East Asia and the Pacific and in Latin through participation in a pilot project that builds experience and Nikolakakis and Debabrata America and the Caribbean are also expected to increase signifi- addresses interoperability concerns. Chattopadhyay. cantly (IEA 2015a). The choice of MDMSs also plays a critical role in addressing this issue. Selecting a technology-agnostic MDMS helps resolve several However, these installations will not be fully successful in Live Wire 2015/44. “Mapping critical issues: (i) interoperability and compatibility between smart developing countries unless the challenges that existing projects Smart-Grid Modernization in meters from different vendors; (ii) integration with legacy metering have encountered are addressed. The lessons learned from existing Power Distribution Systems,” systems; and (iii) support for diverse protocol standards and commu- World Bank projects—focusing on revenue as described in box 1 by Samuel Oguah and nication media (power line communication, radio frequency meshes, and addressing interoperability and compatibility concerns—can Debabrata Chattopadhyay. point-to-point connections, and so on). While technology-agnostic play a significant role in driving successful deployments in emerging Live Wire 2015/48. MDMSs are a relatively new development, they are extremely economies. “Supporting Transmission and Distribution Projects: World Bank Investments since Figure 2. Penetration of smart meters, by world region 2010,” by Samuel Oguah, 100 North America Debabrata Chattopadhyay, Percent of total installed meters Europe and Morgan Bazilian. 80 Asia Pacific Latin America Live Wire 2016/65. 60 “Improving Transmission 40 Planning: Examples from Andhra Pradesh and West 20 Bengal,” by Kavita Saraswat 0 and Amol Gupta. 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 (Continued) Source: IEA (2015a). References European Commission. 2012. “Commission Recommendation of 9 Make further Africa Infrastructure Knowledge Program. 2011. Country Data. March 2012 on preparations for the roll-out of smart metering connections (cont’d) systems.” Official Journal of the European Union L 48(9): 9–22. Accessed May 2, 2016. http://infrastructureafrica.org/library/ Uribe-Pérez, Noelia, Luis Hernández, David de la Vega, and Itziar doc/1062/country-data. Live Wire 2016/67. “Managing Angulo. 2016. “State of the art and trends review of smart Antmann, Pedro. 2015. “Revenue protection programs (RPPs) the Grids of the Future in metering in electricity grids.” Applied Sciences 6(3): 68. supported by Advanced Metering Infrastructure (AMI)—A tool Developing Countries: Recent US Department of Energy. 2015. “Advanced metering infrastructure to improve commercial performance of electricity distribution World Bank Support for and customer systems.” Accessed March 8, 2016. https://www. companies.” Unpublished PowerPoint presentation. April. SCADA/EMS and SCADA/DMS smartgrid.gov/recovery_act/deployment_status/sdgp_ami_sys- DLMS Consortium. 2016. “What is DLMS/COSEM?” Accessed April Systems,” by Varun Nangia, tems.html. 4, 2016. http://www.dlms.com/information/whatisdlmscosem/ Samuel Oguah, and Kwawu index.html. The authors thank Zayra Romo for serving as peer reviewer; Jimmy Pannett Gaba. Edison Electric Institute. 2011. “Smart meters and smart meter sys- also provided comments. They also thank Pedro Antmann, Sudeshna Live Wire 2016/68. tems: A metering industry perspective.” Edison Electric Institute, Banerjee, Marcio Batitucci, Zamir Chargynov, Vivien Foster, Christophe de “Automating Power Palo Alto, CA, USA. Gouvello, Imtiaz Hizkil, Megan Meyer, Jimmy Pannett, Frederico Rabello, Pekka IEA (International Energy Agency). 2015a. Energy Technology Salminen, Kavita Saraswat, Rajendra Singh, and Lucia Spinelli for taking time Distribution for Improved Perspectives 2015: Mobilising Innovation to Accelerate Climate to speak about their projects and experiences. Morgan Bazilian provided Reliability and Quality,” valuable support and encouragement. by Samuel Oguah, Varun Action. Paris. Nangia, and Kwawu Gaba. ———. 2015b. How2Guide for Smart Grids in Distribution Networks: Roadmap Development and Implementation. Paris. Live Wire 2016/69. “Smartening the Grid in Developing Countries: Emerging Lessons from World Bank Lending,” by Varun Nangia, Samuel Oguah, and Kwawu Gaba. Get Connected to Live Wire Live Wires are designed for easy reading on the screen and for downloading The Live Wire series of online knowledge notes is an initiative of the World Bank Group’s Energy and self-printing in color or “Live Wire is designed and Extractives Global Practice, reflecting the emphasis on knowledge management and solu- black and white. tions-oriented knowledge that is emerging from the ongoing change process within the Bank for practitioners inside Group. For World Bank employees: and outside the Bank. 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Once a year, the Energy and Extractives Global Practice takes stock of all notes that appeared, reviewing their quality and identifying priority areas to be covered in the following year’s pipeline. Please visit our Live Wire web page for updates: http://www.worldbank.org/energy/livewire e Pa c i f i c 2014/28 ainable energy for all in easT asia and Th 1 Tracking Progress Toward Providing susT TIVES GLOBAL PRACTICE A KNOWLEDGE NOTE SERIES FOR THE ENERGY & EXTRAC THE BOTTOM LINE Tracking Progress Toward Providing Sustainable Energy where does the region stand on the quest for sustainable for All in East Asia and the Pacific 2014/29 and cenTral asia energy for all? in 2010, eaP easTern euroPe sT ainable en ergy for all in databases—technical measures. This note is based on that frame- g su v i d i n had an electrification rate of Why is this important? ess Toward Pro work (World Bank 2014). SE4ALL will publish an updated version of 1 Tracking Progr 95 percent, and 52 percent of the population had access Tracking regional trends is critical to monitoring the GTF in 2015. to nonsolid fuel for cooking. the progress of the Sustainable Energy for All The primary indicators and data sources that the GTF uses to track progress toward the three SE4ALL goals are summarized below. consumption of renewable (SE4ALL) initiative C T I V E S G L O B A L P R A C T I C E ENERGY & EXTRA • Energy access. Access to modern energy services is measured T E S E R I E S F O R T H EIn declaring 2012 the “International Year of Sustainable Energy for energy decreased overall A KNO W L E D G E N Oand 2010, though by the percentage of the population with an electricity between 1990 All,” the UN General Assembly established three objectives to be connection and the percentage of the population with access Energy modern forms grew rapidly. d Providing Sustainable accomplished by 2030: to ensure universal access to modern energy energy intensity levels are high to nonsolid fuels.2 These data are collected using household Tracking Progress Towar services,1 to double the 2010 share of renewable energy in the global surveys and reported in the World Bank’s Global Electrification but declining rapidly. overall THE BOTTOM LINE energy mix, and to double the global rate of improvement in energy e and Central Asia trends are positive, but bold Database and the World Health Organization’s Household Energy for All in Eastern Europ efficiency relative to the period 1990–2010 (SE4ALL 2012). stand policy measures will be required where does the region setting Database. The SE4ALL objectives are global, with individual countries on that frame- on the quest for sustainable to sustain progress. is based share of renewable energy in the their own national targets databases— technical in a measures. way that is Thisconsistent with the overall of • Renewable energy. The note version energy for all? The region SE4ALL will publish an updated their ability energy mix is measured by the percentage of total final energy to Why is this important ? spirit of the work initiative. (World Bank Because2014). countries differ greatly in has near-universal access consumption that is derived from renewable energy resources. of trends is critical to monitoring to pursue thetheGTF in 2015. three objectives, some will make more rapid progress GTF uses to Data used to calculate this indicator are obtained from energy electricity, and 93 percent Tracking regional othersindicators primary will excel and data sources that elsewhere, depending on their the while the population has access le Energy for All in one areaThe goals are summarized below. balances published by the International Energy Agency and the the progress of the Sustainab respective track starting progress pointstowardand the three SE4ALL comparative advantages as well as on services is measured to nonsolid fuel for cooking. access. Accessthat they modern to are able to energy marshal. United Nations. despite relatively abundant (SE4ALL) initiative the resources and support Energy with an electricity connection Elisa Portale is an l Year of Sustainable Energy for To sustain percentage of by the momentum forthe the population achievement of the SE4ALL 2• Energy efficiency. The rate of improvement of energy efficiency hydropower, the share In declaring 2012 the “Internationa energy economist in with access to nonsolid fuels. three global objectives objectives, andathe means of charting percentage of the population global progress to 2030 is needed. is approximated by the compound annual growth rate (CAGR) of renewables in energy All,” the UN General Assembly established the Energy Sector surveys and reported access to modern universalAssistance The World TheseBank and data are the collected International using household Energy Agency led a consor- of energy intensity, where energy intensity is the ratio of total consumption has remained to be accomplished by 2030: to ensure Management Database and the World of theenergy intium of 15 renewable international in the World Bank’s Global agencies toElectrification establish the SE4ALL Global primary energy consumption to gross domestic product (GDP) energy the 2010 share of Program (ESMAP) relatively low. very high energy services, to double Database. measured in purchasing power parity (PPP) terms. Data used to 1 t ’s Household provides Energy a system for regular World Bank’s Energy the global rate of improvemen and Extractives Tracking Framework Health (GTF), which Organization in the energy intensity levels have come and to double the global energy mix, Global Practice. (SE4ALL 2012). based on energy. of renewable The sharepractical, rigorous—yet energy given available calculate energy intensity are obtained from energy balances to the period 1990–2010 global reporting, Renewable down rapidly. The big questions in energy efficiency relative setting by the percentage of total final energy consumption published by the International Energy Agency and the United evolve Joeri withde Wit is an countries individual mix is measured Data used to are how renewables will The SE4ALL objectives are global, economist in with the overall from renewable energy when every resources. person on the planet has access Nations. picks up a way energy that is consistent 1 The universal derived that isaccess goal will be achieved balances published when energy demand in from energy their own national targets through electricity, clean cooking fuels, clean heating fuels, rates the Bank’s Energy and countries differ greatly in their ability calculate this indicator are obtained to modern energy services provided productive use and community services. The term “modern solutions” cookingNations. again and whether recent spirit of the initiative. Because Extractives Global rapid progress and energy for Energy Agency and the United liquefied petroleum gas), 2 Solid fuels are defined to include both traditional biomass (wood, charcoal, agricultural will make more by the refers to solutions International that involve electricity or gaseous fuels (including is pellets and briquettes), and of decline in energy intensity some t of those of efficiency energy and forest residues, dung, and so on), processed biomass (such as to pursue the three objectives, Practice. depending on their or solid/liquid fuels paired with Energy efficiency. The rate stoves exhibiting of overall improvemen emissions rates at or near other solid fuels (such as coal and lignite). will excel elsewhere, rate (CAGR) of energy will continue. in one area while others liquefied petroleum gas (www.sustainableenergyforall.org). annual growth as well as on approximated by the compound and comparative advantages is the ratio of total primary energy respective starting points marshal. where energy intensity that they are able to intensity, measured in purchas- the resources and support domestic product (GDP) for the achievement of the SE4ALL consumption to gross calculate energy intensity Elisa Portale is an To sustain momentum terms. Data used to charting global progress to 2030 is needed. ing power parity (PPP) the International energy economist in objectives, a means of balances published by the Energy Sector International Energy Agency led a consor- are obtained from energy The World Bank and the SE4ALL Global Energy Agency and the United Nations. Management Assistance agencies to establish the the GTF to provide a regional and tium of 15 international for regular This note uses data from Program (ESMAP) of the which provides a system for Eastern Tracking Framework (GTF), the three pillars of SE4ALL World Bank’s Energy and Extractives on rigorous—yet practical, given available country perspective on Global Practice. global reporting, based has access Joeri de Wit is an will be achieved when every person on the planet The universal access goal heating fuels, clean cooking fuels, clean energy economist in 1 agricultural provided through electricity, biomass (wood, charcoal, to modern energy services The term “modern cooking solutions” to include both traditional and briquettes), and Solid fuels are defined the Bank’s Energy and use and community services. biomass (such as pellets 2 and energy for productive petroleum gas), and so on), processed fuels (including liquefied and forest residues, dung, involve electricity or gaseous at or near those of Extractives Global refers to solutions that overall emissions rates other solid fuels (such as coal and lignite). with stoves exhibiting Practice. or solid/liquid fuels paired (www.sustainableenergyforall.org). liquefied petroleum gas Contribute to If you can’t spare the time to contribute to Live Wire, but have an idea for a topic, or case we should cover, let us know! Do you have something to say? We welcome your ideas through any of the following Say it in Live Wire! channels: Via the Communities of Those working on the front lines of energy and extractives development in emerging economies Practice in which you are have a wealth of technical knowledge and case experience to share with their colleagues but active seldom have the time to write for publication. By participating in the Energy Live Wire offers prospective authors a support system to make sharing your knowledge as easy as and Extractives Global possible: Practice’s annual Live Wire • Trained writers among our staff will be assigned upon request to draft Live Wire stories with series review meeting staff active in operations. • A professional series editor ensures that the writing is punchy and accessible. By communicating directly • A professional graphic designer assures that the final product looks great—a feather in your cap! with the team (contact Morgan Bazilian, mbazilian@ Live Wire aims to raise the profile of operational staff wherever they are based; those with worldbank.org) hands-on knowledge to share. That’s your payoff! It’s a chance to model good “knowledge citizenship” and participate in the ongoing change process at the Bank, uroPe and cenT ral asia 2014/29 all in easTern e ble energy for v i d i n g s u s Ta i n a where knowledge management is becoming everybody’s business. ess Toward Pro 1 Tracking Progr TICE IVES GLOBAL PRAC ENERGY & EXTRACT E SERIES FOR THE A KNOWLEDGE NOT rgy Providing Sustainable Ene Tracking Progress Toward Or 2014/5 1 U n d e r s ta n d i n g C O 2 emissiOns frOm the glObal energy seCt THE BOTTOM LINE All in East ern Euro pe and Central Asia for stand where does the region on the quest for sustaina ble based on that frame- measures. This note is databases—technical updated version of energy for all? The region SE4ALL will publish an has near-universal access to WhyD is this important? ERGY PRACTICE work (World Bank 2014). E G E N O T E S E R I E S F O R T H E E N to of A K N O W L is critical monitoring the GTF in 2015. the GTF uses to Tracking regional trends electricity, and 93 percent and data sources that for All The primary indicators summarized below. n has access able Energy are the populatio the progress of the Sustain track progress toward the three SE4ALL goals Understanding CO Emissions from the Global Energy Sector nonsolid fuel for cooking. is measured to modern energy services THE BOTTOM LINE to Your Name Here t (SE4ALL) initiativ e Energy access. Access connection despite relatively abundan 2 populatio n with an electricity ional Year of Sustainab le Energy for by the percentage of the to nonsolid fuels. 2 hydropower, the share the energy sector contributes In declaring 2012 the “Internat objectives the populatio n with access established three global and the percentage of about 40 percent of global of renewables in energy All,” the UN General Assembly using househo ld surveys and reported access to modern These data are collected Why is this issue important? 2030: to ensure universal World Become an author emissions of CO2. three- consumption has remained to be accomplished by energy in Global Electrifica tion Database and the share of renewab le in the World Bank’s quarters of those emissionsrelatively low. very high energy Mitigating climate change energy requires services, to 1 double the 2010 knowledge of the improvem ent tion’s Househo ld Energy Database. rate of Organiza CO intensity levels have come and to double the global Figure 1. CO2 emissions Health Figure 2. energy-related The share of renewable 2 energy in the energy come from six major the global energy mix, sources of CO question s2 emissions to the period 1990–201 0 (SE4ALL 2012). by sector Renewab le energy. emissions by country consumption down rapidly. The big economies. although coal-fired in energy efficiency relative countries setting percenta ge of total final energy mix is measured by the of Live Wire and global, with individual LICs evolve les will opportunities to cut emissions of greenhouse aregases used to plants account for just are how renewab Identifying The SE4ALL objectives le energy resources. Data 0.5% picks up understanding of the main sources ofin those a way that is consistent with emis- the overall that is derived from renewab balances published 40 percent of world energy when energy demand requires a clear their own national targets in their ability Other this indicator are obtained from energy recent rates (CO ) accounts for more than 80 percent of countries differ greatly Residential calculate Other MICs Nations. sions. Carbon again and whether dioxide Because sectors Agency and the United spirit of the initiative. 6% production, they were 2 by the International Energy China will make more rapid progress 10% 15% intensity gas emissions globally, 1 primarily from the burning s, some efficiency is contribute to your responsible for more than of decline in energy total greenhouse to pursue the three objective on their Other HICs . The rate of improvement of energy energy sector—defined toexcel elsewhere, depending include Energy efficiency 30% growth rate (CAGR) of energy will continue. of fossil fuels (IFCC 2007). The will 8% in one area while others by the compound annual Energy 70 percent of energy-sector as well as on 41% approxim and heat generation—contributed and compara 41tive advantages ated Japan 4% energy the ratio of total primary Industry emissions in 2010. despite fuels consumed for electricity respective starting points 20% Russia energy intensity is that they are able to marshal. in 2010 (figure 1). Energy-related intensity, where USA product (GDP) measured in purchas- improvements in some percent of global CO2 emissions the resources and support 7% domestic practice and career! such of achievem ent of the SE4ALL Other consumption to gross calculate energy intensity bulk 19% is an at the point of combustion make up the for the India countries, the global CO2 Elisa 2 emissions COPortale To sustain momentum transport Road is needed. 7% (PPP) EU terms. Data used to andinare generated by the burning of fossil global progress to 2030 6% transport fuels, industrial ing power parity the International economist objectives, a means of charting balances published by emissions 11% emission factor for energy energy 16% EnergyandSector nonrenewable municipal waste to generate nal Energy Agency led electricity Internatio a consor- are obtained from energy The World Bank and the the waste, generation has hardly changed United Nations. ent Assistance venting and leakage to establish the emissions SE4ALL Global Energy Agency and the sector at the point and over the last 20 years. and heat. Black carbon and methane Managem tium of 15 international agencies Notes: Energy-related CO2 emissions are CO2 emissions from the energy from the GTF to provide a regional of the for regular This note usesanddata domestic presented in this note. which provides a system bunkers, Program (ESMAP) of combustion. Other Transport includes international marine aviation for Eastern are not included in the analysis Tracking Framework (GTF), Other Sectors on the include three pillars of SE4ALL commercial/public Extractives given available rail and pipeline transport; perspect ive World Bank’s Energy and aviation and navigation, on rigorous— yet practical, country and heat genera- global reporting, based services, agriculture/forestry, fishing, energy industries other than electricity Global Practice. not specified elsewhere; Energy = fuels consumed for electricity and Where do emissions come from? tion, and other emissions as has in the opening paragraph. HIC, MIC, and LIC refer to high-, middle-, access Joeri de Wit is an will be achieved when on the planet heat generation, every person defined The universal access goal of countries heating fuels, energy economistare Emissions concentrated in 1 in a handful to modern energy services provided through electricity, fuels, clean and low-income clean cooking countries. cooking solutions” to include both traditional biomass (wood, charcoal, agricultural The term “modern Source: IEA 2012a. Solid fuels are defined and briquettes), and the Bank’s Energy and use and community services. biomass (such as pellets 2 and come primarily from burning and energy coal for productive that involve electricity or gaseous fuels (including liquefied petroleum gas), near those of and forest residues, dung, and so on), processed Vivien Foster is sector Extractives Global refers to solutions overall emissions rates at or other solid fuels (such as coal and lignite). with stoves exhibiting manager for the Sus- or solid/liquid fuels paired energy-related CO2 emissions closely The geographical pattern of Practice. (www.sustainableenergy forall.org). liquefied petroleum gas middle-income countries, and only 0.5 percent by all low-income tainable Energy Depart- mirrors the distribution of energy consumption (figure 2). In 2010, ment at the World Bank countries put together. almost half of all such emissions were associated with the two (vfoster@worldbank.org). Coal is, by far, the largest source of energy-related CO2 emissions largest global energy consumers, and more than three-quarters globally, accounting for more than 70 percent of the total (figure 3). Daron Bedrosyan were associated with the top six emitting countries. Of the remaining works for London This reflects both the widespread use of coal to generate electrical energy-related CO2 emissions, about 8 percent were contributed Economics in Toronto. power, as well as the exceptionally high CO2 intensity of coal-fired by other high-income countries, another 15 percent by other Previously, he was an power (figure 4). Per unit of energy produced, coal emits significantly energy analyst with the more CO emissions than oil and more than twice as much as natural 2 World Bank’s Energy Practice. Gas Inventory 1 United Nations Framework Convention on Climate Change, Greenhouse 0.php gas. Data—Comparisons By Gas (database). http://unfccc.int/ghg_data/items/380