- Networking and Communications
- Distributed Automation
- Utility Transformations
- Utility Transformations
- Smart Meters
- Energy Cloud
What to Consider When Evaluating Networking Solutions
As the electric utility business evolves toward a bidirectional, multi-faceted model (i.e., the Energy Cloud), utilities’ need for robust, future-proof communications networks is paramount—but decision-making can seem fraught with risk. The wrong choice can quickly become a limiting factor as management teams explore new applications at the grid edge. But as distributed generation proliferates and overall energy usage falls, the need for that visibility will only become more critical—to customer engagement, demand-side management, transactional energy, load management, asset management, and more.
Traditionally, utilities have preferred to purchase their networking infrastructure, making large capital investments that they can put into their rate cases. Regulators have generally shown a strong preference for the lowest (upfront) cost approach.
Increasingly, however, utilities are evaluating the total cost of ownership (TCO) for various solutions. So where Solution A may be the most attractive in terms of initial costs, over the 10/15/20-year lifecycle of the network, Solution A may actually be more expensive—or worse, it may not be robust enough to support emerging applications.
Recently, Navigant Research was commissioned to do a TCO analysis comparing private spectrum options for utilities with other more popular networking technologies, including unlicensed radio frequency (RF) mesh technologies, existing point-to-multipoint technologies like that of Sensus, public cellular, power line carrier (PLC) technologies, and others.
As it turns out, the TCO for each of these can vary widely. The rural, low-density nature of cooperatives makes for a very different economic model than that of a municipal utility or a large investor-owned utility (IOU). The results of our analysis can be seen in the table below.
Total Cost of Ownership for Various Utility Networking Scenarios: 15-Year Time Horizon
(Source: Navigant Research)
Is My Existing Network Adequate?
Advanced metering infrastructure (AMI) systems are now operated at utilities serving half of all United States meters. Many utilities will try to leverage those existing networks for distribution automation (DA) or other advanced applications. In some cases, this may be a cost-effective approach. In other cases, however, ongoing maintenance costs and denser equipment requirements will result in high costs over time. Repeater creep—where utilities must continuously add repeaters to a mesh network in order to accommodate growing capacity needs—is a potentially expensive outcome when existing AMI networks are tapped for newer DA functions like Volt/VAR control; fault location, isolation, and restoration (FLISR); or demand response.
Historically, utilities have not been fond of purchasing private spectrum, primarily due to costs, which public cellular service providers have driven higher as their bandwidth needs grow (thank YouTube on your phone for that). More recently, however, there are some private bands available to utilities that may provide a cost-effective solution. Our TCO analysis considered the 700 MHz A-band licenses, which are available today across much of the United States for a relatively modest price/MHz POP (population unit).
Private spectrum ownership is now an affordable option—in some cases, the most affordable option—for a utility looking to deploy a variety of DA use cases across a large or varied territory. When used for a combination of AMI, DA, and even substation connectivity needs, the control and flexibility that private spectrum offers can be very attractive.
For further information on the Navigant Research Total Cost of Ownership Analysis, contact Richelle Elberg. For further information on the regional availability of licensed spectrum, contact Robert Finch at Select Spectrum.