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• A scalable and flexible MDM system is a critical component that should be installed as a precursor to AMI
• Do not underestimate the cost and complexity of MDM
• Realization of AMI & MDM benefits will require easily adaptable interfaces with multiple business processes and systems.
• Deployment over several years will require the strategic management of benefit realization.

Commercial and Industrial Endpoints

DTE recently selected EnergyICT's EIServer^® as its MDM software. EnergyICT's EIServer^® software will be used to directly collect and process interval meter data from 20,000 commercial and industrial accounts. This software will also provide a central hub for all new AMI technologies for DTE Energy's 2.7 million electric and 1.3 million gas meters.

One of the key motivations for DTE considering meter data management was to replace or upgrade their customized MV-90 system for their commercial and industrial (C&I) meters. Their version of MV-90 and the underlying database were no longer supported. Cloutier noted that there are a number of vendors of MDM software that could provide the complex billing determinant calculations required but DTE was looking for one system to call 20,000 existing C&I meters over telephone, cell phone, and IP, using multiple protocols and perform the complex billing calculations. EIServer demonstrated that it could accomplish the task—for example, EIServer is used to collect interval data daily from over 56,000 meters in the United Kingdom—and DTE was impressed with the open architecture of the software and ease of use.

DTE currently plans to roll out AMI to 4 million endpoints across its service territories, and that number may grow significantly if DTE were to expand its distribution territory. DTE was looking for a scalable MDM solution that aligned with its IT architecture strategy which includes open systems architecture. DTE Energy evaluated MDM solutions on 234 functional requirements, as well as on cost, vendor business assessment, other utility experiences with the vendor, on-site demonstrations, service and support. Several business areas along with the IT department played a role in selecting the MDM system.

DTE Will Host MDM System

Most large utilities are opting to host their MDM system in-house and DTE will do the same. DTE considered outsourcing the service but decided security issues, the complex integration required with other systems and the high volume of transactions increased the risk. In addition, DTE has a strong IT support structure and has traditionally not outsourced IT services.

To support the installation of the MDM system in-house, DTE will utilize approximately 15 full-time staff and another 10-15 part-time staff on its team. The following new hardware infrastructure will be deployed to support the MDM system at DTE:

• Four servers for interval meter communications,
• One web server,
• One job server for the interfaces,
• One database server for the meter data and MDM server application code,
• A duplicate of the above for their offsite backup center,
• Additional servers for development, testing, and training.

MDM Before AMI

The main driver for the investment in MDM was to replace the customized MV-90 system which had served them well for many years, but was at the end of its useful life, and to provide a solid foundation for its AMI rollout. However, Cloutier also said DTE would have gone forward with MDM even without its planned rollout of AMI. DTE decided to do MDM before AMI for the following reasons:

• Most utility billing systems are designed to store only monthly billing reads.
• Most AMI systems are set up to store 30-90 days of daily or hourly energy and event data.
• Several peer utilities with AMI fully deployed reaped significant benefits, and are now installing MDM systems to further leverage AMI benefits.
• Multi-year AMI deployment plans require the management of transitional meter data collection systems.
• The ability to fully integrate disparate AMI technologies into one unifying platform is critical to achieving maximum AMI benefits.
• Leveraging meter data across a utility enterprise requires a robust and flexible MDM solution that quickly adapts to changing business needs.

AMI/MDM Business Case Development

DTE focused on the technical aspects of its AMI requirements and on building a robust financial model. DTE discussed its plans for AMI with peer utilities (PECO, Ameren, PPL, SCE, PG&E, Wisconsin PS, BG&E, Duke, Progress Energy and Niagara Mohawk) and learned that MDM was essential to avoid throwing meter data on the floor. Since most AMI systems are designed to store data for only two to three months, historical hourly meter data was not readily available for some utilities until they installed MDM. The team at DTE presented its business case to DTE management, and modified the business case with input from multiple DTE stakeholder groups, unions, regulators, and the company Executive Council. If a challenge was made, the team analyzed the challenge and was ultimately successful in making the case for investing in MDM first, followed by an investment in AMI.

Boom in AMI is Officially Underway

One method used to evaluate risk was to run Monte Carlo simulations for selected business benefits, including the holding company, considering a number of different factors that might impact the costs and benefits of AMI. One of the risks considered is due ironically to significant growth in AMI from sales to other large utilities in North America. AMI providers may have difficulty meeting the production volume for DTE while maintaining product quality due to other large utilities possibly ordering the same products (AMI endpoints and network infrastructure equipment) within the same time frame as DTE. DTE has seen some evidence of this already in the feedback received from its six AMI vendors responding to the RFP for AMI. Expectations for this year are:

• SCE is expected to select an AMI supplier for 5 million endpoints,
• SDG&E for 2.1 million,
• Ontario utilities for additional 3 million,
• Consumers Energy for 3.4 million,
• DTE for its 4 million,
• And the list goes on.

As shown in the above chart, announcements for large (over 100,000) AMI deployments for electric, gas, and water endpoints increased by over 200 percent in 2006 over 2005 levels. In 2007, it's likely we will see another increase of 25 percent over 2006 levels. As these announcements result in actual production activity in coming years, AMI providers will enjoy record sales and will need to increase production levels over and above anything seen before.

DTE expects to make a selection for AMI in mid-2007 if all goes according to plan. As the AMI system is rolled out, DTE will work with its MDM vendor to leverage the value of AMI by implementing additional functionality. Outage management is one of the key functional areas that will be addressed one or two years into the AMI rollout and is currently in the design phase. DTE is one of 15 large utilities that UtiliPoint is forecasting likely to select an AMI vendor for a large deployment in 2007 following seven large deployments announced to date for 2007. As one large utility recently stated, it's no longer a question of "if" but "when." Most of these 22 utilities have either invested in meter data management or have plans to implement meter data management before or along with their AMI deployment. Without MDM, utilities will end up throwing data on the floor, something DTE plans to avoid.