High Cost of Smart Water Meters Slows Adoption by Utilities

By Amena H. Saiyid

In a world of smart phones, smart cars, and smart appliances, drinking water utilities are striving to keep pace, installing smart meters that send real-time data about usage, leakage, and water quality.

The migration has been slow, however, mainly because of their high cost, according to the head of DC Water, the utility serving the nation’s capital.

The cost of installing a smart meter is a “heavy lift no matter what the size of the utility,” George Hawkins, DC Water’s chief executive officer and general manager, told Bloomberg BNA.

On average, a regular analog meter would cost $25. The average cost of installing a smart meter at each house in the nation’s capital is coming out to be $180, according to DC Water, which which distributes drinking water and collects and treats wastewater for more than 672,000 residents and 17.8 million annual visitors in the District of Columbia.

Only about 20 percent of U.S. drinking water utilities have adopted the new technology, while about 60 percent of the country’s electric utilities use digitized smart meters, according to a recent report by the Energy & Utilities practice at business consultants West Monroe Partners.

Cost as Barrier

The report found that two thirds of the 700 surveyed water utilities cite cost as a barrier to implementing smart meter technologies, especially among small- to mid-sized utilities. A smart meter can cost as much as seven times as much as the regular, analog, spinning meter.

“Smart,” or advanced, meters are a vital part of water infrastructure that can provide a remote and constant two-way data link between utilities, meters and consumers. They do so by measuring water consumption or pressure or leaks and transmitting that data digitally at regular intervals to the utility control room. They are usually installed on the utility’s service line between a homeowner’s property line and the public domain.

DC water had to take some of their employees away from their regular jobs to help with installing and configuring the utility’s network to integrate smart metering.

“We can afford to take people offline and spread our costs, but not all utilities can afford to do that,” Hawkins said.

A smart meter incorporates transmitters and fixed “nodes” around the city that collect data and relay it to the utility, Hawkins said. The metering system uses software to receive and analyze the data, and staff has to be trained to interpret the data for day-to-day decisions, he said.

Fragmented Nature of Industry

Other factors inhibiting adoption of smart meters is the fragmented nature of the drinking water utility industry compared to the consolidated electric utility sector, Peter Mulvaney, senior manager for West Monroe’s Energy and Utilities who specializes in delivering water management services, told Bloomberg BNA.

He said 50,000 water utilities provide water service compared to the 3,000 electric utilities that distribute power.

“Fragmentation makes market penetration very difficult because each utility is responsible for making the investment,” Mulvaney said, making the case for regional water utilities that would be able to pool resources and data.

Hawkins agrees with Mulvaney. He said the region’s utilities could benefit from pooling data they receive from their customers in an attempt to make operations better.

Cautious Industry

Water utilities are risk-averse and tend to err on the conservative side because they can’t afford to cause a public health crisis by delivering water that is unsafe, according to Mulvaney.

“Water utilities are late to the game” compared to electric utilities, Mulvaney said.

West Monroe found that most water utilities, including DC Water, are using smart meters to detect leakage in addition to providing billing services based on water consumption. Smart meters also are being used to detect pressure variations, which can indicate a problem in the pipes.

DC Water is among the nation’s water utilities that have been quick to adopt technologies that will improve its capability to respond remotely and immediately to problems with water treatment and delivery, Hawkins said.

In March, the utility announced plans to replace the city’s 89,000 meters over the 18 months with a new version of meters that detect leakage if the consumption rate rises suddenly, utility spokesman Vincent Morris told Bloomberg BNA.

Improved Efficiency

Morris said the new meters, which will be accompanied by a small transponder, will yield multiple benefits for the utility and the consumer. The new meters will transmit the information to six data nodes that the utility has installed around the city that in turn will relay it to the control room at the utility.

“We can remotely respond to any data of leakage by turning off the water delivery,” Hawkins said.

Related to smart meters is another device that the utility is planning to test on its sewer systems. This technology, which Xylem Inc. has developed, would allow the utility to shut down the pumps if it detects a problem.

Mulvaney sees smart meters as the way to make delivery and treatment of water more efficient and reliable.

“If we only use these meters for billing purposes then its use is very limited, but we can use this infrastructure to provide us with a picture of the watershed,” Mulvaney said. “We not only find out about the movement of water through the ground, but also through the pipes.”

To contact the reporter on this story: Amena H. Saiyid in Washington at asaiyid@bna.com

To contact the editor responsible for this story: Paul Connolly at PConnolly@bna.com

For More Information

West Monroe's "State of Advanced Metering Infrastructure and Data Analytics Adoption in the U.S. Water Utility Industry" report is available at http://src.bna.com/o7J

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.