Benchmarking the billing process

The GBA was established some years ago to focus on telecoms, and the effects of deregulation and competition on the billing environment. Today we have more of a multi-utility focus. Competition has happened or is happening to every industry that was regulated, and there is much that can be learned from those who have already gone through the process.

In telecoms, the advent of competition meant launching services fast. This meant having a system up and running quickly that could bill the service. In most telecoms companies it was expedient to buy a new billing system every time a major new service was launched. The service could be launched quickly, but it also meant one new system to integrate, maintain, train, and probably customise. At least it meant that the impact on other systems was never an issue.

Except that now the major issue for most telecoms companies is consolidation; the objective is to reduce the number of systems from dozens, and in some cases well over a hundred, to close to one. Most companies believe that having one system is actually a pipe dream, but a large, complex telecoms company will be trying for about seven. Some believe that one system, but several implementations and customisations of that system, is the way forward.

Having multiple systems meant a fragmented view of the customer in the telecoms world (you never knew whether an unprofitable Internet customer was actually your most valuable mobile customer, and you still don’t). Energy utility companies looking forward to competition, or beginning to grapple with it, are trying to ‘see beyond the front door’. They are trying to understand the family that lives behind that door – but for the most part it has remained closed.

So CRM issues are common to both worlds. I hate the term CRM – it has become so ‘fuzzy’ that it is almost impossible to define where responsibilities inside the organisation start and finish. In telecoms, for example, billing does not necessarily report to customer service; in fact it seldom does, falling under either finance or IT for the most part. In the worlds of energy and water, though, you have got it right and billing is seen as part of the customer service area.

What can energy utilities learn from the telecoms industry? Would it not be interesting to know how long, on average, it takes a telecoms company to distribute invoices after the billing cut off date, or how long it takes to reconcile 98% of unallocated money, or what percentage of bad debt a telecoms company writes off, or how many are implementing e-billing solutions, and what the take up is, or which function within the business is the major ‘root cause’ of billing errors? And how this changes over time?

I think it would be fascinating, and I think telecom companies have a lot they can learn from energy companies too. Telecoms companies are entering the world of reduced margins, of tighter control; and being able to measure how good, or bad, they are at these things. Being able to learn from other industries would be very valuable.

People steal meters- AMR is simply a theftometer!

 

IURPA

I have now assumed the Chair for the International Utilities Revenue Protection Association (IURPA) which has a long history in maximising the revenues of member companies. IURPA is a powerful tool for revenue protection (RP) professionals to network, problem solve, promote, and define new processes to keep up with the advancements in metering technology. I strongly suggest that companies that are not members of IURPA consider joining us.

Oh, say can you see: Spotting the latest cutting edge utility...

We are all in a rather funny business. In a few areas we’ve seen a lot of evolution and technology – computer based automation, for example. But it has taken 100 years for residential electric metering to graduate from the induction mechanical meter to solid state metering. It has taken 40 years for AMR to evolve from serving a few thousand meters to serving a few tens of millions of meters, but this just scratches the surface! There is still a long way to go.

Redefining AMR – From meter reading to customer communication network

To deliver the products and services expected by a constantly changing consumer base, utilities need to change how they view automated meter reading (AMR). The first step required by utilities is to shed the old mentality that AMR is just meter reading, and begin developing creative ideas based on services that consumers demand, as well as developing processes that cut costs and increase system efficiencies. With the technology available today, metering automation can be easily transformed into a virtual energy information network used by both the energy consumer and the utility.

Advanced communications: The number one reason to install new meters

A survey by Newton-Evans Research indicated that the number one reason why electricity utilities are upgrading high-end meters is to take advantage of advanced communications capabilities. Many utilities are using these advanced capabilities to improve current applications, as well as make their systems compatible with new and future communications advances.

Deployment of high-end electronic revenue meters began about 30 years ago, and since then we have seen great advances in the communications technologies used by electricity utilities. The first electronic meters of the 1970s provided ‘communications’ capabilities that simply emulated those of electromechanical meters – specifically pulse inputs/outputs, or KYZ (as they are known in the ANSI metering community). Each KYZ pulse indicated a fixed amount of energy – for example 1.8 watt-hours in secondary units. These KYZ outputs were typically connected to external pulse recording devices or to SCADA RTUs. Many of these installations exist today in systems that use electronic meters to send energy information to SCADA RTUs using KYZ pulses.

In the 1980s, dial-up telephone modems became inexpensive enough to be used in high-end electronic meters. This was one of the first remote reading technologies to be widely deployed, and dial-up modems also enabled frequent retrieval of load profile data. Instead of waiting a month to retrieve pulse recorder data, the electricity utility could now retrieve meter data as often as needed – say weekly or daily. This capability can be very important for large industrial loads. Retrieving load profile data on a frequent basis can help utilities detect metering problems much sooner, such as in the case of loss of a voltage input from a potential transformer. Similarly, a loss of communications (for example, a failed telephone line) can be detected and corrected before the monthly billing date. Dial-up communications has become one of the most common forms of high-end metering communications, especially for loads of 1 MVA and above. It remains a very important form of metering communications.

In the 1990s, more utilities started using wireless technologies to emulate circuit-switched wire-line communications. Wireless technologies enabled remote meter reading in situations that would otherwise require expensive line installations, such as crossing a car park to reach the meter. Analog cellular or GSM voice networks enabled communications with these difficult-to-reach meters.

We are now seeing increased use of computer and telecom networking technologies to fulfil all kinds of electricity utility automation functions, including metering. Many substations are being upgraded to use higher-bandwidth technologies, including fibre-optics, SONET, satellite, DSL, and Ethernet. Because Ethernet has become the standard for interfacing equipment to data networks, there has been increasing demand for high-end meters equipped with an Ethernet port.

Ethernet provides many advantages for high-end metering applications. Probably the most significant benefit is its inherent ability to support multiple functions over one communication line. With Ethernet we can use one communication connection for all of the following applications:

Designing a 20 year-old AMR device

The utility industry has aggressively sought new ways to cut costs, increase efficiencies and improve cash flow. This search has led to the growing use of Automatic Meter Reading (AMR) systems to reduce the expenses associated with manual meter reading.

 

 

Sensus metering systems 1

Widescale acceptance of AMR technology hinges on AMR  device manufacturers demonstrating to the utility market that the initial investment costs associated with installing advanced AMR systems can be cost justified by long-term savings.

Sensus Metering Systems, a leading manufacturer of water meters and AMR solutions, wanted to deliver the highest possible return on investment to customers purchasing the Sensus RadioReadTM system. This system provides a complete package of AMR applications for the water market, and incorporates the Sensus Meter Transceiver unit (MXU).

Attached to water meters located underground, in basements, vaults or on the outside walls of buildings, the Sensus MXU 505C provides efficient remote meter reading by eliminating visual inspection. The MXU 505C communicates with Sensus’ hand-held or vehicle-based meter reading interrogators.

When a valid wake-up signal is received from an interrogation unit, the MXU 505C begins the communication process with the meter and then transmits information back to the interrogating device using Direct Sequencing Spread Spectrum (DSSS). The use of DSSS technology offers important advantages, as it is virtually immune to noise and interference, therefore ensuring reliability.

After the MXU transmits the meter’s encoder identification and meter reading to the interrogation unit, the interrogation unit signals that valid reading parameters have been met and instructs the MXU to power-down. This power-down mode allows the MXU to conserve energy until the next interrogation session. The unique combination of two-way communication and power saving application provides the most robust and reliable RF unit in the market.

The MXU is a feature-oriented product that guarantees high reliability and reading consistency. Able to connect with up to 16 meters with one unit, the MXU offers features such as remote programming, cycle codes, passwords and diagnostic capabilities. They offer flexibility in meter reading applications and minimise long-term maintenance costs.

Myths and margins

How often do we hear comments along the lines of “there is no margin in energy retail” and “the greatest value for energy retailers is derived from large commercial and industrial (C&I) accounts”? The answer is probably “fairly regularly”, and observations such as these could be attributed to energy industry executives and commentators the world over.

Let’s Dance, Partner!

Have you noticed how many companies are eager to claim that they have “partnered” with a customer who is using their products or services? Partnered? What does partnered really mean? Does it simply mean that one company bought something from another? An attorney will tell you that a partnership has some special meanings in the law. But that kind of partnership is not what the public relations people were thinking about. Has the term “partnering” simply become an overused and now meaningless cliché? Has it been stripped of any real meaning by the advertising agencies and marketing communications departments? Partnering indeed!

The announcement of a partnering relationship is supposed to create the impression that the relationship between the customer and its supplier is something a whole lot deeper than a mere commercial transaction. This is something really special. It is a marriage announcement!

Presumably the parties to this arrangement first learned to dance – that is, to talk to one another and spend time together. Then they dated. Perhaps the customer actually visited the supplier’s factory or offices, and certainly the supplier visited the customer’s facilities. Finally the future customer actually bought something. At last, this was the wedding, the marriage! And the couple wandered off into the sunset, hand in hand, happy ever after.

But wait, is this a marriage of interests or is it really just a commercial transaction, fluffed up for a press release? Partnering sounds better than A bought something from B.

OK, so the “partnering” word is sadly overworked. It is hard to conceive of a utility “partnering” with its supplier of ball point pens or hard hats. But there are some cases where there must be a marriage between the supplier and the utility. AMR is a prime example. Yet it is amazing how many utilities don’t seem to get it. It is amazing how many utilities don’t understand that the selection of an AMR vendor creates a 15 year marriage, whether the utility likes it or not. It can be a good marriage or a bad marriage. The marriage can start out well, and remain cordial and productive. Or it can start off badly and end in a nasty divorce a few years later.

There are utilities that blatantly abuse their position as potential buyers – even before the “first dance”. They begin by inviting parades of vendors to make “dog and pony show” presentations, again and again. They follow this by writing poorly conceived RFPs (Request for Proposals) that require AMR vendors to produce massive and very costly proposals, although a much simpler RFI (Requests for Information) would have done the job at this stage. This process too often begins before the utility has even figured out what it is really looking for, or whether there is any budget available. It escalates. Next come more costly presentations, and more RFPs and more proposals, even by vendors who really do not have a chance. No wonder the attrition of AMR suppliers is so high!

Utilities sometimes forget that the vendor has a business to run and a payroll to meet. A few utilities forget that if an AMR vendor cannot make a reasonable profit, that vendor will simply not survive. The streets are littered with failed AMR companies that “gave away the farm” as they tried to penetrate the market. Too many utilities have unreasonably squeezed the vendor on price and other terms, to the point that the vendor eventually fails, leaving utilities stranded with equipment that is no longer supported. That is a “lose-lose” strategy!

Enlightened executives of well-managed utilities will ensure that their AMR vendor of choice is making a reasonable profit – every step of the way. These executives are smart enough to know that a relationship that starts off badly often gets worse. They know better than to demand unreasonable and very costly concessions from a struggling vendor with the arrogant view that “they need us more than we need them!” They work to build strong and mutually profitable relationships with good vendors.

The most successful relationships between utilities and AMR systems suppliers are built on trust, candor and open co-operation. A utility steals part of that vendor’s chance for survival by allowing a vendor to prepare a costly proposal when there is no realistic chance that that vendor will be selected. A utility that asks the AMR vendor community to spend hundreds of thousand of dollars on presentations and proposals, and then never buys anything, has very questionable ethics.

OK, so we see that the word “partnering” does have its place after all. If there ever was a place where partnering is essential, it is in the procurement and deployment of AMR systems. The seeds for a promising relationship between the utility and the vendors that serve it start with the very first dance, and all the interactions that follow. A long and happy marriage depends upon the relationship being a win for both parties!

Benchmarking the billing function

For three years now, the GBA has been conducting an annual benchmarking survey amongst its biller members. So far, this has been focused on the telecoms market. However, as deregulation begins to bite and competitive advantage, either through operational excellence or through diversifying service offerings, is of ever-increasing importance, so the need to be able to measure billing processes via an independent third party becomes more attractive.
GBA

The benchmarking survey measures eight key parts of the billing process, from order entry and data capture, the most common reasons that bills are inaccurate, through to vendor response times, billing efficiency and ultimately to payment handling, collections and fraud.

For several months now, the GBA has been working to convert this telecoms benchmarking work into a framework that is suitable for the energy utilities world. As part of this effort, the beginnings of a methodology is emerging that will produce an independent, standardised way of measuring the Cost to Serve.

This model will be developed further over the coming months. As in the telecoms industry, the work and areas to be measured will be driven by the Billers’ Club.

As part of the initiative to constantly improve the value that the GBA brings to its members, it is in the process of establishing relationships with information providers, consultancies and subject matter experts in the fields of revenue assurance and CRM. With this in mind, an extension to the benchmarking project that will emerge in the near future is a CRM focus, and one that allows companies to measure how effective the links and interfaces (both technical and business) are between billing and CRM.

Ultimately, as the GBA continues to develop the benchmarking models, the opportunities to measure billing processes not only against peers and competitors within the same industry, but across different industries and regions will emerge. This is where the real value will lie.
If you are interested in helping develop this model and methodology, please contact Alex Leslie at the GBA – alex@globalbilling.org.

Fast forward AMR designs with advanced ICs

Today, the power industry faces ever-increasing customer
demand, straining systems across the globe. Even as the
industry takes further steps to ensure reliable service, providers can benefit from early-warning technology to prevent outages caused by excessive demand. In order for utility providers to better realise and test new technologies, the metering industry must turn to advanced integrated circuits (ICs) that are capable of making meters more accurate and reliable, and that incorporate automated meter reading (AMR).

Besides higher data accuracy and reliability, AMR-enabled energy meters offer lower customer service care cost and lower meter reading cost. E-meter manufacturers are rapidly upgrading their designs to implement new AMR technologies. By offering features such as data transmission over power line and remote communication via network, meter manufacturers can enable energy providers to detect, identify and resolve power outages remotely and expedite a solution.
Discerning customers will value receiving detailed individual information, increasing their trust in their bill’s credibility. Consumers can take advantage of cost incentives such as multi-rate billing or pre-pay energy with smart card prepayment. Adopting rate incentives can encourage customers to reduce peak usage, thereby leading to cleaner power distribution, fewer spikes in power generation and reduced need for more energy plants.

To meet the stringent requirements of advanced electronic energy meters, many manufacturers have relied on custom application-specific integrated circuits (ASIC) that offered mixed-signal solutions. ASICs can be expensive, requiring non-reoccurring engineering cost and extending both design and production lead-times. A better option is to use standard catalogue products that solve similar problems for multiple customers at a lower shared cost. These ‘application-specific standard products’ (ASSP) are excellent choices, since they offer high performance analog and low cost digital circuitry and reduce manufacturers’ time-to-market.

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