AMM Systems in Deregulated Electricity Markets


AMR and AMM system issues have been widely discussed in previous issues of Smart Energy International, and many authors have emphasised the importance of initially setting the drivers and subsequently defining the corresponding technical solutions that will offer the best benefits for utilities.

When deregulation reaches the residential market, the utilities’ viewpoints, the market regulator’s position, the distribution company’s specific mission and the expectations of new energy suppliers should all be taken into account. When open competition and consumer benefits enter the picture, new drivers emerge, mainly related to open and interoperable systems.

AMR/AMM systems in the residential field are mostly handled by utilities, who usually distribute power, meter energy, invoice bills and collect revenue from their consumer base. All these functions are part of a comprehensive AMR/AMM system, but when deregulation reaches residential consumers they are shared among several market players, including distribution companies (usually unbundled from former utilities, but remaining under regulatory control) energy providers and energy suppliers. Regulators, who are responsible for setting ground rules to enable healthy competition to enter the residential electricity market, need to be able to predict the future dynamics of the market place.


The first available benchmarks are existing implementations in the commercial and industrial segments. The commonly accepted concept at the C&I meter point is load profile storage associated with data collection systems, using public communications networks such as PSTN or GSM. As metered data can be standardised, there is no need to reprogram the meter point according to which supplier the consumer selects. With initial programming usually controlled by the distribution company, it is easy to transparently and seamlessly  upgrade communications media as more efficient technologies, or networks such as GPRS, become available.

Transposing this type of C&I scheme to the residential segment to serve millions of consumers would not be cost-effective, as it would increase the data load by a factor of 100 to 1000. It would also be difficult to manage, and would add costs to the electricity system that would be borne by consumers, contrary to deregulation goals.

How then could the five-registers-per-month concept be managed in a competitive residential market place? A major consideration is that the meter point might have to be reprogrammed when a consumer signs up with a new supplier. As bulk electricity prices have limited flexibility, new suppliers will probably penetrate this market with innovative billing concepts like off-peak or weekend rates, so the meter registers will have to cope with an evolving scheme.


And who would implement the system? Distribution companies could carry out reprogramming on behalf of suppliers, although their position is sensitive because, when deregulation becomes mandatory, they will have to manage parallel residential sub-segments – one for consumers under new market rules and one for those still under the former regulated supply. In most countries, migration from the regulated system will take years: once distribution companies are independent of utilities, they may face possible accusations of interfering in day-to-day operations to protect their former organisations.

Market players’ roles could best be clarified by letting new suppliers manage their contracts directly with consumers down to the meter point, provided that:

• the two-way communication channel to the meter is openfor approved suppliers
• communication protocol is standard and fully published
• data architecture is also fully documented.

This system is already available, thanks to cost-effective new communication media such as GPRS and the latest developments in metering communication standards such as the IEC 62052 and 62056 series.

An available model should also be considered at the initial, payment meter technology stage of AMR/AMM implementations. Although primarily used for prepayment, this technology can easily be turned into an AMR credit-based system by configuring the meter to continuously supply energy with a large allowance of debt. The limited system costs are usually shared with other commodity vendors, and payment technologies are also being standardised in the IEC 62055 series, offering interoperability.

Open, interoperable AMR/AMM systems are essential for the success of deregulation in residential markets, especially when new systems are considered over their lifetime. The pace of progress in metering is dictated by that of technology development in communications, and as sustainable development concerns escalate, a flexible system is a prime asset. When new AMR/AMM systems are designed, upgradeability of the communications media will guarantee that the system continues to provide the best service at the best overall cost.