Is there a ‘right’ communications method for AMR?


As one examines the statistics reported on the 33 million AMR devices shipped in the United States, clearly radio frequency (RF) communication methodologies dominate this market.

The further dissection of this data shows that the RF-based AMR systems are predominantly simplex and are defined as either one-way or one-and-a-half way. One-way systems are where the end unit periodically ‘chirps’ its information to a nearby receiver. One-and-a-half way systems are those where the device is awakened by a receiver and begins to transmit its data for a period of time. In both cases, the receiver can be a hand-held unit carried by the meter reader, a van-based or mobile unit, or a fixed radio network with devices permanently mounted on light standards.

While there are other RF systems that operate in a two-way mode (bilateral ability to send or receive data) they often use public networks such as paging, cellular methodologies, or private fixed radio systems. Similarly there are hybrid systems that use a mixture of RF and other communications methods to achieve a two-way system, but these techniques are much less prevalent. The breakdown of these approaches is shown in Figure 2.

There is a clear preference for RF solutions among the various utility sectors, as shown in table 1.

Although each utility type has its own unique needs, traditionally there are economic, technical, business, political, functional and operational issues that must be considered in the choice of a network solution. Each of these areas of concern may shed some insight into the rationale behind the trend to use RF.

Other communication techniques such as telephone and powerline communications (PLC) offer some distinct advantages over RF. It is, however, often a delicate balance of trade-offs of multiple factors that can drive a particular technology choice as the primary means of communicating with the meter.


The decision to implement AMR normally begins with an economic feasibility study. Few utilities can justify any system when the metric to meet or beat the simple substitution of technology from a manual process is in the range of $0.50 to $1.50 per month per meter. Clearly other factors must be taken into consideration.

The payback considerations or return on investment (ROI) normally dominate the business case, as the economic supporter looks at minimisation to key base features in an attempt to move the functionality curve towards the lowest cost. 

While the economics of an RF-based system are generally more costly than those of a telephone-based system, one may question why the trends of deployment clearly indicate that RF and PLC are positive, while the trend for telephone based systems is negative. (See figure 3.)

Certainly economics is not the only factor that must be considered. In telephone-based systems, the operational characteristics are generally categorised into two general classes, inbound and outbound. 

Inbound telephone is where the meter interface unit (MIU) initiates the call to the utility on a regular basis or on detection of an exception. Outbound telephone systems allow the utility to use a special access arrangement provisioned in the local telephone office to silently access the customer’s line to awaken the premise device.

The first large-scale AMR system in the United States used the customer’s telephone line as the communications channel between the meter and the utility. These early adopters of technology were often water or gas utilities, which leveraged the prime benefit of using the telephone line – one where the MIU could actually be powered from the telephone line itself, eliminating the need to run extra wires to a source of power or to instal a battery.

While using the customer’s telephone line has some clear benefits, there are distinct disadvantages. One of them is having to share and often contend with the customer for use of his telephone line. In the US, the National Exchange Carrier Association (NECA) notes that the average call duration has increased significantly over the past ten years, growing from an average call duration of 50 minutes in 1980 to over 72 minutes in 2001. While this daily increase may not appear significant, many people now use their telephone line for computer access to the Internet during evening hours, when the utility would normally program its units to operate.

To compound this, the growth of telephone numbers to support cellular devices, fax machines and multiple lines in the home has created an explosive number of telephone area code changes. These changes can create havoc within the utility. Care must be exercised even if units periodically call the utility, depending on how the telephone company implements an area code change. Clearly an administrative nightmare and logistical challenge could exist if the number of digits required to dial local numbers goes from seven to ten (geographic overlay). Likewise, within the customer information system (CIS) provisions must now take into account the customer databases, where the fields may change depending on geography (area code split).

Regardless of the telephone access methodology used (either inbound or outbound) once the MIU is connected, the utility has the ability to send or receive data to the end unit. However, the combined challenges of business administration, uncertainty of telephone line availability, telephone number administration, potential inoperability with DSL or digital services, customers’ rights, installation and on-going support are all negative factors that have contributed to the demise of this technology as the AMR communication of choice for the mass market. 

For an electric utility, a natural communications methodology that is often considered is the powerline itself. While some technology barriers such as the high frequency blocking characteristics of transformers create some impediments, the utility network infrastructure and the control and ownership of the resource are contributing factors that have made these techniques more appealing in the AMR industry. Technological solutions have been successfully used to enable bi-directional communications between the end user and the utility.

Economics and technology are not the only hurdles in the choice of a network. A key political factor is whether the utility favours ownership, leasing, or outsourcing. These are hotly debated philosophies that may overpower many of the other concerns.
When it comes to functionality and operational efficiency, the features enabled by two-way systems have distinct future advantages. Many suppliers of two-way AMR systems list some of the additional value-added features enabled by this methodology.

• Demand reset
• On-demand reading and verification 
• Posting of real time pricing 
• Interaction between the end user and the utility
• Remote connect/disconnect
• Load shed verification
• Direct (utility-initiated) and indirect (customer- responsive) load control
• Demand response programmes (DRP)
• Energy management system interfaces.

While there is a growing trend to offer all these two-way enabled functions to the residential mass market, the providers of full-two way systems face the same economic hurdles that utilities face when deciding whether or not to implement an AMR system alone. When a valuation model that focuses mostly on substitution economics places an annual value of $6 to $18 for simple meter reading, any AMR system will be difficult to cost-justify. Since the true economic value of future services cannot be based on historical evidence, some of the assumptions made about savings can be subject to “prove it to me” challenges.

The dichotomy that exists between the popularity of one- or one-and-a-half-way RF systems and other systems that provide two-way communications to the end user, raises the question of whether two-RF systems will gain in popularity as the costs of these systems decrease.

Frequently, the multiplier factor between the current one-way systems and future two-way providers is between 1.3 and 1.6 times the cost of a one-way system. Since economics is often the primary driver, the base cost of RF systems must continue to drop while the cost differences between one- and two-way systems continue to narrow.

The scale of economies theory suggests the cost per unit decreases as the number of units increase, and has traditionally followed an asymptotic curve. However, many AMR suppliers are often asked to offer these units at the proverbial million-unit price when the plans are to deploy only a few hundred units for a pilot and evaluation period.

As more ‘crisis’ situations occur, such as water restrictions and rolling brown-outs caused by grid constraints, the consumer will be more interested in having better information and control of the use of these resources than the utility will be driven to reduce meter reading operational costs.

Clearly more and more utilities are beginning to realise the future value of customised services that a two-way network affords, and are starting to demand features that this capability permits.