Power distribution utilities in the state of Rio de Janeiro, Brazil, have historically faced enormous energy losses. These losses, which top 24%, are caused mainly by theft.
One could be forgiven for assuming that Rio is one of the poorest states in Brazil, but this is not true – Rio has the fifth highest HDI in the country, among 27 states. The root of the problem is mostly social and cultural, as indicated by a study done by two Brazilian universities. The chaotic urban occupation, the high incidences of violence, and the rising number of slums create an atmosphere that favours illegal practices like energy theft.
When the Spanish Endesa Group bought Ampla in 1998, it tried to apply traditional methods to reduce theft (e.g. inspections, normalisation and punishment of illegal users). These methods had been very successful in the Group’s other South American companies (Chilectra, Codensa, Edelnor and Edesur). But in Rio the cultural roots of the illegal practices made the challenge very hard for Endesa. As a result, total losses reduced by only 2.1% between 1997 and 2003.
Ampla focused on two initiatives to address the problem:
• Adoption of technology to prevent energy theft and bad debt.
• Social actions in the most violent and poor communities to educate people about energy efficiency and the consequences of theft, and to position the company as a partner of the population.
THE BIRTH OF THE DAT NETWORK
The first step on the technological front was to test a new design of distribution network. We created the DAT Network, which basically protected the low-voltage network by putting it on the same beam where the mediumvoltage network was located (see Figure 1). By doing that, the illegal connections to the low-voltage cables were practically eliminated. The new design was applied mainly to those areas where most of the non-technical losses occurred, and involved 95,000 customers.
The results for 2004 were astounding:
• Total energy losses in areas with the new technology went down from 53% to 10%.
• Collection index ($ collected/$ billed) went up from 97% to 101%.
• Number of disconnected customers reduced by 38%.
• Total debt reduced by 26%.
Figure 1 – The DAT Network
Figure 2 – The Ampla remote operation system
The new network prevented direct connection to the low voltage network, avoiding theft and creating the right incentives to pay. However, since the customer’s meter was still located inside his property, some customers continued to steal energy by tampering with the meter. We still had to send inspection crews to the field to look for meter fraud in the transformers with higher losses.
If we were to have a safe network, we realised we would have to find a new way to protect the energy meter, which was the only vulnerable part of the new solution.
THE BIRTH OF THE AMPLA NETWORK
In order to protect the energy meter, we started to look for new technologies. We talked to more than 12 technology and/or meter suppliers in order to define 4-5 pilots to be tested in our new network. We felt it was important to codesign a solution with the supplier instead of using off-theshelf solutions; we wanted to have different solutions that could be integrated to our commercial information system.
Eventually most of the solutions we co-designed converged to concentrated metering associated to remote operations (reading, connection, and disconnection). The combination of the DAT Network with remote operations was named the Ampla Network.
Our remote operation system was composed of three main elements (see Figure 2):
• The concentrators were installed at the end of the same beam where the medium- and low-voltage networks were located (see Figure 3). Each concentrator could contain up to 21 single phase meters. They would also have bi-stable relays that allowed connection and disconnection of individual customers. The meters in the concentrator could read active energy, and, in some cases, variables such as reactive energy, voltage, and instant demand. In addition, some suppliers offered meters that could be upgraded to prepay or that could disconnect clients for a predetermined period at times of peaks of tension or demand. Finally, the concentrators located at poles with a transformer had a meter for that transformer, allowing us to do real-time energy balances to detect circuits with losses.
• The collectors and MCCs (communication modules) were responsible for collecting and processing the information of 500-1000 customers (50-120 concentrators). The collector was connected to an MCC, an intelligent modem developed by Synapsis. The MCCs were responsible for the wireless communication with our commercial system. This set was installed in a box located at the top of a pole (at the end of the beam).
• The commercial information system was adapted with a new module and integrated with the MCCs to read, connect, and disconnect customers automatically. This was vital to ensure we could perform seamless commercial operations for thousands of customers. The communication between the MCC and the commercial information system was performed via wireless networks. The MCC used GSM standards (GPRS) to establish two-way communications with our control centre. The main difference among the five pilots we tested was the local communication between each concentrator and the collector.
• Landis+Gyr initially used RS 485 cables. The new version of their solution offers radio-frequency (RF) communications.
• Quadlogic offered a PLC-based solution. The information could travel via the low voltage network, the transformer, and the medium voltage network (two-way).
• CAM offered a PLC-based solution for the low voltage network. Since the information could not go through the transformer, they used a capacitive coupler to connect circuits of different transformers. The coupler works as a resistance, but allows the flow of data. By doing that, we were able to reach 200-500 customers per collector (each transformer had only 25-50 customers).
• SMC offered RF-based communication. In addition, the company installed an individual display at the customer’s property that allowed operations of the concentrators via an infrared interface (display-palm pilot).
• IPCOM offered RF-based communication where each concentrator would work as a repeater.
At the beginning, regulatory requirements that customers should have visual access to their readings meant we were forced to keep the old electromechanical meters on customers’ properties. The meters had a serial link with the electronic meter located at the concentrator.
Recently we received a special authorisation from our regulator to eliminate the electromechanical meters and to use the energy bill, short message service (SMS), callcentre (toll-free number) and/or Internet to give our customers information about their daily and monthly consumption. This has benefited the customer, who can check his accumulated consumption not only in kWh (hard to understand) but also in $.
The Ampla Network has allowed Ampla to reduce total losses – in some areas down to 2% (just technical losses). In addition, we have reduced many of the costs associated with reading, connections and disconnections. At the end of September 2005 we had installed the new solution for about 44,000 customers, and we plan to have 500,000 customers on the new network by the end of 2008. This represents almost 25% of our customers, who are responsible for 50% of our nontechnical losses.
Figure 3 – Location of concentrators
KEY FACTORS FOR SUCCESS
The success of an innovative project depends on some principles that we followed when adding remote operations to the DAT Network:
• Create a value network: We established relationships with partners who could work with Ampla to co-design solutions to specific problems.
• Involve people from different areas: We had people from technical areas, technology/innovation, IT/communications, the metering laboratory, and the supply chain involved in the team that conducted the project.
• Adopt modular solutions: It was very important to require open protocols from our suppliers, so that we could couple different concentrator solutions to our commercial system via wireless communications.
• Start with pilots: We initially tested small pilots of about 150 customers each to learn and to minimise risks. The second versions of the concentrators always improved after the pilots.
• Ensure the support of the management team: The CEO and the main VPs were committed to the project and took part in key meetings that defined its direction.
• Adopt the right cultural mindset: Since innovative projects do not always succeed, we had to be open to possible controlled failures (luckily, all the pilots worked). Organisations that do not accept errors hinder innovation.
In short, we do not think a ‘magic’ technological system will solve a company’s problem. The real solution comes from a clear understanding of the underlying problems and a well-thought out strategy, which includes relevant technologies as one of its main components.
Special thanks to Claudio Rivera (Revenue Protection VP at Ampla).