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Home My WebLink About17 Metering Agenda Item # 17 DONNER Public Utility District WORKSHOP To: Board of Directors From: Neil Kaufman Date: July 02, 2008 Subject: Additional Information Regarding Metering of Residential Water Services 1. WHY THIS MATTER IS BEFORE THE BOARD AB 2572 requires the District to begin reading residential water meters and billing on a volumetric basis. Implementation of residential meter reading will require a number of Board actions and will have a financial impact on the District. 2. HISTORY In 1991, the Water Measurement Law (SB 229) was enacted. This law required that water meters be installed on all new commercial and residential water connections as of January 1, 1992. SB 229 did not require the retrofit of meters onto previously existing customers. SB 229 does not require that the water meters be read and does not require billing of customers on a volumetric basis. The District has been installing water meters on all new connections since 1992 and is in compliance with this law. On September 29, 2004, AB 2572 was signed into law. A copy of this legislation is attached for your review. AB 2572 requires that the District begin reading the water meters installed since 1992 and commence billing on a volumetric basis by January 1, 2010. AB 2572 also requires that all connections be equipped with water meters and billed on a volumetric basis by January 1, 2025. On April 16 and June 18, 2008, workshops were held to discuss the metering of residential water services. A three phase approach has been identified to cover the implementation of residential metering and volumetric billing: • Phase 1 is a pilot program to be completed by November 2008 • Phase 2 will achieve compliance with the 2010 deadline of AB 2572 • Phase 3 will achieve compliance with the 2025 deadline of AB 2572 There is no flexibility in the scheduling of Phase 1 and Phase 2 since the deadline to begin meter reading is January 1, 2010. Three options have been identified regarding the implementation of Phase 3. They are: • Delayed Start- Begin installing meters in 2020. Anticipated completion by 2023; • Gradual - Begin installing meters in 2010. Install approximately 500 meters per year for 12 years, anticipated completion by 2021; and • Expedited - Begin installing meters in 2010. Install approximately 2,000 meters per year for three years. Anticipated completion by 2012. 3. NEW INFORMATION At the June 18 workshop, the Board requested additional information regarding technology options and how they are impacted by the Phase 3 implementation alternatives. The Board also requested a review of the Expedited Implementation alternative if the proposed surcharge was ramped-up over a few years. There are two basic AMR technology options available to the District - drive-by systems and fixed-base systems Drive-By Systems The District currently uses a drive-by system for all electric meters and a portion of the commercial water meters. In a drive-by system, radio transmitters are installed on all meters. The radio signal is read by a receiver unit mounted in a vehicle as the vehicle drive around town. The meter reads are gathered only when vehicle is dispatched. Most current drive-by systems have built-in programming to perform leak detection, backflow detection and detect tampering. Most units can also store periodic read data for later download. With some manufacturers, customers can get real time meter read with a hand- held device radio receiver. A drive-by system will work with any of the three Phase 3 implementation alternatives. However, since meters are normally read once a month there is limited ability for pro-active conservation. With drive-by systems, there is a lower level of customer service than with a fixed base system and there is additional effort required for"Special Reads." A Special Read is any time when a meter reading is needed other than the normal monthly read. These include transfers, disconnects/reconnects and high/low bill complaint investigation. In 2007, the Electric Department had over 3,500 special reads. It is expected that the Water Department will have a similar number once metering is fully implemented: • 2,500 transfers • 420 disconnects/reconnects • 610 miscellaneous (includes high/low bill complaint investigation) • First two days of April had 54 special reads • First four days of May had 149 special reads • Worst single day was Nov. 30 with 112 special reads These Special Reads require a significant effort to process. Fixed Base Systems In a fixed based system, a radio transmitter is installed on every meter. However, radio receivers are permanently mounted at locations throughout the District instead of being mounted in a vehicle. The number of receivers varies with the manufacturer and radio technology utilized. An external power source (typically 120 AC) is needed to operate the receivers. The meter readings are then retransmitted to the District Office from the receiver via wi-fi, cellular phone, ethernet, radio or power line. A fixed based system provides all of the functionality of drive-by radio read with along with additional features and will provide the highest level of customer service. These features include: • Data is collected at short intervals (hourly or daily) as opposed to monthly; • With some manufacturers, customers can get meter reads via internet; • With certain meters, remote turn-ons and shut-offs can be performed; • Systems are self-diagnostic, making maintenance efforts more efficient; and • No extra effort is needed for special reads. An example of enhanced customer service involves a customer on Swiss Lane in Tahoe Donner. Since December, the District has been testing meters and AMR systems from various manufacturers. Figure 1 shows the field recorded and expected readings for the customer in question. This customer had a leak of about 1 gpm (1,440 gals/day). Assuming the current rate structure for a %" commercial meter, the cost of this leak is over $3 per 1,000 gallons for a monthly bill of$194.02 instead of$54.64. This situation is potentially problematic for both the customer and the District. The customer was contacted and advised of the leak. She stated that she was aware of the situation and was working to resolve it. However, in many cases customers may not be aware of a problem unless they are contacted by the District. With a fixed base system, these customer leaks can be identified as they occur and District can pro-actively contact the customer. With a drive-by system, it may take weeks or even months before a leak is positively identified. All fixed-base systems will function well with the Expedited Implementation of Phase 3. However, depending on the radio technology used, they may not function as well with a Gradual or Delayed Implementation. Other Significant Issues Besides the drive-by versus fixed-base issues discussed above, there are a few other significant issues that need to be considered during the RFP process. • Most manufacturers use different radios for drive-by and fixed-base systems. Therefore there is limited opportunity to migrate from one system to another. • There is no standardization between meter manufacturers and AMR manufacturers. Almost all meter manufacturers also sell both drive-by and fixed-base AMR systems. Most of these AMR systems do not interface well with meters made by competing manufacturers. There are two third-party manufacturers that make only AMR systems and do not manufacture meters. These two AMR systems will work with a wider range of meter manufacturers. • Most of the AMR system manufacturers also offer a corresponding electric meter. There are two drive-by systems capable of reading the District's existing electric meters. There are not any fixed-base systems capable of reading the District's existing electric meters. Cost Implications The cost of the meter-mounted radio transmitter is essentially the same for both drive-by and fixed-base systems. For drive-by systems, the costs of the vehicle mounted receivers are competitive between manufacturers. For fixed-base systems, there is a wider range of costs. Different manufacturers use different radio technologies and have different requirements regarding the number of fixed radio receivers and the mounting heights of the receivers. There are fixed-base systems that are cost competitive with drive-by systems. Expedited Implementation Surcharge The June 18 Workshop discussed a fixed surcharge or $5.88 per month associated with the Expedited Implementation alternative. This surcharge would be implemented in January 2009. However, if the District decided to lessen the immediate impact to its customers, the surcharge could be ramped-up over two or three years as shown in the table below. Type 1st Year 2nd Year Remaining Years Fixed Surcharge $5.88 $5.88 $5.88 2-year Ramp-Up $3.07 $6.14 $6.14 3-year Ramp-Up $2.50 $4.75 $6.33 4. FISCAL IMPACT The fiscal impact of fully implementing residential water metering is significant and may approach $10,000,000. The Water Department's FY 2008 budget includes $265,823 for the Phase 1 Pilot Program. The budget anticipated that this cost would be paid from the cash balance in the Reserve for Future Water Meters Fund. 5. RECOMMENDATI N Re ' w t is port and rovide direction to staff regarding the preparation of an Action Plan. Ed Taylor Michael D. Holley Water Utility Manager General Manager Figure 1 Water Usage at Residence on Swiss Lane 100 80 ---- ---- -- -- ----70 -- li 0 x d c o - — - 0 40 ------ --- ---- ------ ---- ----- - Field Recorded Data - Expected Data 30 +-- ---- ---- ----- ----- --- 20 -- --- --- - -- ----- ---- 10 —-- ---_ -- - --- - - - ---- -- -- ----- 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour i