Smart Talk: The Operational Benefits of Smart Meters

There are many customer, operational and human capital benefits associated with smart meters. For now, we’re honing in on how the Memphis Light, Gas and Water Division can operate more efficiently.

As was the case for telephone and elevator operators, and even gas station attendants, new technology meant a new way of doing business. Smart meters will mean change for the Division, too. Chiefly, through job attrition, the Division will realize cost-savings in salaries and benefits—savings we can pass on to our ratepayers. There won’t be any lay-offs. However, as employees leave or move into other jobs they won’t be replaced; lower expenses equals significant savings for our customers.

There’s also an opportunity for significant savings by minimizing electricity transmission and distribution losses. Basically, in transmission a fraction of energy is lost. The difference between what is produced and what is consumed constitute T & D losses. MLGW’s current system losses are about 3.5 percent. In contrast, other utilities are closer to three percent. Using smart meters would help us optimize our electric system and close that gap. Since our annual TVA bill is about $1 billion, decreasing losses by a half percent translates to a $5 million savings annually.

Virtually eliminating utility diversion is yet another benefit. Annually, there are approximately 11,000 instances of utility theft or diversion. This costs the Division millions in uncollected revenue. Smart meters enable utilities to reduce the size and scope of utility theft through a combination of system alerts and daily readings which would reveal evidence of tampering more quickly. 

Another major benefit is the ability to detect and pinpoint outages. While we can’t always predict what the weather will bring, with smart meters we will be able to detect when outages occur and work proactively to restore power. Today, we rely on customer reporting in most instances. Smart meters would alert us instantaneously and get crews working on repairs faster.

From the field to the call center, smart meter implementation will help improve our customer service. For example, if a customer has a high bill complaint, MLGW’s Customer Care Center can review the meter history on demand and work to resolve a customer’s complaint.

The bottomline is that smart meters provide greater access to information for MLGW and our customers, allowing all of us to make better business and personal decisions, optimizing our individual and collective resources.