Automated Meter Reading
February 26, 2011
1
What is Automatic Meter Reading?
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2
Automatic Meter Reading, or AMR is the
technology of automatically collecting
consumption, diagnostic, and status data from
a water meter and transferring that data to a
central database for billing, troubleshooting,
and analyzing.
Historical Information
3

Automated Meter Reading was first tested
approximately 48 years ago by AT&T in
cooperation with a group of utilities and
Westinghouse.

At that time, the $2.00 per meter cost was four
times the monthly cost of a person to read a
meter at $0.50 cents per meter. As such, the
program was considered economically
unfeasible.
Historical Information
4

In 1977, Metretek, Inc. developed and
produced the first fully automated,
commercially available remote meter reading
and load management systems.

In 1985, Hackensack Water Company and
Equitable Gas Company were the first to
commit to full-scale implementation of AMR on
water and gas meters.
Historical Information
5

Today, many communities throughout the
United States and the State of North Carolina
have already proceeded with the acquisition
and implementation of the AMR Technology for
their water system.

AMR Technology has a proven and well
established track record.
Background Information
6

The discussion concerning the purchase and
utilization of the AMR Technology here in Eden
was first raised by city staff on February 23,
2008.

On May 21, 2008, city staff traveled to North
Wilkesboro, N.C. to see the AMR Technology
in action.
Background Information
7

In early 2009 staff investigated funding
opportunities through the American Recovery
and Reinvestment Act.

In February 2009, a funding application was
submitted to the North Carolina Department of
Environment and Natural Resources through
its Public Water Supply Section of the Drinking
Water Supply Revolving Fund.
Background Information
8

A second funding application was submitted to the
Clean Water State Revolving Fund.

Unfortunately, neither of these funding applications
were approved.

In February 2010, a power point presentation on the
AMR Technology was presented by Ms. Tammie
McMichael, Director of Finance and Personnel.
Background Information
9

As a result of Council’s continued interest in the AMR
system a total of $207,800 was included in the
approved FY 2010-11 budget to begin the
implementation of this project if formally approved by
the City Council.

In June 2010, city staff and Councilman Jim Burnette
attended an AMR Technology seminar sponsored by
Carolina Meter in Greensboro.
Background Information
10

From June 2010, through September 2010, city staff
worked with representatives from Brady Energy
Services to evaluate a number of different initiatives –
one of which was the AMR Technology.

On September 9, 2010, representatives from Brady
Energy Services submit a formal Energy and
Infrastructure Optimization Proposal which included the
implementation and installation of the AMR system.
Background Information
11

The AMR Technology proposal from Brady
Energy Services was $1,899,358 +/- 10%
depending upon the final findings of an
investment grade audit.

On September 17, 2010, I informed each of
you that staff was not recommending the
acceptance of the Brady proposal because we
felt the cost estimate was very excessive.
Background Information
12

At this same point in time, staff received a
preliminary price quote of $1,789,475.82 from
Mr. Brad Bersch of Carolina Meter.

Mr. Bersch noted that this price was a very
rough estimate and he thought the actual cost
would be much lower if we actually decided to
proceed with Carolina Meter.
Background Information

13
While investigating the procurement procedures Ms.
Erin Gilley, City Attorney determined the City could
proceed with the purchase and installation of the
system without the formal development and receipt of
bids under the guidelines of NC General Statutes 143129(e)(6) which states an exemption from competitive
bidding is allowed when the purpose of
“standardization or compatibility is the overriding
consideration.”
Background Information
14

Nearly every meter currently in use within the City of
Eden is a Badger meter and the ability to stay with this
brand and the intended retrofit in lieu of replacement of
approximately 9.37% (656) of our existing active
meters (6,998 as of December 2010) qualifies us for
this exemption according to Ms. Gilley.

We discovered this is the same process that has been
used by many of the other communities who have
already converted to the AMR Technology with
Carolina Meter.
Background Information
15

On September 27, 2010, Ms. McMichael and I
met with Mr. Bersch and Mr. Mark McMillen,
Co-Owner of Carolina Meter and VicePresident of Sales. During that meeting they
gave us a formal price of $1,552,956.74.

In addition, they stated the cost would be good
through September 2011, so staff could
complete its internal analysis and remaining
due diligence work.
Background Information
16

From October – December 2010, additional
due diligence work was completed and an indepth analysis was conducted on each of our
inactive meters – i.e. meters that are in the
ground, are read on a monthly basis but are
not active and producing revenue.

We discovered that 741 meters had been
inactive for at least two years.
Background Information

In an effort to reduce our costs even further we decided to reduce
the number of meters we would be replacing from the original
plan of 7,083 meters to just 6,442 meters.

Active meters as of December 2010:
Minus meters to be retrofitted:
Plus 100 of the 741 inactive meters:
Plus 641 inactive meters not being bought:
17
6998
656
6,342
100
6,442
641
7,083
Background Information
18

As you will see, this reduction in the number of meters
being purchased and installed translates into an
additional savings of $100,396.69.

Due to length of time associated with many of the
inactive accounts and the minimal cost difference
associated with purchasing the meters now or later
(estimated at $13.50 per meter) we did not feel like it
made sense to replace every single meter at this time.
Background Information
19

In January 2011, we received an updated quote from
Mr. Bersch for the AMR system that is $1,452,560.05.

This translates into a substantial savings of
$446,797.95 when compared to the price quoted from
Brady Energy Services which was $1,899,358 and
even a savings of $336,915.77 when compared to the
initial preliminary quote we received from Carolina
Meter at the beginning of September 2010.
Automated Meter Reading

Solving Tomorrow’s Problems With Today’s
Technology
–
Utilities today are being challenged with maintaining
and managing an efficient water system in the face
of


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Declining revenues
Increased operating costs
Infrastructure improvement needs
Current Problems


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
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Prolonged leak detection.
Tamper detection.
Recurring personnel and operational costs for
3 FTE employees to read meters.
Possibility of inaccurate meter readings.
Resolving billing issues.
Revenue loss due to inaccurate meters
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
3 Meter Readers

Reading approximately 161 meters each day
–
6 hours per day eight days straight per billing cycle
– 2 billing cycles = reading 16 days out of 21.75 work days
each month

Handle an average of 406 work orders per month
–


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22
Processed every day from 3:00-5:00
Rereads an average of 50 per month
Leave an average of 30 door hangers per month
Check stop meters an average of 50 per month
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
3 Meter Readers

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23
Cutoffs/Reconnects for non payment an average of 150 per
month
Pull meters for non payment (lock or pull) an average of 50
per month
Replace old meters an average of 5 per month
Allow for weekends, holidays, weather, and personal time
off
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
2 Billing Clerks

After readings submitted–
Run reports for no reads, rereads
– Bills Processed for approximately 7,000 accounts per month
 Approximately 3,500 bills each cycle
 Reviewed
 Continuous bill forms folded/burst
 Stamped and mailed
24
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
2 Billing Clerks

Reminder notices processed for 800-1,000 accounts per
month
–
400-500 reminder notices each cycle
– Reviewed
– Continuous forms folded/burst
– Stamped and mailed
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Cut off list
Pull meters list
Stop meters list
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
2 Billing Clerks

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Handling customer service telephone calls-everyday
Collecting & Posting payments-everyday
–
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26
Approximately 50% of our customers come in the office to
pay
Issue and update work orders-everyday
Current Meter Reading Schedule

Two Monthly Billing Cycles (15th & 30th)
–
2 Billing Clerks

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Balancing cash drawers and making deposits-everyday
Other responsibilities
–
Large Customer W&S Billings
– Billing for Waste Management Services approximately 297
(commercial) bills per month
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As you can see, we can’t afford to let one day
pass us by…..there is a great deal involved in
our monthly billing and collection process
Comprehensive Technology
Solution

Automated Meter Reading System
–
Orion meter reading technology from Badger Meter

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The New Technology Will Meet Our Needs
–
–
–
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656 of our existing meters will be retrofitted with data
transmitters for integration into the new AMR system.
6,442 meters will be replaced entirely with new meters
fitted with data transmitters.
Meter reading
Data analysis
Business operation
The Depth of Our Meter
Reading Technology
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29
There has to be a better way……
Features/Benefits of AMR
30

Low-cost, fast and efficient data collection.

More accurate and precise measurement of water
consumption. Consumers will be billed for what they
are actually consuming.

Elimination of two full-time equivalent positions and
reduced operational costs which translates into a
reduction in actual spending equal to approximately
$97,575 on a recurring basis each year.
Features/Benefits of AMR
31

Promotes efficient operations and conservation.

Ability to be retrofitted on 656 existing meters that are
less than seven years old.

Increased revenues over time. Water meters whether
manual or automated, are mechanical devices that
decrease in accuracy over time. Because many of our
meters are older and less accurate, the City is losing
revenue from both water service charges as well as
sewer service charges.
Features/Benefits of AMR
32

Leak detection capabilities – Meters will
sample water consumption 24 hours a day and
notify the City if water has been running
continuously when the meter is read.

This will assist the citizens in identifying leaks
in a more timely manner thereby reducing the
amount of money they are ultimately charged
on their bills as a result of a leak.
ORION In-Home Display
33

Optional customer
service tool available to
all users

Promotes efficiency and
conservation.

Displays consumption
reads hourly, daily or
monthly or in seven-day
graphic intervals.
Features/Benefits of AMR
34

With the In-Home Display unit customers can monitor
their at-home water use on an easy-to-read, remote
display.

A built-in magnet allows for its location on a refrigerator
or other appliance.

Monitors can be purchased for $135 each and we will
have some on hand for trial testing on a rotating checkout basis.
Features/Benefits of AMR
35

Short payback period per Opportunity Analysis.

Improved call resolution with in-depth data profiling
capabilities for each account.

Minimized needs to access customer’s property to read
meters.

ORION transmitters, batteries and Badger Meter
Encoder Register are covered by a twenty year
prorated warranty.
Features/Benefits of AMR
36

The new system will be comprised of an ORION
transmitter located at the meter that will measure the
water flow then transmit a signal containing the current
meter reading to an ORION mobile reading receiver.

The meter reader simply drives down the street with a
laptop computer device that receives the signals and
records the reads. This information is then
downloaded into the billing system in the Finance
Department office.
ORION Transmitter Features

Unparalleled
protection against
water intrusion

Factory pre-wired,
assembled and tested

No field programming
required

Ready to install!
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Date Profile Viewer - Bar Graph
38
ORION Drive-by Reading System
39

Low-cost, fast, accurate and
efficient data collection and data
auditing.

Touch screen operation

Utilizes an FCC non-licensed radio
frequency band

Transmits latest meter reading
every 4-5 seconds.

Receiver passes readings directly
to PC during download process.
ORION Reading Software
(ORS)Premium Kit
40
Project Cost,
Warranty/Maintenance Agreements
41

Carolina Meter has submitted a price quote for this system that
equals $1,452,560.05.

The ORION Transmitters, batteries and Badger Meter Encoder
Register are covered by a twenty year prorated warranty.

The ORION Mobile Reading System, Trimble Ranger Handheld
and Charging Cradle and the READCENTER Reading Data
Management Software and Route Management Module are
covered by a one year warranty but will then be covered by a
series of annual maintenance agreements.
Project Cost,
Warranty/Maintenance Agreements

There will be some one time programming costs with Logics for
the AMR interface and change-out at a cost of $7,000.

Annual maintenance agreements will be as follows:
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42
Badger READCENTER Annual Maintenance Agreement
$ 1,050
Logics Programming Annual Maintenance Costs
Trimble Ranger Handheld Annual Maintenance Agreement
ORION Reading Software Annual Maintenance Agreement
Total
$ 675
$ 450
$ 2,875
$ 5,050
Reductions in funds allocated for the annual replacement of
meters will be used to offset the costs associated with the
recurring maintenance agreements.
Projected Payback
43

The opportunity analysis information has been
prepared by Mr. Bersch. He will be happy to
address any questions concerning the
opportunity analysis or the AMR system at the
conclusion of this power point presentation.

Two opportunity analysis were included in the
information you received prior to today’s
meeting.
Projected Payback
44

The first analysis assumes existing rates
remain unchanged from their current level for
the next ten years (most conservative scenario
possible).

Based on these assumptions, Mr. Bersch has
estimated a project payback period of only 3.3
years assuming a six month change out period.
Projected Payback
45

The second analysis assumes existing rates
are increased by an annual average of 3% per
year for the next ten years.

Based on these assumptions, Mr. Bersch has
estimated a project payback period of only 3.1
years assuming a six month change out period.
Projected Payback
46

The opportunity analysis preapred by Mr.
Bersch reveal that he is using a 92% water
meter accuracy figure in the projection of his
revenue numbers for all meter sizes of 2
inches and lower.

In addition, he did not include any gains that
may be realized on meters that are larger than
4 inches.
Projected Payback
47

Past modeling in both North Wilkesboro, N.C.
and Pulaski, VA. indicated the opportunity
analysis prepared by Carolina Meter was very
effective.

Mr. Bersch’s approach is very conservative
when compared to the 95% - 99% accuracy
guarantees that were actually offered by Brady
Energy Services.
Projected Payback
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48
Based on our discussions with other
communities who have installed the AMR
system and the guarantees offered by Brady
Energy Services we feel that a 92% water
meter accuracy figure is probably low. This
means the potential payback has a good
possibility of being even less than the
estimates provided by Carolina Meter.
Primary Reasons Other Utility
Providers Implement AMR
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Inaccurate meters
Transition from a bi-monthly to monthly reads
To reduce personnel and operational costs.
Elimination of manual reads
Features and benefits
–
–
–
49
Leak detection
Data profiling
In-Home Monitoring Display
Others’ Experience with AMR
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50
North Wilkesboro, North Carolina
–
Increase in revenue and cash flow. Reading time
decreased by 90%
–
Very satisfied with ORION system and Carolina
Meter.
–
Mr. David Webb, Utilities Maintenance Supervisor
stated it paid for itself in a short period of time.
Others’ Experience with AMR

51
Franklin, North Carolina
–
Mr. Jay Gibson, Director of Public Works stated he
would recommend the ORION system to everyone.
–
Very satisfied with the service and support they
receive from Carolina Meter.
–
Have been using the AMR Technology for two years
and have no regrets.
Others’ Experience with AMR

52
Graham, North Carolina
–
Mr. Frank Maness, Assistant City Manager stated
they have been very satisfied with Carolina Meter as
well as the AMR Technology.
–
Only regret is not implementing the system sooner.
Others’ Experience with AMR
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53
Moore County, North Carolina
–
Ms. Peggy Deak, Customer Service Supervisor
stated, “the ORION AMR System is great!”
–
Realizing an increase in revenues as projected.
–
Very satisfied with ORION system and Carolina
Meter.
Others’ Experience with AMR

54
Aiken, South Carolina
–
20,000 customers on their AMR system.
–
Ms. Kim Abney, Director of Finance stated they
completed installation of their ORION system in May
2004. “The system has been working out great and
has performed exactly as promised.”
–
Would highly recommend the system to any
municipality.
Others’ Experience with AMR

55
Lynchburg, Virginia
–
Mr. Jimmy Austin, Meter Operations Supervisor has
been working with Carolina Meter and Mr. Bersch
for the past five years. He stated that they are
excellent to work with.
–
Data profiling feature is terrific in terms of
investigating customer concerns about their bills.
–
Absolutely no regrets and system has performed as
projected.
Payment Arrangements
56

According to the audited financial statements
for the period ending June 30, 2010 the equity
in the Water and Sewer Fund was equal to
$10,351,396.

This was an increase of $2,266,894 when
compared to the June 30, 2009 equity in the
Water and Sewer Fund which was equal to
$8,084,502.
Payment Arrangements
57

This growth in the Water and Sewer Fund
equity was due primarily to the $2,746,894
payment we received from HanesBrand
International on August 8, 2010 for their FY
2009-10 take-or-pay and capital repayment
obligations.

The equity in the Water and Sewer Fund for
the period ending June 30, 2000 was
$4,345,594.
Payment Arrangements
58

Again, the equity increase from June 30, 2009 to June
30, 2010 is equal to $2,266,894.

This piece of information coupled with the fact that
interest rates on our investment earnings continue to
be at record low levels (.21% - .25%) has resulted in
our belief that we should pay outright for the acquisition
of this system over the course of the six month
installation period as opposed to borrowing funds.
Payment Arrangements

59
Based on the existing lending environment we
can save between $56,698 and $122,411 on
anticipated interest paid minus anticipated
interest earned if we pay for the system on a
cash basis as the project is being completed
in-lieu of either a 3 year or 5 year loanfinancing agreement.
Payment Arrangements
60

Currently $207,800 is included for this project in the
current FY 2010-11 budget.

An additional allocation of $1,244,760.05 will need to
be included in the FY 2011-12 budget which is
scheduled to be adopted on May 17, 2011.

If the Council votes to proceed we will spend the
$207,800 between May 18 – June 30, 2011 and the
remaining $1,244,760.05 during FY 2011-12.
Staff Recommendations
61

Request the City Manager to include an allocation of
$1,244,760.05 (from existing equity in the Water and
Sewer Fund) in the FY 2011-12 budget for the
implementation of the AMR system.

A formal vote by the City Council to actually allocate
and authorize the expenditure of these funds will take
place on May 17, 2011 when the FY 2011-12 Budget
Ordinance is submitted for Council’s formal approval.
Staff Recommendations

62
Authorize the City Manager during the May 17, 2011
meeting of the City Council to proceed with executing
an agreement with Carolina Meter for the purchase
and installation of the city-wide standardized AMR
system as quoted by Carolina Meter under the
guidelines of NC General Statutes 143-129(e)(6) which
states an exemption from competitive bidding is
allowed when the purpose of “standardization or
compatibility is the overriding consideration.”
Staff Recommendations
63

Work with Matchpoint, Inc. prior to the actual
installation to disseminate information to
existing customers about the AMR Technology.

A copy of a sample letter from the Mayor as
well as a copy of a Frequently Asked
Questions (FAQ) informational piece were
included with the report that was distributed to
each of you previously.
Questions??
64