AMI 2.0: The Next Phase of Grid Intelligence

**Marc Miller** (0:11)
Welcome to The ScottMadden Energy Exchange, conversations with leaders shaping the future of the energy industry. I'm your host, Marc Miller, partner and energy practice leader at ScottMadden. In this podcast, we explore the most important issues facing utilities and energy companies, from infrastructure and regulation to operations and strategy. We focus not just on what's changing, but on what it takes to execute in a complex and evolving environment.
Today's episode is titled AMI 2.0, the next phase of grid intelligence. Over the past decade, many utilities deployed advanced metering infrastructure, giving them new visibility into customer usage and grid operations. But technology and expectations have evolved very quickly, and a new generation of capabilities is emerging.
Utilities are now beginning to explore what many are calling AMI 2.0, systems that go beyond basic meter data collection to support more advanced grid operations, deeper customer insights, and potentially much more sophisticated use of analytics and artificial intelligence. To discuss what's driving this next phase of smart metering and what it means for utilities, I'm joined today by Kevin Hernandez, a partner and grid edge expert at Scott Madden, who works closely with organizations on grid modernization and advanced metering initiatives. Kevin, welcome to The Scott Madden Energy Exchange. For listeners who may not live in this world every day, let's start simple. What exactly do we mean when we talk about AMI 2.0?

**Kevin Hernandez** (1:53)
Thanks, Marc. I think that's a really good place to start. To be clear, there's really no single definition for what AMI 2 is versus AMI 1.0.
But generally speaking, we're talking about the next generation of advanced meters that have more and really a different set of capabilities than the first generation of smart meters. They go way beyond just more granular metering intervals, such as hourly to 50-minute to things like on-meter computing, apps that are running on the meters, and what I think is really interesting, this connection to customers. A lot of distributed intelligence functions, and a lot of just new capabilities in general.

**Marc Miller** (2:36)
Why is this conversation picking up momentum right now? What's changed that's bringing AMI back into focus?

**Kevin Hernandez** (2:44)
Yeah, a few things. The first thing is that those early generations of AMI, the first generation of smart meters, those were deployed in kind of the early 2010, 2010, 2009 time frame, and a lot of those are just simply nearing end of life. So the meters themselves are beginning to age out.
So for the utilities that were early adopters and that had those initial meters on their systems, they're beginning to look at what replacements are those going to be. So are they going to be replacing those with something similar, maybe new models of something similar with similar capabilities? Or are they going to be looking ahead and exploring some of these new, some of this next generation? And I think kind of coupled with that is this push that we're seeing throughout the industry, this push towards a more data-driven grid that is really kind of pulling together and using data in a much different way than we were even just five or 10 years ago. So things like DER, management and DERMs, smart devices, we really have a much more dynamic system. And so I think a lot of utilities are now looking and seeing how we move from this MI 1 world and use the next generation of meters to fit into their overall kind of digitalization and what's really becoming a data-centric grid management model.

**Marc Miller** (4:11)
To understand where the industry is headed, it's probably helpful to take a step back and look at where utilities are today broadly in their AMI journey. Kevin, how would you describe the current landscape of AMI adoption across utilities in the US?

**Kevin Hernandez** (4:31)
Yeah, sure. So it's pretty interesting. When we look at the data, we see that the rollout of advance meters really began in like I said before, that kind of 2007, 2010 timeframe, the early 2010s.
And at the time, AMI penetration was really quite small. It was less than 5 percent in the US. But by the time we get to 2022, we're looking at penetration of over 77 percent. And the biggest jump in that happened between 2009 and 2011 So we saw this real spike in adoption driven by a couple of states. And I think that that's an important distinction to make because AMI adoption really hasn't been very even. It's been very uneven across the US. In fact, in some places like Texas and California, good examples, we see meter adoption rates are well above 80 percent for residential and commercial customers. But in other places, AMI has really lagged. New England, for instance, is notorious for low adoption rates and penetration there, even today, is in some places in the high 20s, low 30s range, so percent range.