SCE-02 Vol. 1 Part 3 Meter Activities · Meter Activities3 (Total Company 2018 $ Millions) 1 C. O&M...

Application No.: A.19-08- Exhibit No.: SCE-02, Vol. 1, Part 3 Witnesses: D. Bernaudo

(U 338-E)

2021 General Rate Case

Meter Activities

Before the

Public Utilities Commission of the State of California

Rosemead, California August 30, 2019

SCE-02, Vol. 1, Part 3: Meter Activities

Table Of Contents Section Page Witness

-i-

I. INTRODUCTION .............................................................................................1 D. Bernaudo

A. Content and Organization of Meter Activities Testimony .....................1

B. Summary of O&M and Capital Request ................................................1

II. METER ACTIVITIES .......................................................................................4

A. Overview ................................................................................................4

B. 2018 Decision ........................................................................................5

1. Comparison of Authorized 2018 to Recorded ...........................5

C. O&M Forecast – Meter Activities .........................................................7

1. Meter Engineering, Field Meter Maintenance, & Field Meter Testing ....................................................................8

a) Work Description and Need...........................................8

b) Scope and Forecast Analysis .......................................10

(1) Historical Variance Analysis ...........................11

(2) Forecast ............................................................12

2. Field Meter Reading ................................................................12

a) Work Description and Need.........................................12



(2) Forecast ............................................................14

3. Installations, Removals and Relocations .................................14




(2) Forecast ............................................................16

SCE-02, Vol. 1, Part 3: Meter Activities

Table Of Contents Section Page Witness

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4. Customer Installation & Energy Theft .....................................16


(1) Customer Installation .......................................16

(2) Energy Theft ....................................................16



(2) Forecast ............................................................18

5. Meter System Maintenance Design .........................................19




(2) Forecast ............................................................21

D. Capital Expenditures - Meter Activities ..............................................21

1. Meter Engineering ...................................................................21

a) Program Description & Need .......................................22

(1) Routine Meter Work ........................................23

(2) Non-Routine Meter-Related Projects ...............23

b) Basis for Capital Expenditure Forecast ........................25

(1) Routine Meter Work ........................................25

(2) Non-Routine Meter-Related Projects ...............26

2. Meter System Maintenance Design .........................................26

a) Program Description and Need ....................................27

b) Basis for Capital Expenditure Forecast ........................28

1

I. 1

INTRODUCTION 2

A. Content and Organization of Meter Activities Testimony 3

This testimony includes analyses for the Meter Activities Business Planning Element (BPE) of: 4

(1) O&M and capital funding authorized in the 2018 General Rate Case (GRC) compared to recorded 5

amounts in 2018; (2) the 2021 O&M test year forecast; and (3) the 2019 – 2023 capital expenditures 6

forecast. 7

B. Summary of O&M and Capital Request 8

SCE forecasts $37.541 million in O&M expenses in test year 2021 to manage work under Meter 9

Activities. This includes $15.466 million for Meter Engineering, Field Meter Maintenance, and Field 10

Meter Testing; $6.111 million for Field Meter Reading; $7.978 million for Meter Installations, 11

Removals and Relocations; $4.555 million for Customer Installation & Energy Theft; and $3.431 12

million for Meter System Maintenance Design. 13

SCE forecasts $31.848 million in capital expenditures in test year 2021 for Meter Activities. This 14

includes $30.948 million for Meter Engineering and $0.900 million for Meter System Maintenance 15

Design. 16

SCE’s total request for the Distribution Grid Business Planning Group (BPG) is presented in 17

Figure I-1 and Figure I-2 below. 18

2

Figure I-1 Distribution Grid Part 3 O&M Expenses 2021 Forecast

(Total Company Constant 2018 $Million)

3

Figure I-2 Distribution Grid Part 3 Capital Expenditures 2019-2023

(Total Company-Nominal $Million)

4

II. 1

METER ACTIVITIES 2

A. Overview 3

The Meter Activities BPE includes the activities associated with the life span of a customer’s 4

meter. The O&M activities include (1) Meter Engineering, Field Meter Maintenance, & Field Meter 5

Testing; (2) Field Meter Reading; (3) Installations, Removals and Relocations; (4) Customer Installation 6

& Energy Theft; and (5) Meter System Maintenance Design. The capital activities include (1) Meter 7

Engineering and (2) Meter System Maintenance Design. The work done in these activities is required for 8

the safety and reliability of the meter system, guards against the issues caused by technology 9

obsolescence, allows customers to receive timely billing, makes sure that all customers pay their fair 10

share for the electricity they use, and protects against the safety issues caused by energy theft. The O&M 11

activities requested in this chapter are shown in Table II-1 and the capital activities requested in this 12

chapter are shown in Table II-2. 13

Table II-1 Meter Activities O&M Activities

Recorded (2014-2018) / Forecast (2019-2021) (Constant 2018 $000)

TOTAL CONSTANT AMOUNT2014 2015 2016 2017 2018 2019 2020 2021

Customer Installation and Energy Theft $7,293 $6,059 $5,803 $4,489 $4,555 $4,555 $4,555 $4,555Field Meter Reading $15,498 $14,555 $12,857 $9,997 $6,111 $6,111 $6,111 $6,111Installations, Removals and Relocations $10,320 $10,841 $9,635 $8,995 $7,978 $7,978 $7,978 $7,978Meter Engineering, Field Meter Maintenance, and Field Meter Testing $19,118 $16,696 $18,020 $17,874 $15,466 $15,466 $15,466 $15,466Meter System Maintenance Design $2,491 $2,174 $2,396 $2,367 $2,760 $3,430 $3,431 $3,431Totals $54,720 $50,325 $48,712 $43,722 $36,870 $37,540 $37,540 $37,541

Recorded Forecast

5

Table II-2 Meter Activities Capital Activities

Recorded (2014-2018) / Forecast (2019-2023) (Nominal $000)

B. 2018 Decision 1

1. Comparison of Authorized 2018 to Recorded 2

The 2018 GRC Decision requires SCE to compare the 2018 authorized amounts to the 3

recorded amounts.1 The 2018 final decision authorized $49.5 million for Meter Activities O&M. This 4

compares to $36.9 million total recorded for 2018, which is $12.6 million lower than authorized. The 5

lower recorded amount is primarily due to changes to accounting as a result of the organizational move 6

of Meter Activities from Customer Service to T&D in August 2016 and operational improvements to 7

reduce O&M costs. 8

1 D.19-05-020, Ordering Paragraph 22, pp. 441-442.

TOTAL CONSTANT AMOUNT2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Meter Engineering $11,468 $13,581 $13,389 $20,922 $13,056 $27,327 $44,242 $30,948 $29,938 $25,261Meter System Maintenance Design $177 $435 $437 $368 $228 $850 $900 $900 $900 $900Totals $11,645 $14,017 $13,827 $21,290 $13,284 $28,177 $45,142 $31,848 $30,838 $26,161

Recorded Forecast

6

Figure II-3 2018 GRC Requested and Authorized O&M Expenses Compared to Recorded for Meter

Activities2 (Total Company 2018 $ Millions)

The 2018 final decision also authorized $33.5 million for Meter Activities capital 1

expenditures. This compares to $13.3 million total recorded for 2018, which is $20.2 million lower than 2

authorized. This lower recorded amount is due to lack of availability of new meter technology required 3

to move our system from obsolete 2G technology to keep our existing Edison SmartConnect (ESC) 4

system operating. 5

2 Refer to WP SCE-07, Vol. 01 - O&M Authorized to Request Workpaper.

7

Figure II-4 2018 GRC Requested and Authorized Capital Expenditures Compared to Recorded for

Meter Activities3 (Total Company 2018 $ Millions)

C. O&M Forecast – Meter Activities 1

The recorded historical and forecast O&M expenses for all Meter Activities are shown below in 2

Table II-3 and discussed in the following sections. 3

3 Refer to WP SCE-07, Vol. 01 - Capital Authorized to Request Workpaper.

$37.5

$33.5

$13.3

0

5

10

15

20

25

30

35

40

2018 Request 2018 Authorized Meter Engineering Meter System MaintenanceDesign

2018 Recorded

Meter Engineering Meter System Maintenance Design

($19.6) ($0.7)

8

Table II-3 Meter Activities

Recorded 2014-2018/Forecast 2019 -2021 (Total Company - Constant 2018 $000)

1. Meter Engineering, Field Meter Maintenance, & Field Meter Testing 1

a) Work Description and Need 2

The Meter Engineering, Field Meter Maintenance, & Field Meter Testing activity 3

includes SCE’s Meter Engineering, Meter Shop, Field Meter Maintenance, and Field Meter Testing 4

operations. 5

Meter Engineering manages metering strategy, meter technical specification and 6

selection, routine meter deployment support, and the reliability and quality of all metering products used 7

on the SCE system. Engineering activities are primarily driven by customer population growth, 8

customer metering load requirements, meter failure and communication issues, introduction of new 9

meter technology, and customer participation in time-of-use programs. Specially trained meter 10

technicians perform complex metering jobs, which are jobs that require additional equipment or special 11

installation or maintenance instructions. This work is normally performed for large commercial 12

customers, although residential customers who have solar panels are an increasing share of complex 13

2014 2015 2016 2017 2018 2019 2020 2021Labor $39,161 $35,761 $33,749 $32,866 $28,694 $28,781 $28,781 $28,782

Non-Labor $15,559 $14,564 $14,963 $10,856 $6,029 $5,953 $5,953 $5,953Other $2,147 $2,806 $2,806 $2,806

Total Expenses $54,720 $50,325 $48,712 $43,722 $36,870 $37,540 $37,540 $37,541

Ratio of Labor to Total 72% 71% 69% 75% 78% 77% 77% 77%

Recorded Forecast

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

2014 2015 2016 2017 2018 2019 2020 2021

Labor Non-Labor Other

9

metering work. In addition, SCE’s metering engineers work with manufacturers to evaluate new 1

metering products to meet SCE customer needs. This group also analyzes trouble reports generated by 2

SCE’s Reliability Operations Center and Advanced Metering Operations group4 to determine the root 3

cause of an issue, identify equipment needed for replacement, and provide replacement information to 4

field meter technicians who perform the replacement. 5

The Meter Shop tests meters received from suppliers and manages the warranties 6

and maintenance on meters returned by SCE field service personnel. Meter Shop personnel also conduct 7

root cause analysis of field meter failures to maintain the safety, reliability, and data integrity of the 8

meters in the field. The Meter Shop also works with manufacturers on meter product issues, including 9

quality and functionality improvements. 10

Field Meter Maintenance and Field Meter Testing are activities performed to 11

verify installations are completed properly by confirming the service voltage and wiring are correct. 12

These activities are performed by meter technicians in SCE’s Electrical Metering Services (EMS). 13

Appropriate measurements and inspections confirm the service is being metered correctly, which is 14

necessary for accurate billing. Meter technicians also perform non-test work to the meter and panel, 15

including service wiring, interval read verifications, installation of relay equipment, communication 16

checks, and site assessments to determine if radio coverage is available prior to installing radio 17

communication meters. EMS supports SCE’s metering systems by administering required meter test and 18

maintenance programs. EMS also installs meters and associated metering equipment for complex 19

metering installations. The greatest volume of work arises from meter-accuracy testing. 20

Meter-accuracy testing includes sample and routine tests, request tests, and 21

installation tests. SCE’s sample and routine test function consists of four testing programs: (1) annual 22

testing of meters with annual usage of two million kWh or more; (2) biennial testing of meters with 23

annual usage between 720,000 kWh and two million kWh; (3) random sample testing of non-residential 24

meters with annual usage less than 720,000 kWh; and (4) random sample testing of residential meters. 25

Request tests come from customers, field personnel, and billing representatives. Customers may 26

question the accuracy of their meter and request a test. A meter test may also be requested by the 27

4 Prior to 2018, the SmartConnect Operations Center (SOC) resided in Field Meter Reading. Due to changes in

business needs, the SOC was reorganized into two groups in 2018: the Reliability Operations Center (ROC) and the Advanced Metering Operations group (AMO). AMO still resides in the Meter System Maintenance Design work activity described in II.C.5.

10

Commission, generally in response to a billing inquiry. Finally, field personnel can observe conditions 1

in the field, such as meter damage, which require a meter test to determine if the meter is registering 2

usage accurately or if it needs repair. When meter accuracy is found to be outside of established 3

tolerance limits, billing representatives are provided with test results, which they use to calculate and 4

issue bill corrections if necessary. Installation tests consist of meter installation tests in the field for new 5

services to facilitate safe and accurate installation and for all complex metering services following meter 6

replacement. Field installation tests are necessary to identify potential service wiring problem conditions 7

or meter programming errors that could result in unsafe conditions or inaccurate billing. 8

b) Scope and Forecast Analysis 9

The recorded historical and forecast O&M expenses for Meter Engineering, Field 10

Meter Maintenance, and Field Meter Testing are shown in Figure II-5. 11

11

Figure II-55 Meter Engineering, Field Meter Maintenance, & Field Meter Testing

Recorded 2014-2018/Forecast 2019-2021 (Total Company - Constant 2018 $000)

(1) Historical Variance Analysis 1

The historical variance is due largely to meters exiting their warranty 2

period. Most SCE meters have recently aged beyond their warranty period, thus causing a decrease in 3

O&M labor over the last five years. Meters have five-year warranties, and meters that need to be 4

replaced within the warranty period are refurbished or replaced by the manufacturer. All labor for testing 5

and maintenance of those meters is charged to O&M. As the warranties expire (which has been the case 6

for most SCE meters over the last five years), faulty meters are replaced with new meters. All labor 7

associated with new meters, including new meter testing in the Meter Shop, the first time a new meter is 8

tested in the field, and the removal of a meter to be salvaged, is capital expenditures. 9

5 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 3 - 9 – O&M Detail for Meter Engineering, Field Meter

Maintenance, & Field Meter Testing.

2014 2015 2016 2017 2018 2019 2020 2021Labor $15,501 $13,725 $14,613 $14,972 $12,984 $12,984 $12,984 $12,984

Non-Labor $3,617 $2,971 $3,406 $2,902 $2,482 $2,482 $2,482 $2,482Other

Total Expenses $19,118 $16,696 $18,020 $17,874 $15,466 $15,466 $15,466 $15,466


Recorded Forecast

$5,000

$10,000

$15,000

$20,000

$25,000

2014 2015 2016 2017 2018 2019 2020 2021


12

The increase in 2017 labor costs was caused by the replacement of cellular 1

relay batteries. The batteries of cellular relays last approximately seven years. In 2017, SCE replaced all 2

of those batteries to make sure that the cellular relays would continue to function until their replacement 3

by the 4G-enabled relays discussed in the II.D.1 Meter Engineering capital activity. Warranty 4

expirations and the completion of the battery replacements resulted in the decrease in labor costs from 5

2017 to 2018. 6

Non-Labor costs fluctuated over the historical period due to a variety of 7

factors. In 2014, SCE employed consultants to help stabilize the Edison SmartConnect® (ESC) system6 8

and improve the company’s processes and procedures around the system. In 2015, non-labor decreased 9

because we no longer needed the services of the consultants. In 2016, we purchased Automated External 10

Defibrillators (AEDs) for each employee vehicle. 11

(2) Forecast 12

SCE forecasts the work for this activity to continue at the 2018 level and 13

thus used the last year recorded costs for labor and non-labor in 2018 as the basis for the 2021 test year 14

forecast. SCE plans to continue performing the activities described in Meter Engineering, Field Meter 15

Maintenance, & Field Meter Testing at the current levels. Last year recorded will provide SCE with the 16

funding necessary to continue to perform the work needed to ensure our meters are installed safely and 17

accurately, and to maintain the reliability and quality of the metering system. 18

2. Field Meter Reading 19


This activity includes Manual Meter Reading and Real-Time Energy Metering. At 21

the end of 2018, over 99 percent of SCE’s meters were being read automatically—these costs are not 22

included in this activity. SCE manually reads meters that are located in areas where connectivity to the 23

ESC communications system is difficult or impractical. SCE also manually reads meters for customers 24

that elected service under SCE’s SmartConnect Opt-Out tariff (Schedule ESC-OO). Manual meter 25

reading and data collection is performed by SCE’s Field Service Representatives (FSRs). 26

Real-Time Energy Meters (RTEM) are deployed on the SCE system for large 27

commercial and industrial accounts. Fifteen-minute interval-usage data is automatically collected and 28

6 ESC is the system built around the advanced metering infrastructure. It is based on the use of advanced ESC

meters, which allow the company to read meters automatically rather than sending out Meter Readers.

13

stored daily, and day-after usage data is provided to these customers through the internet. Unlike ESC 1

meters, which process data through the Meter Data Management System7 (MDMS), RTEM-metered 2

usage data is processed daily through SCE’s Customer Data Acquisition System (CDAS), which applies 3

data validations and routes usage data to the billing system to prepare monthly bills. 4


The recorded historical and forecast O&M expenses for Field Meter Reading are 6

shown in Figure II-6. 7

Figure II-68 Field Meter Reading



Labor has decreased from 2014 to 2018. As a result of the operations 9

around the system stabilizing in 2015 and 2016, labor decreased from the 2014 level. The decrease in 10

7 The Meter Data Management System retrieves, stores, and calculates meter usage data to support customer

billing.

8 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 10 - 16 – O&M Detail for Field Meter Reading.

2014 2015 2016 2017 2018 2019 2020 2021Labor $11,308 $10,814 $9,239 $8,870 $6,079 $6,079 $6,079 $6,079

Non-Labor $4,191 $3,741 $3,618 $1,128 $32 $32 $32 $32Other

Total Expenses $15,498 $14,555 $12,857 $9,997 $6,111 $6,111 $6,111 $6,111


Recorded Forecast

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

2014 2015 2016 2017 2018 2019 2020 2021


14

labor from 2017 to 2018 was due to both a change in accounting resulting from Field Meter Reading’s 1

move from Customer Service to T&D and the SOC work moving into the ROC and AMO, first 2

described in footnote 4, and further described in II.C.5. 3

With regard to non-labor, the company hired consultants to assist with the 4

technology roadmap study, which helped identify the metering technology for SCE to deploy to avoid 5

any issues associated with obsolescence. The consultants were kept on until the study was completed in 6

2016. At that point, the consultants were no longer needed, leading to a non-labor reduction in 2017. 7

During 2017, we began recording customer payments for installation of generation meter adapters 8

(GMA)9 in non-labor, resulting in a decrease in non-labor in 2017. In 2018 there was a further decrease 9

as we recorded a full year of GMA payments. Installation costs for generation meter adapters are funded 10

by the customer and the payment received from the customer is recorded to non-labor in this activity. 11

(2) Forecast 12

The last year recorded is the appropriate basis for forecasting the Test 13

Year labor and non-labor O&M for future Field Meter Reading expenses because SCE forecasts this 14

necessary work to continue at the 2018 level. SCE plans to continue performing the activities described 15

in Field Meter Reading at the current levels because it does not foresee any changes to the volume or 16

type of work over the test year period. Last year recorded will provide SCE with the funding necessary 17

to continue to perform the field meter reading activity. Additionally, the use of 2018 includes a full year 18

of GMA payments, which will continue. 19

3. Installations, Removals and Relocations 20


This activity includes the work done for the installation, replacement, and 22

relocation of customer meters. Installation, replacement, and relocation work includes setting meters for 23

new customers, relocating meters at customers’ requests, and replacing broken meters. Both SCE and 24

contractor crews perform the work depending on each service center’s volume of meter-related work. 25

Labor costs associated with this work category include SCE crew and field personnel labor for 26

installing, removing, and relocating meters. Non-Labor costs include contractor costs, transportation, 27

and other allocated charges. 28

9 A Generation Meter Adapter is a device that is placed in a meter socket that allows customers to interconnect

generation (such as from a rooftop solar array) to the supply side of the main breaker without modifying the panel.

15


The recorded historical and forecast O&M expenses for Meter Installations, 2

Removals and Relocations are shown in Figure II-7. 3

Figure II-710 Meter Installations, Removals and Relocations



As discussed in II.C.1.b)(1), most SCE meters have phased out of their 5

warranty period, thus causing a decrease in O&M labor over the last five years. Meters typically have 6

five-year warranties, and meters that need to be replaced within the warranty period are refurbished or 7

replaced by the manufacturer. As the warranties expire, failed meters are replaced with new meters. 8

Labor for installing a refurbished meter is charged to O&M. Labor for first-time installation of new 9

meters is charged to capital. 10

10 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 17 - 23 – O&M Detail for Installations, Removals and Relocations.

2014 2015 2016 2017 2018 2019 2020 2021

Labor $6,882 $6,881 $5,846 $4,865 $4,892 $4,892 $4,892 $4,892Non-Labor $3,438 $3,961 $3,789 $4,131 $3,086 $3,086 $3,086 $3,086

OtherTotal Expenses $10,320 $10,841 $9,635 $8,995 $7,978 $7,978 $7,978 $7,978


Recorded Forecast

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

2014 2015 2016 2017 2018 2019 2020 2021


16

The non-labor variance was primarily driven by a payment that was 1

charged to this account in 2014 and subsequently reversed in 2017. 2

(2) Forecast 3

The last year recorded is the appropriate basis for forecasting the test year 4

labor and non-labor O&M for future Installations, Removals and Relocations expenses because SCE 5

forecasts this necessary work to continue at the 2018 level. SCE plans to continue performing the 6

activities described in Installations, Removals and Relocations at the current levels because SCE expects 7

to see the same volume of work over the test year period. Last year recorded will provide SCE with the 8

funding necessary to continue to install, remove, and relocate customer meters. 9

4. Customer Installation & Energy Theft 10


This activity includes the work done for meter installations driven by customer 12

requests and the work done to identify and rectify energy theft. 13

(1) Customer Installation 14

The Customer Installation activity is different from both the Move-Ins 15

activity described in SCE-03, V.01 and the Installations described in section 3.a). Customer Installation 16

includes work to respond to requests or problems customers have with their billing or electrical service. 17

This includes billing inquiries, complaints about noisy meters, removal of lock rings for remodels, and 18

reports of damaged meters. In addition to customer-initiated orders and orders initiated by SCE’s 19

Customer Service organization, automated exception review processing programs in the MDMS 20

generate electronic orders to the field requiring meter inspections and meter pick-up reads. These are 21

generally complex issues that require the involvement of field personnel and equipment. 22

(2) Energy Theft 23

This activity includes work required to collect revenues lost through 24

energy theft or billing exceptions caused by irregularities in meter registration. This revenue-assurance 25

function identifies customers who potentially benefit from energy usage at the expense of other 26

customers, identifies and corrects situations in which a customer has been billed incorrectly, collects the 27

revenue for unauthorized usage, and addresses potential safety issues caused by these situations. 28

Since completing ESC meter deployment in 2012, SCE does not visually 29

inspect all its metering installations on a monthly basis, as occurred when meters were manually read. 30

As a result, SCE’s Energy Theft program is leveraging smart meter technology (alarms, flags, 31

17

exceptions) and using the annual survey program to identify energy theft and public safety conditions. 1

These are explained further below. 2

(a) Smart Meter Technology 3

SCE uses machine learning on ESC meter data to detect various 4

unauthorized intrusions into the metering system and communicate tamper flags that initiate a field 5

investigation. In addition, the program uses billing exception data in conjunction with tamper events to 6

generate field investigation orders. 7

(b) Annual Survey Program 8

The Commission has mandated an annual survey of 0.5 percent of 9

installed ESC meters in order to mitigate the absence of meter readers, who were trained to identify 10

potential meter irregularities as part of the monthly manual meter reading process.11 The annual survey 11

allows SCE to physically look for signs of energy theft in a random sample of the meter population. 12


The recorded and forecast O&M expenses for Customer Installation and Energy 14

Theft are shown in Figure II-8. 15

11 ESC Phase III deployment Decision D.08-09-039, Section 8, p. 17, and Section 10.1.2, p. 35.

18

Figure II-812 Customer Installation & Energy Theft



From 2014 to 2016, labor expenses decreased as the ESC system 2

stabilized. The ESC system capabilities improved SCE’s ability to access accurate and timely meter 3

data, resulting in a decrease in pick-up reads and exception orders. 4

In 2017, non-labor costs reduced significantly as SCE centralized and 5

consolidated various cellular telephone costs. These costs are now recording in SCE’s Information 6

Technology organization. 7

(2) Forecast 8

The last year recorded is the appropriate basis for forecasting the test year 9

labor and non-labor O&M for future Customer Installation & Energy Theft expenses because SCE 10

forecasts this necessary work to continue at the 2018 level. SCE plans to continue performing the 11

12 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 24 – 30 – O&M Detail for Customer Installation & Energy Theft.

2014 2015 2016 2017 2018 2019 2020 2021

Labor $5,457 $4,331 $4,039 $4,149 $4,211 $4,211 $4,211 $4,211Non-Labor $1,836 $1,728 $1,764 $340 $344 $344 $344 $344

OtherTotal Expenses $7,293 $6,059 $5,803 $4,489 $4,555 $4,555 $4,555 $4,555


Recorded Forecast

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

2014 2015 2016 2017 2018 2019 2020 2021


19

activities described in Customer Installation & Energy Theft at the current levels because SCE expects 1

to see the same volume of this work over the test year period. Last year recorded will provide SCE with 2

the funding necessary to continue to respond to customer requests related to their billing or electrical 3

service and to collect revenues lost through energy theft or billing exceptions caused by irregularities in 4

meter registration. 5

5. Meter System Maintenance Design 6


As described in II.C.2.a), SCE now reads over 99 percent of its meters through 8

wireless communications using advanced meters. Advanced meters communicate customer consumption 9

data using a wireless mesh network, which uses cellular frequencies. Advanced Metering Operations 10

(AMO) analyzes meter and communication data to identify failed devices, issue repair orders, optimize 11

communication performance, update firmware, and mitigate system problems. These monitoring 12

activities help ensure customer usage data is accurate and processed for use by other SCE operational 13

units. 14


The recorded historical and forecast O&M expenses for Meter System 16

Maintenance Design are shown below in Figure II-9. 17

20

Figure II-913 Meter System Maintenance Design



The labor increase of $517,000 from 2017 to 2018 is a result of a 2

reorganization in 2018 that split the SOC between the ROC and IT as first described in the Meter 3

Engineering, Field Meter Maintenance, & Field Meter Testing section above. This activity now includes 4

only the IT portion, with costs for the ROC included in the forecasts within SCE-02, V.01 Pt. 2. The 5

historical labor data shown above from 2014 to 2017 does not include the personnel who moved to IT; 6

those historical charges are shown in Field Meter Reading. After the reorganization, those personnel 7

began charging to Meter System Maintenance Design, and the 2018 recorded labor amount reflects that 8

change. 9

Non-Labor costs, which are the costs to lease the cellular bandwidth 10

required for meter data transmission (similar to cell phone bills), remained relatively stable from 2014 to 11

2017. In 2018, we are presenting those costs in Other as a result of changes due to the reorganization. 12

13 Refer to WP SCE-02, Vol. 01, Pt.3, pp. 31 - 37 – O&M Detail for Meter System Maintenance Design.

2014 2015 2016 2017 2018 2019 2020 2021Labor $13 $10 $10 $11 $528 $615 $616 $616

Non-Labor $2,477 $2,163 $2,386 $2,356 $85 $9 $9 $9Other $2,147 $2,806 $2,806 $2,806

Total Expenses $2,491 $2,174 $2,396 $2,367 $2,760 $3,430 $3,431 $3,431


Recorded Forecast

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

2014 2015 2016 2017 2018 2019 2020 2021


21

(2) Forecast 1

The labor forecast is based on last year recorded as a base estimate. Using 2

last year recorded costs to develop the forecast is an appropriate method because last year recorded 3

operations are expected to be similar to test year operations within this activity. Labor is forecast to 4

increase $87,000 because 2018 does not reflect a full year of staffing at the current level. 5

The Other forecast, which is made up of wireless communication services 6

transmitted over cellular frequency, is also based on last year recorded as a base estimate. SCE will 7

require a $659,000 increase due to the additional cellular bandwidth necessary to support the Cell Relay 8

Replacement program described in II.D.1.a)(2)(a). 9

D. Capital Expenditures - Meter Activities 10

SCE forecasts $162.167 million in capital expenditures for 2019 - 2023 for Meter Activities. 11

This includes $157.717 million for Meter Engineering and $4.450 million for Meter System 12

Maintenance Design. 13

1. Meter Engineering 14

The recorded and forecast capital expenditures for Meter Engineering are shown in 15

Figure II-10. 16

22

Figure II-1014 Meter Engineering Capital Expenditure Summary

Multiple WBS Elements15 Recorded 2014-2018/Forecast 2019-2023

(Total Company – Nominal $000)

a) Program Description & Need 1

This program includes the meters needed to meet forecast customer growth, 2

replace defective or damaged meters outside of their warranty period, and address meter technology 3

changes for all of SCE’s residential, commercial, industrial, and agricultural customers. Metering Field 4

Operations develops the meter volume forecasts for meters such as the ESC meters, the RTEM meters, 5

and the legacy non-communicating electromechanical meters. The following sections describe the 6

different types of meters and describe how meter volume estimates were developed. The main drivers of 7

work are comprised of the following activities: (1) Routine Meter Work and (2) Non-Routine Meter-8

Related Projects. 9

14 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 38 - 41 – Capital Detail by WBS Element for Meter Engineering.

15 Meter Engineering capital expenditures include the following CWBS elements: CET-ET-MS-SE, CCS-00-CM-CO, CET-OT-OT-SC, CET-PD-OT-SC.

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Nominal $11,468 $13,581 $13,389 $20,922 $13,056 $27,327 $44,242 $30,948 $29,938 $25,261

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

Forecast

23

(1) Routine Meter Work 1

This section describes the activities for new customer growth meters and 2

replacement meters for residential, commercial, industrial, and agricultural customers. 3

(a) Growth Meters 4

The ESC meter is the standard meter that is used to serve new 5

customers with demands under 200 kW. The only exception is for those customers who opt out of ESC 6

metering. For those customers, SCE will provide legacy electromechanical non-communicating meters. 7

(b) Replacement Meters 8

Replacement meters are used to replace damaged meters for 9

customers with demands under 200 kW. Like the new customer growth meters, the only exception to the 10

ESC meter is for customers who have opted out of ESC metering. In these instances, SCE will provide a 11

legacy electromechanical non-communicating meter as the replacement meter. 12

(c) RTEM Replacement 13

SCE’s largest customers with demands in excess of 200 kW 14

typically require more complex metering systems that are beyond the scope and capability of the ESC 15

program. RTEM meters are interval data recorder (IDR) meters that are needed to accommodate the 16

most complex rates and billing options. SCE uses RTEM replacement meters to replace or install RTEM 17

meters for customers with demands greater than 200 kW. 18

(2) Non-Routine Meter-Related Projects 19

(a) Cell Relay Replacement 20

SCE is replacing cell relays due to obsolescence and point-to-point 21

meters to improve the use of its over-the-air-metering-system. Cell relays work in conjunction with 22

smart meters to collect interval data from customer meters and relay that data back to the Network 23

Management System (NMS). One cell relay device can transmit data for up to 500 smart meters. Factors 24

impacting the product lifecycle of a cell relay include the availability of product support by the cell relay 25

vendor and the risk of technological obsolescence. 26

Under SCE’s support agreement with its cell relay vendor, the 27

vendor must provide support so long as the product is not at its “end-of-life” date (e.g., when the vendor 28

announces the product is discontinued due to market demand, shifts in technology, or a change in focus 29

and investment) and SCE is “technically current” (i.e., not more than two system updates behind the 30

current product release). To mitigate these risks, SCE is replacing cell relays at or near the end of each 31

24

cell relay’s seven-year product lifecycle. SCE is working with vendors to transition these obsolete cell 1

relays to the next generation of communication devices. 2

Point-to-Point Meters (PTPs) are meters that communicate to 3

SCE’s back-office system using cellular communication. The use of PTPs will help strengthen SCE’s 4

over-the-air metering system by increasing the amount of direct points to our back-office system. This 5

will help address communication challenges in remote areas with only a few meters, where the cost of a 6

cell relay is not justified. PTPs could help SCE pinpoint outages faster, thereby improving public safety 7

and decreasing outage durations. 8

(b) Infrastructure Replacement Program – RTEM meters 9

SCE’s largest customers with demands in excess of 200 kW 10

typically require more complex metering systems that are beyond the scope of the ESC program. Non-11

routine work includes our meter infrastructure replacement program of 17,000 obsolete RTEM meters 12

that use radio technology. Existing radio technology is expected to become obsolete and no longer 13

supported by the end of 2023. 14

(c) Catalina Meter Replacement Program 15

The Catalina Meter Replacement program will convert legacy 16

electromechanical meters to over-the-air meters. This program is forecast to begin in the fourth quarter 17

of 2020 and to be completed by year end 2021. This program will replace the 2,600 legacy 18

electromechanical meters on Catalina Island with over-the-air meters. 19

The over-the-air meters will help address safety risks, remove the 20

need for employees to deal with remote island conditions to read the meters, and provide time-of-use 21

capabilities. Employees who currently have to read meters that are located in rugged terrain or in hard-22

to-access locations face a safety risk, and reading the meters over the air will remove that risk. Further, 23

over-the-air meters would provide Catalina customers access to time-of-use rates and remote service 24

switch for remote connect and disconnect capabilities. 25

(d) Complex Meter Replacement Program 26

SCE has identified the need to replace nearly 5,000 complex 27

meters that are currently deployed throughout our territory on 480 volt commercial accounts and have 28

been identified as a safety risk to SCE employees and customer-owned property. SCE has already begun 29

replacing some of these meters with legacy meters but will require an alternate solution due to its limited 30

inventory of those legacy meters. SCE is currently working with a vendor to develop a new complex 31

25

meter that does not have the above-described safety risks in order to continue the replacement of these 1

meters. The new meter is scheduled to be approved by year-end 2019 and deployment is scheduled to 2

begin in 2020. 3

(e) Broadband Global Area Network Device Installation 4

A Broadband Global Area Network (BGAN) device provides 5

communication of customer billing, meter event, and performance data through a satellite signal in 6

remote areas where cellular communication service is unavailable. This allows the communication of 7

data for one or multiple meters in remote areas to SCE’s billing and data services systems. 8

b) Basis for Capital Expenditure Forecast 9

SCE developed its forecast for Meter Engineering by aggregating the individual 10

forecasts for (1) Routine Work and (2) Non-Routine Work. These individual cost forecasts are shown in 11

Table II-4 and discussed in more detail in the following sections. 12

Table II-4 Meter Engineering

Forecast 2019-2023 Nominal $000

(1) Routine Meter Work 13

The routine meter replacement forecast shown in Table II-4 is based on 14

the three-year average from 2016-2018.16 This three-year average captures growth and replacements, 15

which have been static over the past three years, as well as inventory management due to technology 16

obsolescence. 17

2014 and 2015 are not appropriate for inclusion in developing our forecast 18

because these years reflect costs SCE incurred when using many meters that were repaired by the vendor 19

under warranty. Now that most meters are no longer under warranty, costs for these years are not 20

representative of future needs. 21

16 2016 spend was $13.5 million, 2017 spend was $21.0 million, and 2018 spend was $13.1 million.

Line No. Description 2019 2020 2021 2022 20231 Routine Work 15,800$ 15,800$ 15,800$ 15,800$ 15,800$ 2 Non-Routine Work 11,527$ 28,442$ 15,148$ 14,138$ 9,461$ 3 Total 27,327$ 44,242$ 30,948$ 29,938$ 25,261$

Forecast (000)

26

(2) Non-Routine Meter-Related Projects 1

Table II-5 Non-Routine Work

Forecast 2019-2023 Nominal $000

Non-Routine Meter-Related Projects are based on forecast unit volumes 2

and unit costs. The forecast volumes of work and forecast costs (combined labor and material) are 3

provided in Table II-5. As mentioned above in a)(2), SCE has a need to maintain its SmartConnect 4

system by addressing the challenges created by the obsolescence of our existing metering system. To do 5

so, SCE must (1) replace cell relays, (2) replace RTEM meters, (3) roll out over-the-air meters in 6

Catalina, (4) replace complex meters, and (5) roll out BGAN devices. The cell relay replacement 7

program, described in II.D.1.a)(2)(a), is forecast to cost $53.46 million to buttress the current (ESC) 8

communications network with 15,000 cell relays and 29,400 Point-to-Point meters. Vendor inability to 9

provide a solution for replacement cell relays resulted in a delay in the replacement of these devices. The 10

cell relay replacement program is anticipated to span five years, beginning in 2019 and ending in 2023. 11

The RTEM replacement program, described in II.D.1.a)(2)(b). is forecast to cost $20.40 million to 12

replace 17,000 RTEMs that will be obsolete by the end of 2023. The program is anticipated to span three 13

years, beginning in 2021 and ending in 2023. The Catalina Meter Replacement Program, described in 14

II.D.1.a)(2)(c), is forecast to cost $1.40 million to replace 2,600 legacy electromechanical meters with 15

over-the-air meters. It is anticipated to span two years, beginning in 2020 and ending in 2021. The 16

Complex Meter Replacement Program, described in II.D.1.a)(2)(d), is forecast to cost $2.75 million to 17

replace 5,000 meters that have been identified as a safety risk to SCE employees and customer-owned 18

property. It is anticipated to begin and complete in 2020. As described in section II.D.1.a)(2)(e), SCE 19

forecasts the installation of 29 BGANs from 2019 to 2023, at a cost of $528,000. 20

2. Meter System Maintenance Design 21

Figure II-11 shows the historical and forecasted capital expenditure for Meter System 22

Maintenance Design. 23

Line No. Description Volume Cost (000) Volume Cost (000) Volume Cost (000) Volume Cost (000) Volume Cost (000)

1 Cell Relay Replacement Program 4,000 11,413$ 15,000 25,178$ 11,500 6,834$ 11,500 6,824$ 2,400 3,348$

2 RTEM Replacement Program - -$ - -$ 6,000 7,200$ 6,000 7,200$ 5,000 6,000$

3 Catalina Replacement Program - -$ 743 400$ 1,857 1,000$ - -$ - -$

4 Complex Meter Replacement Program - -$ 5,000 2,750$ - -$ - -$ - -$

5 ESC Communication Equipment 6 114$ 6 114$ 6 114$ 6 114$ 6 114$ 6 Total 4,006 11,527$ 20,749 28,442$ 19,363 15,148$ 17,506 14,138$ 7,406 9,461$

2019 2020 2021 2022 2023

27

Figure II-1117 Meter System Maintenance Design Capital Expenditure Summary

CIT-00-OP-NS-00001018 Recorded 2014-2018/Forecast 2019-2023

(Total Company – Nominal $000)

a) Program Description and Need 1

As discussed in Section II.D.1.a)(1)(c), SCE’s largest customers with demands in 2

excess of 200 kW typically require more complex metering systems that are beyond the scope of the 3

ESC program. Whereas the costs for RTEM meters themselves are captured in Section II.D.1.a)(1)(c), 4

this section includes the costs of the infrastructure that supports the network that those meters use. The 5

RTEM meters communicate using a network separate from the ESC program in order to meet the 6

requirements for customers with 200 kW of demand or greater. The program forecast supports the 7

networking, engineering, and infrastructure costs for new meter deployment and resolving network 8

performance issues. As new meters are added, the network designs change and are built out to ensure 9

17 Refer to WP SCE-02, Vol. 01, Pt. 3, pp. 42 - 43 – Capital Detail by WBS Element for Meter System

Maintenance Design.

18 Meter System Maintenance Design capital expenditures CWBS CIT-00-OP-NS-000010.

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Nominal $177 $435 $437 $368 $228 $850 $900 $900 $900 $900

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

Forecast

28

communication to the new meter locations. These changes include additional infrastructure, including 1

network repeaters, and additional take out points to meet latency and bandwidth requirements. Costs in 2

this area are projected to increase as the network is used to remediate additional locations where smart 3

connect meters will not work and to support the complex meter replacement program. 4

b) Basis for Capital Expenditure Forecast 5

The forecast is the estimated amount required to support the infrastructure for the 6

new meters being added to the network, refresh existing network infrastructure, and change network 7

designs as network assets deployed in the field reach end of life or fail. From 2019 to 2023, the estimate 8

is based on an annual forecast of 656 devices to be added to the network or that require additional 9

network infrastructure due to infrastructure failure or performance issues. Additionally, several existing 10

network packet router nodes are reaching end of life and require replacement to maintain 11

communication to the entire population of RTEM meters. This estimate also includes replacing 100 of 12

these nodes in 2019 and 125 nodes annually from 2020 to 2023. 13

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