Automation: The key to an efficient water industry?
Recent research has shown the importance of automation and analytics for the industry's future
Black & Veatch’s third annual Strategic Directions: U.S. Water report compiles data and insight from water utility leaders across the United States; survey responses were collected between 3 March and 4 April, 2014. Among the key issues identified in the report were ongoing concerns with ageing infrastructure, challenging financial conditions and the need for customer education.
Water smart grid programmes, such as advanced metering infrastructure (AMI), can support customer education programs. More than 60 percent of water utility leaders stated their organisation is considering or has implemented AMI to reduce costs. However, less than half are considering the use of web-based portals that use AMI data so that customers can better manage their water use and account.
The full report is available for download at no charge via www.bv.com/reports.
by Jeff Neemann, Smart Integrated Infrastructure Solution Lead, Black & Veatch
A water utility manager visited a power plant and was amazed at what he saw. A single person – the power plant manager – was operating the entire facility. The water utility manager asked how this could be achieved for his water/wastewater treatment facilities. The answer: advanced automation, technology and analytics. Recent research in the US has identified how implementation of new approaches in these areas can benefit water companies around the world.
Managing operational costs is one of the top five water industry issues, as identified in Black & Veatch’s Strategic Directions: US Water Industry report. Labour and energy represent the largest operational expenses for water utilities, both in the UK and US. In addition to the cost of labour, ageing workforces are an issue of rising prominence, ranking seventh among all respondents in the top industry issues list, and sixth among respondents that have both water and wastewater facilities.
Technology, coupled with the implementation of formal asset management frameworks - such as PAS 55 and more recently ISO 5500 - will enable utilities to capture the institutional knowledge of existing staff and reduce the need to replace retiring staff. In addition, well-planned asset management and technology programs will help utilities reduce energy consumption, improve maintenance programs and potentially improve cash flow and billing accuracy.
Energy Recovery and Efficiency
When it comes to reducing operational costs, improving energy efficiency has been the proverbial low-hanging fruit for water utilities. Nearly 80 percent of US water utilities have replaced some level of inefficient equipment, according to the report. In addition, more than 70 percent are using supervisory control and data acquisition (SCADA) analytics, and nearly 60 percent have conducted energy audits.
The Strategic Directions survey also indicates that a large portion of water utilities are interested in pursuing more advanced energy programmes, with 42 percent showing interest in developing energy master plans. Energy master plans will help define the next level of energy conservation measures that go beyond what has already been implemented. More than half of medium and large utilities are considering or have implemented software or data analytics programs to proactively manage energy costs as compared to 30 percent of small utilities.
Energy Performance Contracting
Many utilities remain challenged in developing and implementing enterprise-wide energy efficiency programmes. Less than 10 percent of all survey participants stated their utility plans to use energy performance contracting as a means for meeting energy efficiency goals.
For energy performance contracting, terms often include guaranteed levels of energy reduction, negating concerns over an uncertain return on investment. Because performance contracting involves a third-party service provider, utility staff can continue to focus on other higher priority issues.
Jeff Buxton, Executive Consultant, Black & Veatch made the following observation on this element of the research’s findings, “Energy performance contracting is an alternative financing mechanism that can enable water utilities to move forward with energy efficiency programmes. This method often requires minimal upfront capital costs, which helps address the challenge of budget constraints.”
Utilities that are financially sound with a strong business case for improvement prefer to self-implement an energy efficiency programme rather than share cost savings with a third party.
“But energy performance contracts can be a win-win situation for utilities looking to achieve meaningful reductions in their energy bills that do not have available capital or staff resources to implement necessary changes,” Buxton added.
The Water Smart Grid
US water utilities are strong believers in the immediate benefits of advanced metering systems. Nearly 75 percent of all respondents cited direct meter reading cost reductions as a primary driver for considering automatic meter reading (AMR) or advanced metering infrastructure (AMI) programmes, commonly referred to as smart metering. Nearly half of respondents cited leak detection as another benefit, which can reduce expenses associated with non-revenue water.
AMR is a system that enables utility meter reading via mobile or drive-by technology. AMI, on the other hand, refers to more advanced technology where meter data is transmitted over a two-way, fixed network to a central control center for processing.
Kevin Cornish, Operational Technologies Consulting Practice Lead, Black & Veatch observes: “We expect growth in AMI use across the industry because of the additional benefits these systems can provide beyond meter reading cost reductions. Benefits of AMI systems include the ability to remotely control network devices, such as smart meters, enhanced customer service and enhanced leak detection solutions.”
Projects that the technologies commonly referred to as the “Smart Water Grid” – such as smart meters or distribution sensors – will become an integral part of water utilities’ enterprise operations.
“Water utilities can achieve similar results as their electric utility peers who have realised increased system reliability, improved operating efficiency and enhanced customer service as a result of their AMI programs,” Cornish continues.
Using Cloud-Based Programmes
Water utilities can continue moving toward greater levels of automation. Furthermore, water utilities can benefit from cloud-based services that have altered the economics of advanced automation programs.
The benefits that cloud-based services provide utilities were highlighted in Black & Veatch’s Strategic Directions: Utility Automation & Integration report released in January 2014.
That report stated, “Multi-tenant systems (cloud-based) have the scale and security needed to safeguard critical operational data and sensitive client information. Most importantly, they give even the smallest organizations cost-effective access to big system capabilities. Previously inaccessible computing power and data analytics and management tools can be deployed to increase efficiency and help facilitate data-driven management approaches.”
Cloud-based services are closing the technology gap between small and large utilities. No longer will the latest technology be limited to large organizations capable of supporting dedicated IT budgets and staff.
To achieve the desired future state of highly automated and efficient operations, such as a one-person water plant operation, utility leaders should incorporate technology master plans into their overall asset management plan. After all, evolving from a highly manual process organization to a fully automated utility will take time, change management and a thorough evaluation of current practices and future needs.
In an era where utilities are constantly looking to ‘do more with less,’ investing in automation technologies and greater intelligence will help water leaders meet their efficiency goals, become more resilient and provide greater levels of customer service.
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