by Tim O'Connor
(5-7 min read)
Starting in mid-September, homes and businesses in some areas of the Lincoln Heights neighborhood will begin receiving the next generation of advanced energy meters also known as Advanced Metering Infrastructure (AMI). These new meters are not just upgrades to little boxes on the side of a house—they signal the potential start of a city-wide modernization effort at LADWP. Once deployed, AMI and data-management systems they are integrated into can lay the foundation for a utility system that is smarter, more resilient, and better equipped to deliver affordable power and water to millions of Angelenos.
While much of the AMI technology being deployed is new to Los Angeles, it has been widely adopted by utilities across the country for years. And across the nation, AMI is seen as a critical unlock for billions of dollars in savings for ratepayers.
What is AMI?
AMI is a major component of the backbone of a modern electric grid system, replacing traditional meters with fully integrated meters that can communicate directly with the utility. But calling them “meters” barely does them justice. These devices are closer to an iPhone than a counting device, combining sensors, data processors, and communication networks to give both customers and LADWP the ability to adjust to energy needs in real time.
For customers, AMI can yield more accurate, more transparent, and easier to manage bills. Customers with advanced meters can gain clearer understanding of energy use and how small changes can save money. For the utility, AMI enables things like faster and more precise outage management - so the utility knows instantly when the power goes out, pinpoint exactly where the problem is, and restore service more quickly.
At a macro level, AMI also opens the door to a new era of energy - leveraging and unlocking advanced computing and new energy technology across the grid. For example, as more Angelenos add rooftop solar panels, battery storage, and electric vehicles, AMI provides the connective tissue that makes the system work more efficiently. Advanced meters can enable two-way flows of energy, support LADWP predicting and balancing supply and demand more intelligently, help the City use renewable resources when they’re most available, and accommodate new programs that allow ratepayer contributions to the grid be recognized and rewarded fairly.
What LADWPs Slow-at-first Strategy Means for Ratepayers
Deliberately deploying AMI in pockets of Lincoln Heights is an early step in LADWPs modernization journey. At the outset, the utility is going to be focused on the basics: integrating new meters with outage management and remote readability. These core capabilities will strengthen reliability and streamline operations, while giving LADWP time to ensure customer information and experience are fully protected.
Over time, the benefits of AMI can grow significantly with proper planning and system integration. One of the clearest examples is the move away from manual meter reading to remote reading. Today, LADWP primarily relies on workers driving from neighborhood to neighborhood, visiting each meter individually, and keying in data manually. With more than 1.5 million electric meters, about a million of which are read manually read, and other 700,000 manually read water meters, that adds up to thousands of miles of driving and millions of data entries, resulting in substantial costs every month supporting low tech and manually intensive operations.
With deployment of AMI over time, operational costs can be significantly reduced through efficiencies and technology adoption, while transforming how staff resources are used. A single remote meter reading system can collect data from thousands of homes instantly, eliminating the need for trucks on the road and call-backs to homes and businesses. As a result, LADWP staff can be redeployed into higher-value work such as supporting customers and clean energy programs, addressing complex service issues, and advancing grid modernization.
Of course, the full benefit of remote meter reading will only materialize if LADWP moves both electric and water meters to AMI. While water meters are not part of the current effort, a slow-at-first strategy for electric meters gives LADWP an effective onramp for a fully remote meter reading strategy down the line.
Building the Grid of the Future
Los Angeles is entering a period of unprecedented change in how energy is produced and consumed. Over the next decade, LADWP must integrate massive amounts of clean power, prepare for hundreds of thousands of electric vehicles, and support more rooftop solar and distributed energy resources than ever before. Each of these changes present both opportunity and complexity.
That’s where advanced metering plays a critical role. By giving the utility precise, real-time information—and the ability to work directly with customers to manage when and how energy is used—AMI can reduce the long-term cost of meeting clean energy goals. Instead of building additional power plants or investing in more expensive infrastructure, LADWP can use system data to balance load, smooth out peaks in demand, and optimize renewable generation when it’s available.
For ratepayers, this matters because it means meeting the City’s clean energy goals at a more affordable price. For example, by conserving or shifting energy use to the right time of day, and charging electric vehicles and home battery systems when energy is most abundant, AMI enables utility-wide changes that add up to lower system costs.
Opportunities on the Horizon
AMI is one of the smartest modernization efforts LADWP can undertake right now, touching nearly every household and business in Los Angeles, and nearly every business unit within the utility. However, even with ambitious goals it will take several years before all customers are upgraded and will require stress-testing, planning and appropriate sequencing along the way to protect ratepayers and the utility system.
Although the technology is ready today for LADWP’s electric system to start, the learnings may open the door for modern water meters in the future. With the same technology foundation, the City may be able to track water usage with more precision, detect leaks earlier, and give customers new tools to manage their bills. This dual opportunity makes today’s investment even more important.
The Role of OPA and the Road Ahead
Over the last decade, utilities across the country have spent billions on smart meters – with about 128 million AMI meters across the US today - but the long-term benefits can far outweigh the costs.
Lower operational expenses, faster response to outages, easier access of customers into beneficial programs, and better integration of renewables all add up to savings for customers. Just as importantly, AMI allows the utility to manage demand more effectively, protect reliability, and reduce the need for costly new infrastructure. Over time, this modernization effort can translate into cleaner power and more affordable rates for everyone.
For the Office of Public Accountability / Ratepayer Advocate (OPA), advanced metering is about more than technology—it’s about benefitting and protecting ratepayers. And since every major investment LADWP makes ultimately affects customer bills, OPA helps ensure benefits outweigh the costs. That means keeping a watchful eye on rate impacts, verifying that efficiencies are real, and encouraging operational excellence as AMI rollout progresses.
There is plenty of evidence that utilities who deploy AMI can deliver significant benefits for ratepayers. But of course, without proper planning and execution, it’s also possible that AMI benefits may not be maximized and may not be delivered as clearly as possible. As a result, OPA is closely engaged with LADWP’s rollout plans and actively tracking how the utility is designing and executing this effort. From the early-stage deployments in targeted areas of Lincoln Heights, to the long-term vision of citywide deployment, OPA is encouraged by the utility’s measured and integrated approach. We are confident that the utility is learning from past challenges, planning for the future technology needed, and positioning Los Angeles to capture the benefits of AMI. As this effort evolves, OPA will continue providing oversight, analysis, and transparency so that Angelenos know their investment is being managed responsibly.
Meters may be small devices, but the modernization they represent is a big deal—for our homes, for our utility, and for ratepayers who are funding the clean energy future of Los Angeles.