IBM Case Competition Slide Deck (Smart Meters)

Intro Solution Meters Marketing Conclusion

Key Issues

Consumer Habits

Implementation Cost

Payment Inaccuracy

Objectives

Low Cost Easy

Implementation Customer Interaction


Two-Step Plan

Smart Meter Customer Engagement


Smart Meter

Utility X Home

CENTRON Meter


Utility Benefits

Efficient Electricity Distribution Inefficient Electricity Distribution


Customer Benefits

Efficient Electricity Usage Inefficient Electricity Usage


Marketing Challenges

No Customer Left Behind

Historically Poor Relationships

Campaign that Divide Customer

Customer Illiteracy


Marketing Solutions

Tech Enthusiast (10%)

Value Buyer (20%)

Traditional Consumer

(10%)

Cost Conscious (41%)

Green Consumer (19%)

Value Bargain Premium

Eco

- A

war

enes

s


emPowering America

79

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Agree

Willing to Change Energy Consumption if it Affects America's Energy Challenges

88

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Agree

Need to Spend Money on Energy Infrastructure

88

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Agree

Motivated to use a Smart Meter to Make a Difference for Future Generations


Marketing Solutions

Tech Enthusiast (10%)

Value Buyer (20%)

Traditional Consumer

(10%)

Cost Conscious (41%)

Green Consumer (19%)

Value Bargain Premium

Eco

- A

war

enes

s


Q1# Q2#

2015 Month 1 Month 2 Month 3 Month 4 - 18 2016

Technicians Install Smart Units Analyze Data & Savings

Week 1 Week 2 Week 3 Week 4

Notification of Pilot Member Pilot Response

Pilot Timeline


Conclusion

Utility Revenue

Customer Savings

Easy Implementation

Bear Case of $120k in Revenue Over 4 Years

Bear Case of $1.8M in Pilot Savings

Customer Engagement

3 Month Implementation Plan

Over 80% Engagement Expected


Appendix A Smart#Meter#

Unit%Cost% %$35.00%%Bulk%Discount% 10%%

Base%Units%Purchased% %10,000.00%%Safety%Units% %500.00%%Total% %10,500.00%%

Discounted%Cost%Per%Unit% %$31.50%%Total% %$330,750.00%%

At#Home#Display#Rainforest+EMU/2+Energy++

Unit%Cost% %$60.00%%Bulk%Discount% 20%%

Base%Units%Purchased% %10,000.00%%Safety%Units% %50.00%%Total% %10,050.00%%

Discounted%Cost%Per%Unit% %$48.00%%Total% %$482,400.00%%

Appendix B Specialized#Technician#

Technician%Daily% %$200.00%%Unit#Install#Time#Frame# Technician%Hourly% %$25.00%%

Installed%Per%Tech%Per%Day% 14% Misc.%Daily%Costs% %$40.00%%Technicians%Per%Day% 20% Technician%Cost%Per%Unit% %$14.29%%Units%Installed%Per%Day% 280% Daily%Cost%Per%Unit% %$0.35%%Days%Till%CompleLon% 37% Total%Install%Cost%Per%Unit% %$14.64%%Weeks%Till%CompleLon% 7.4%

Total%Units%Installed% 10360% Misc.#Daily#Costs#Gas%Per%Day% %$30.00%%

Training# Daily%Fixed%Cost%(Truck/%Wear%and%Tear)% %$10.00%%Supplies% %$1,000.00%%(20%meters)% Total% %$40.00%%Trainers% %$600.00%%per%day/%2%trainers%300%a%day%Technicians%Daily%Wage% %$200.00%% Net#Cost#Per#Smart#Meter#Technicians%Trained% 20% Unit%Cost% %$31.50%%Technician%Total%Training%Cost%Daily% %$4,000.00%% Install%Cost%Per%Unit% %$14.64%%

Daily%Labor%Cost% %$4,600.00%%4%week%X%5%days%a%week% Total% %$46.14%%

Month%Total%Labor%Cost% %$92,000.00%%Total#Cost# #$93,000.00##

Overall#Cost#Total%Install%Cost%(Smart%Meter)% %$477,966.00%%Total%Display%Cost% %$482,400.00%%Total%Training%Cost% %$93,000.00%%

%$1,053,366.00%%

Appendix C

Electriciy#Usage# Electricity#Usage# Electricity#Usage# Electricity#Usage#Standard+Meter+ Smart+Meter+ Smart+Meter+and+Display+ Smart+Meter,+Display+and+Applica

Appendix C Connect#and#Disconnect#Cost#

Standard+Meter+ Smart+Meter+Customer%Base% %10,000.00%% Customer%Base% %10,000.00%%Percentage%that%need%service% 20%% Percentage%that%need%service% 20%%Cost%per%service%charge% %$25.00%% Cost%Per%Srevice%Charge% %$1.00%%Total%Cost% %$50,000.00%% Total%Cost% %$2,000.00%%

Savings% %$48,000.00%%

Monthly#Fee#Revenue#Customer%Base% 10,000%Percentage%that%change%habits% 90%%Customers%that%change%habits% %9,000%%Average%Bill% %$110.00%%Average%Savings% 13%%Average%Bill%Savings% %$14.30%%Average%charge% %$3.50%%Total%Prot%per%month% %$31,500.00%%Billing%periods% 18%Total%Revenue%per%two%years% %$567,000.00%%

Monthly#Fee#Revenue#Customer%Base% 10,000%Percentage%that%change%habits% 95%%Customers%that%change%habits% %9,500%%Average%Bill% %$110.00%%Average%Savings% 13%%Average%Bill%Savings% %$14.30%%Average%charge% %$3.00%%Total%Prot%per%month% %$28,500.00%%Billing%periods% 18%Total%Revenue%per%two%years% %$513,000.00%%Total%Revenue%per%four%years% %$1,080,000.00%%

Appendix D Cost#Savings#Analysis##

#Smart#Meter#ImplementaMon#/#MarkeMng#Overall%Cost%of%InstallaLon% %$1,053,366.00%%MarkeLng%Budget% %$70,000.00%%IBM%% %$200,000.00%%Total#Cost## %$1,323,366.00%%

Cost#Savings##Connect/%Disconnect%Program%Cost%Saving% %$48,000.00%%Meter%Reading%Cost%Saving% %$216,000.00%%Outage%Avoidance%Costs%Saving% %$100,000.00%%Revenue%Generated%% %$1,080,000.00%%Total#Savings#and#Revenue# %$1,444,000.00%%

Dierence# %$120,634.00%%

Appendix E

Electricity#Usage# Savers#Smart+Meter,+Display+and+Applica

Appendix F

#Value#of#outage#avoidance:##

%Customer's%Value%of%Lost%Load:%%%Customer%per%Year:%%

%Hours:%% 5%%Average%Cost/kWh%% $0.10%%%Value%of%Lost%Load%%% 0.5%%Annual%Demand%% 4125.86%

%Power%Outages%Avoided%with%Smart%Meters%% 99%%%Total%Value%of%Outage%Avoidance%%% %20.84%%

Total%Value%of%Outage%Avoidance%for%All%Customers% %208,355.93%%

Appendix G Cost%Saving%Benets:%

Metering%Costs:%Cost%of%InspecLon%per%Technician:%

Total%Number%of%Customers% %10,000.00%%Checks%per%Month/%Customer% %1.00%%

Total%Checks%/Month:% 10,000.00%Time%Required%to%Check%Meter% 5%minutes%Meters%Checked/%Hour% %12.00%%Technician%Hours/%Day% %7.00%%Meters%Checked/Day% %84.00%%

Total%Days%Needed%to%Check%Total%Meters:% 120%days%Number%of%Technicians%Employed% %6.00%%

Days%per%Month%to%Check%Meters%(%per%Technician):% %20.00%%Technician%Cost/%Day% %$150.00%%Technician%Cost/%Hour% %$13.00%%Total%Cost%of%Technician%per%Month% %$3,000.00%%

Technician#Cost/#Unit# #$1.05##Total#Cost#of#All#Technicians/#Month# #$18,000.00##Total#Cost#of#All#Technicians/#Year## #$216,000.00##

Appendix H

Federal%CommunicaLons%Commission%(FCC)%standards%for%intenLonal%and%unintenLonal%radio%emissions,%and%safety%related%to%RF%exposure,%parts+1+and+2+of+the+FCC's+Rules+and+Regula

Appendix H

IBM Case Competition Slide Deck (Smart Meters)

Documents

cost conscious

smart units

green consumer

traditional consumer

value buyer

month implementation

rainforest emu2 energy

data savings week