Guiding CFE on the Path to Smart Technologies

Q: How has Itron used its position within the market to bring new technologies and solutions to the energy sector?

A: The technology and energy industries merge in one respect, which is efficiency. Itron has strived to share its vision on efficiency and productivity in two main areas: energy and water management. Particularly in the electric sector, we have been working with CFE, one of the largest utilities in the world with millions of customers. Itron is advising CFE in the adoption of innovative technologies as the sector undergoes the Reform. CFE released Request for Proposals (RFP) with the objective of becoming more efficient and reducing non-technical losses, which represents an important opportunity for Itron and other firms in this industry.

Q: Which areas is CFE working on in order to increase its efficiency and reduce non-technical losses, and how will Itron help in these endeavors?

A: CFE is focusing its primary efforts in Mexico City and its surroundings. It is planning to cover approximately one third of the total population of the country, and it is working diligently to reduce field work, greenhouse gases, and improve customer satisfaction. In parallel, the company has been spending time in areas with high nontechnical losses rates. CFE will release more than 1.2 million endpoint RFP’s for smart metering technologies that will include meters, communication networks, data collection, and professional services. With the implementation of technology comes the challenge of managing data. Imagine capturing data from millions of metering systems across a dense urban area every 15 minutes. In the US, we helped CenterPoint Energy manage 220 million pieces of data per day for 2.2 million customers; doing so with CFE will be a considerable challenge, due to its approximately 36 million clients. There will be a need for enterprise systems (Meter Data Management and Analytics, among others) that will allow CFE to transform data into information in order to help the company make decisions, ultimately improving its business.

Q: How is Itron positioning itself to take advantage of the upcoming tenders?

A: Itron leads the industry with more than 15 million end points deployed across the globe and has projects in the US, Ecuador, Brazil, and Australia, among others. This will encourage CFE to move toward the path of smart technologies in order to secure a ROI. It is important to build a strong business case that incorporates transparency and clarity into all the benefits smart grid technologies bring to the table. Itron showcases all the operational efficiency, savings, and benefits that these technologies provide for companies like CFE. Operational maintenance cost is lower when implementing new technologies. If a utility in Latin America has 40% of non-technical losses, it purchases 100MW from a power generator company and only sells 60MW then it is only invoicing 60%. In cases like these, the ROI is incredibly fast when adopting new technologies and every year the utility sees more profitability. When investing in smart grid technologies, it is important to make sure their implementation is correctly followed through in order to maximize efficiency and savings.

Q: Which breakthrough technologies are you introducing in Mexico, and how are these tailored to the conditions of the local electricity market?

A: CFE is a big company and Itron acts as a partner by providing key technologies that will serve to improve operations. Products are tailored to the way the utility carries out its business and the way it operates. CFE has technical specifications and new technologies have to be aligned with them. In Mexico, we are also introducing the communication protocol IPV6, which is used in different countries around the world. The IPV6 is a standard and this open communication protocol gives CFE unparalleled flexibility and helps it adopt a range of different technologies. It was developed in order to address the growing need of connected devices, which is now impossible to support using the old IPV4 standard, since there are no more IP addresses available in the world to be assigned. Mexico is undergoing a considerable transformation process that is historical in its magnitude and breadth. Companies like Itron will help smooth the transition and ease this process. The regulators and operators, such as CRE and CENACE, need all the support available in order to execute the mandates dictated by the law.