MLGW's plan for full scale smart meter deployment involves one contract with Elster for $228M (plus a $12M contingency) for the purchase of electric, gas and water meters; the purchase and installation of the Wi-Fi telecommunications infrastructure; the purchase and configuration of the required IT hardware and software; and installation of any meters that Elster may need to install.
Until the City Council approves the contract, there is still an ongoing need to replace in-service meters when they are not functioning properly due to their age. Since 2014, retired gas and water meters have been replaced with regular digital meters that can be converted to smart meters with the addition of communication modules. However, communication modules have not and will not be installed on any equipment until City Council approves the smart meter contract. Utilizing compatible equipment to meet current customer need is cost-effective as it will ultimately reduce the overall project cost by decreasing the number of smart meters purchased under the full implementation contract.
There is a separate water meter contract before City Council that ensures MLGW has an inventory of various sized meters to meet the current demand, including retiring worn-out equipment, maintaining water revenue and providing uninterrupted service to our customers. This short-term, three-year contract sets a fixed price for any meters purchased during that period. In addition, MLGW is not under obligation to buy any specified contract quantity and will only purchase equipment as needed.
In summary, the total cost of the planned deployment of smart meters has not increased since the Elster contract was brought to the City Council’s MLGW Committee in May 2015.