Branndon Kelley, CIO at American Municipal Power, Inc.
Jason Skidmore, CEO at Vernovis
Welcome to another ComSpark podcast, where you get to meet today's technology thought leaders.
JS: Okay. We're here today with Brandon Kelley, who is the Chief Information Officer at American Municipal Power, which is an organization based in Columbus, Ohio with about 200 employees. My name is Jason Skidmore. I'm with Vernovis, and I will be your guest moderator today. Branndon, thanks for joining me.
BK: Thank you, Jason.
JS: Yeah, I look forward to the conversation. So, I'm really excited to learn a little bit more, not only about your thoughts on some technology initiatives, but specific to your industry as well, because you guys are well-positioned there. So, I'll start with the concept of emerging or disruptive technology. Tell me a little bit about, relative maybe to your experience in your industry, tell us a little about your industry and what, maybe, one of the most exciting disruptive technologies is right now?
BK: Sure. So, I mean, at the heart of it, we’re electric utility, so we own and operate power plants and we provide electricity to residents and commercial and industrial, and uh, and really focus on the municipal space. So, municipals, cities, townships, burrows – and that's in nine states representing 135 members. And so, uh, it's an old business, right? Electricity, well over 100 years old. Uh, but it's, uh, it's an industry that's really being impacted, really in the last 20 years and, if you really look at it, in about the last 10 years. Maybe even overplayed to a certain extent, we've all heard about Smart City or Smart Grid. Those technologies are doing something in the electric utility business, which has been something that we prided ourselves, hadn't happened for a long time. And that is connectivity. So, I like to talk about disruption caused by two things.
It's caused by connectivity, which, and then drives data growth, right? So, in our business, it's the Smart Grid, the Smart City initiative. It's all about connecting devices, allowing us to get more information, to be able to make better decisions, ultimately to run our electric utility and our devices and our plants and our assets better. Uh, however, when you connect those devices, you end up being faced with a huge amount of data growth. And data, at rest, is, is useless. And so, we like to think about taking data and turning it into actionable information.
BK:The other thing that happens with that connectivity is the security concerns. So, what, for the first 90 years or so of our business was considered air gapped, meaning, the only threat would be physical, someone who come in and put their arms around it, now all of a sudden, can be touched, in theory, from virtually anywhere in the world where you could crawl through an IP address kind of chain.
BK:So, that, that's kind of the first real disruption. And so, um, you’re kind of in this, in this situation where the industry as a whole was heading there. We have a, a pretty new set of, fleet of assets that we just built. We have some older assets that we've owned and operated for a long time. And uh, we're faced with trying to run those most effectively and efficiently. And so we've, we've went down the path of connecting those assets and gathering that data and bringing that data back into a centralized repository in the long-term hopes of, of taking that and using that data and turning it into actual information or what, you know…today's kind of overused of whether it's predictive analytics or, eventually, machine learning or artificial intelligence. The other side of that I kind of alluded to is the fact that now, as part of the program that maybe we'll talk about in a bit, is, we're putting these devices in, um, uh, everybody's home and it's, it's – gone are the days of the electrical mechanical meter that are just kinda spinning. And this is now basically a sensor, so I can know how much electricity is being used and when it's being used. I, I can tell when the electricity is out, I can take proactive steps to get the right size transformer, so there's not overloading and there's not underloading, both of which have negative impacts to the customer base, both from a reliability and a cost.
Um, I also can start giving the customer more information to allow them to start making intelligent decisions. However, this disruption, again, all plays back into security, that most of these devices have the remote disconnect and reconnect capabilities, which allows us as a utility to be more efficient. When, when it's time to turn someone off, uh, it allows us to be more customer friendly. When it's time to turn someone on, we no longer have to have a skilled individual kind of make this trip. Um, however, a bad actor, uh, could potentially breach this, and they could cause these on and offs and, and cause problems that are related to that.
So, you know, we have a responsibility to enable the business to allow them to take advantage of these things, and at the same time, to have, uh, put in the proper security that allows us to take advantage, but protect those assets. So that, that's kinda one. And then, and, and new? Not necessarily. I mean, utilities have been going after these types of projects for about 10 or so years now, but new in the sense that the type of utilities, the small municipals that we deal with, um, haven't necessarily, for the most part, have not necessarily went down that path.
BK: And in, and in the forward looking, one of the things that, that we do at AMP is, we have a strategic plan. We have initiatives within that strategic plan and I'm the executive responsible for it, which is really titled Technology Enablement. And it's looking at all these other things, you know, one of the things about disruption and, and things that are happening is, and being a CIO, or, excuse me, an IT leader in general, is, you end up hearing constantly about these things and they become almost old news. But our business partners don't necessarily hear them as much. So, you know, we're looking and exploring opportunities, whether it be, is there a play for blockchain? You know, you've got this idea of peer-to-peer transactions. I have solar and electric need, how can I sell that? You’ve seen some of that happen in New York. So, as an organization we're looking at how we respond and how we can help. Because we, what we, what we do know, we don't necessarily know what the play is and how we get there, but what we do know is, if we, history tells us, if we sit back and watch and wait, we will lose. And um, if we jump in and be the first to act, we might light, we’ll likely lose or, or not do it the best. But we have to monitor, watch and act appropriately.
And then there's all other, there's a series of other types of disruption that's happening in our business. Um, I mean, I kind of mentioned them. Data analytics, predictive analytics, cloud. I mean, cloud is one of the things, as, as, you know, from an electric utilities point of view, it's been…you know, I'll tell you, overall we, AMP has been a little bit more aggressive in some of our strategies, how we're organized, how we’re sizes, kind of, what our vision is as an organization. The, some other areas of compliance and regulatory that we fall under that some others don't, but there's going to be a disruption in the sense that, um, you know, what we historically had done on-premise, we’ll have to start doing in the cloud just because, uh, we will not be able to staff appropriately from a talent shortage and from a cost perspective.
BK: Um, so it's, it's a big job and it's a lot to think about it. IT/OT, and then of course, cybersecurity across the enterprise as well as some of the, uh, economic and cultural pressures that we have.
BK: Um, but, um, you know, it pays the bills.
BK: We continue to show up and do our best on behalf of our members.
JS: That's great. Well, clearly your brain is always moving on this stuff. I can tell, absolutely. Tell me a little bit more, if it's possible to expound on that smart grid initiative? If I'm a member, what does that mean to me? How have you executed that and what's its, how meaningful is it to me?
BK: Yeah. One of the, you know, I joined AMP nine years ago. And um, in all honesty, I didn't even know it existed almost, until the day I got there. And, and that's a funny story in itself. Really, it was, I was supposed to be there two weeks, and I've been there nine years now. Uh, but we'll save that for another time. Um, so when I joined AMP, it takes a lot to learn about it. Obviously I knew about other utilities because, since I was 18, I've paid the electric and gas bill. Uh, I grew up and I heard my dad yell all the time about keeping the lights off because it was expensive, but I didn't really understand municipal systems or, or what an organization like AMP is. So, the best way to understand, um, the AMI program, which stands for Advanced Metering Infrastructure, or our Smart Grid/Smart City initiative, is to really understand what AMP is as an organization. So AMP is, is really a wholesale power provider, but organized as a joint action. So, many years ago, more than 50 years ago, um, municipal utility systems were really feeling a lot of pressure from investor owners to be able to provide affordable and reliable electricity to their cities, townships, municipals and burrows.
And um, and as an individual, you think about a small city, without giving any names, but 5,000 residents, 5,000 meters – they don't necessarily have the sophistication or the ability to hire all the engineers and all the necessary talent they need to, to deliver that to most reliable. They definitely don't have the buying power to compete against investor-owned utilities. And maybe even access to the, to the capital. So, we originally came together to solve that problem. It was really a power supply problem, as well as the legislative, to make sure our voice is heard. And, and we, that concept is called joint action. So people with, uh, like, like businesses, like problems coming together and working collaboratively to solve that problem.
BK: So we did, we did that successfully for, for 40-plus years. And then about 10 years ago, 10 years ago or so, the idea of Smart Grid started coming out, and some utilities started doing it, mostly in the invester-owned space. And then, uh, in 2009 with the election of President Obama, um, and, and some of the economy, uh, turnaround incentives that, uh, he put out in place, there was some funding that came out of the DOE, sometimes referred to as the ARA grant. And um, and some of our members went and took independent action. They started deploying this technology. And um, all of them to a certain extent had some issue that didn't allow them to either, a) successfully deploy100 to what they wanted to. They had to do scope scrape, um, or, b) even if they had success in the beginning, the long-term operations, and by long-term, I mean within a few years, uh, they were failing. So our chairman at the time, kind of really challenged us and said, hey, you know – and I’ll simplify this – but he goes, hey, you know, we're doing a really good job on safety, financial services, uh, building power plants, power supply, etc. all the other things we do. Why can’t we help solve these technology problems for these municipals?
And as a CIO and the executive, he's, uh, he basically tasked me with us. And so we did some surveys and then some groups, we brought together a Smart Grid advisory committee and basically, what came out of that was, through joint action, applying those same concepts, solving complex problems together, uh, we could develop a program that would achieve economies of scale, but more importantly than that, reduce the risk, and as close to guarantee as you can possibly have, guarantee not only successful deployment of the technology, but the long-term operations.
So, so me and Jared Price, who's my CTO, we kind of coined a couple things. We call it a meter-to-data center. So, everything from, uh, um, from the architecture to the purchasing, or excuse me, the architecture to the design and the procurement to the delivery, the installation, the configuration, the most important piece – the integrations – um, we manage, we manage that. We work with those local communities who are members, owners of our organization and we make sure that gets done. We, we become a big voice to the vendors. So, instead of an individual 5,000 endpoint, uh, customer to Silver Spring, Itron, you know, we are a collective group, at the time, of uh, well over a million meters. And so we started looking like, more like an investor-owned utility. So, we're not going to get jerked around.
BK: And then after that, the deployment’s there, we manage that for 10 years. Now we're not out in the field switching meters and dealing with widgets. What we're managing is that IT aspect, that piece that becomes disruptive to the utility – the data, the analytics, the making sure it’s upped every three years when Oracle knocks on the door and it's time for an upgrade, etc. We're managing that. And we're able to do it through joint action and we can, we can provide that back to a community and, uh, not to exceed the 10-year agreement. And um, and wrapping the cybersecurity, all these things that happen. And so, uh, that's, that's really what it is.
JS: Yeah, awesome.
BK: And it's, it's really, uh, foundational, right? So it's, uh, meter-to-cash is, is the thing, right? That the concept here is that we're gonna make the utility more efficient, because reading the meters and getting those billing determinants will just happen automatically over the air. But it becomes a foundation. And we chose Silver Spring. We didn't…we chose what we thought and what kind of is proven by, based on what most investor-owned utilities and big cities are choosing, as thenetwork. So now the network that can, that is going to run the city of Chicago street lights and a lot of their sensors, and the city of Paris and, and many others is the same one that can run for the village of Montpelier, Ohio. It's about 3000 electric meters who, um, is, our, probably our latest member to sign for the program. They're going to have access to it.
So out of the gate, their meter-to-cash will be solved. And when they're ready to grow in the street lighting or environmental sensors or whatever they want to do with this high bandwidth network, we’ll be there. And we'll be able to turn those on as end points. And, um, and it, this has been so successful in the sense of, from a concept to deployment, that about two years ago, my CEO and myself, Marc Gerken, we started talking about how can we unleash this to municipals across the country. There's well over 2,000 municipal electric systems in the country.
And so, happy to say that AMP and four other agencies across the country, we came together and we purchased the assets of a company called Hometown Connections on, effective June 1st.
And then in return they purchased the assets of this program I programmed myself and Jared and many others at AMP, uh, helped build. And now we're, we offer this program to anybody that’s in the municipal electric space. And it's a little different. So, we are not, we are services, AMI for municipal electric only. Uh, it's not, we're not after commercial business, I would say. And, uh, and it's really around the concept of joint action bringing people together, solving these complex technology problems that are complex in deployment, but it's really the 10 years or even more of the operations that typically gets overlooked or lost when you're going down these paths.
JS: Sure, absolutely. Wow. Branndon, just some great, great stuff there. Thank you so much for sharing all that, and I really appreciate the education and, uh, having, being a little more informed on this topic. So, keep up the great work.
BK: Thank you.
JS: Yeah, no problem. Well, again, this is Jason Skidmore with Branndon Kelley. To learn more about us, visit comspark.tech. And until next time, goodbye.
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