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Client Name: City of Santa Ana I AMI FEASIBILITY REPORT CO2 Reduction 400.06 metric tons CO2E in 18years Figure 15 City AMI Program Benefit Estimates © Meter Reading O Meter Operations u Billing Efficiency o Credit and Collection These estimates are based on an analysis of the information provided by City and Black & Veatch's experience and industry knowledge. The actual benefits will undoubtedly vary; additional benefit values will be experienced in some areas and less in others. The analysis performed to date is a high-level review and takes a reasonable approach, but more quantification can be done as the project progresses and the solution becomes more refined. The meter reading benefit includes the cost of the components that make up the meter reading organization today. Since a meter reading workforce is no longer required, all costs for current meter reading are captured as potential benefits. Costs related to the new organization and business processes to support meter reading activities are captured. The meter reading benefit also takes into account the cost of manual meter reading on a monthly basis. 10.1.3 Project Economics On the basis of the assumptions used, the initial high-level business opportunity assessment indicates that the project benefits cover a significant portion of the anticipated project costs. Actual benefits and costs will vary. Specifically, the initial project costs related to meters, MTUs, network and hosting fees offers the best opportunity for cost reductions as the City negotiates with the vendors. Given this initial estimated financial analysis, the business opportunity for the City for AMI appears both significant and valuable. 10.2 SERVICE LIFE While a service life of 15 to 20 years has been the expected norm and is widely quoted by most major AMI system vendors, the rapid evolution of metering and communications technologies is making this prospect more challenging. While a service life of 15 to 20 years is realistic for the metering infrastructure (e.g., DCUs and backhaul) and is certainly achievable for water meters, it is perhaps not realistic for the meter interface units to last 20 years. While most manufacturers offer 20 year module warranties, largely tied to battery life, 20 year service life may not be achieved from Li -ion powered field devices. Furthermore, most vendors begin their pro -rata warranty period at BLACK & VEATCH I Cost/Benefit Analysis 25G-167 49