News From POWERGRID International
Biggest little city hosts Autovation 2007
by John M. Powers, online editor
Autovation 2007, the Automatic Meter Reading Association's (AMRA) annual international symposium, celebrated its 20th anniversary in Reno, NV from September 30 to October 3 and, from the outset, sent a message to those attending: The industry is changing. It became clear to attendees that today's advanced metering involves a lot more than just a box on the back of a house and a tool to read said box. These days it's all about the data.
To drive the point home, outgoing AMRA president Jim Andrus announced at the first general session that the association is changing its name to better fit the growing scope of advanced metering. To further highlight the changing landscape, the Autovation 2007 keynote featured in-depth financial analysis of the market and opinions from heavy hitters in the industry along with days packed full of educational presentations about new initiatives and technologies.
At a press conference about AMRA's decision to change its name, Andrus and AMRA president-elect Stephen Carrico of Lee Lake Consulting (recently featured on episode 7 of Currents) explained that the name change, from AMRA to Utilimetrics, is a response to the shift from the advanced metering industry emphasizing "the physical box and the technology needed to read it" to a greater emphasis "on the data collected from the meter."
"We knew we had to roll out a new image," said Carrico.
Andrus and Carrico said Utilimetrics hopes to become more visible to regulators and policy makers by being a neutral voice "providing information on metering technologies and the value that can be derived from their uses." The name change, said Carrico, "is our first step to being noticed." But Utilimetrics won't have to do all the work to get recognized. The market will do some of the lifting, too. According to Andrus, the advanced metering market is growing and will continue to do so, which will attract attention from outside the traditional boundaries of metering.
If you think that's just self promotion, consider that Andrus has Citigroup's Investment Banking Division saying the same thing about the market. At the first general session, Benjamin Koch, director of investment banking at Citigroup, said that, even though the market has been "hit with two storms," it will continue to grow.
The two storms that have hit the wider market, Koch explained, are sub-prime mortgages and leveraged lending. While the storms have caused some problems, the economy has stayed robust and corporate defaults have stayed low -- stabilizing factors for the market, according to Koch.
Despite worries in the wider markets, Koch said investors believe there is an opportunity for growth in advanced metering. Koch said investment in advanced metering is already up 20% relative to the NASDAQ. His reason for this positive outlook was "macro trends." The population is growing, oil prices are soaring and people are more worried about pollution; all trends, Koch explained, that are driving the advanced metering market. Advanced metering also has a low penetration, which gives it "a huge potential" for growth, he said.
Koch said that equity investors are looking for sectors and companies that have a "large and addressable market," a unique technology, potential for growth and experienced management teams. The advanced metering market, he said, fits such criteria and so the industry can expect to see equity investment in advanced metering stay strong. In the end, Koch said, advanced metering is being looked at as a strong long-term investment.
As concrete proof of the potential Koch discussed, Cameron O'Reilly, founder and managing director of the advanced metering acquisition machine Bayard Group, took the stage and explained his company's philosophy of investment in advanced metering. O'Reilly said Bayard Group is "focused solely on buying, building and growing businesses providing advanced metering." In fact, O'Reilly added, that was the reason Bayard Group formed. The company is designed to grow for the long term (and not sell assets), exclusively focusing on advanced metering companies.
Bayard made their first investment in September 2003 by buying Email Metering and Ampy Metering. Then, in 2004, they bough Landis+Gyr and, in 2006, they bought Enermet, Hunt Technologies, Statsignal, and Cellnet. In all, Bayard Group has invested $1.2 billion in advanced metering companies. And O'Reilly only expects the industry to keep growing as energy prices and environmental worries rise.
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