The Duncan Banner

July 21, 2013

Honeywell project still stirring frustration

Replacement of 8,000 water modules could last months

Mike Smith
The Duncan Banner

DUNCAN — It has been more than a year since a $14.2 million energy and utility project in Duncan was declared complete, and more than two years since a “smart metering” network to keep tabs on water usage — a cornerstone of the plan — was put in place.

But once again, the project is entering a phase of not so fast.

Honeywell, the Fortune 100 company the city hired in part to implement a system allowing the city to collect electricity and water usage data from residents and businesses automatically, has more work to do.

The company is expected to spend the next several months replacing 8,000 water modules in Duncan because the ones installed a couple of years ago aren’t doing a good enough job.

The latest work is to begin late this month and could last past Christmas, and when all is said and done, most of the 12,000 water modules installed and attached to 12,000 new meters will have been replaced.

The new meters are designed to more accurately measure water use, and the modules read the data and send it electronically to a city database. The idea is to eliminate, in the vast number of cases, a need to visit homes and businesses and collect meter measurements manually.

Duncan Public Works Director Scott Vaughn said Honeywell is making the large-scale replacement of modules on its own dime, but only after a lot of prodding from the city.

“It finally got to the point, to be quite honest, where the city manager basically said, ‘This is enough, get it done, build it some way, we’ve gone on way too long,’” Vaughn said.

City Manager Jim Frieda has publicly expressed frustration with snags and delays in the Honeywell project, acknowledging it again during the last City Council meeting. More than a year ago, he referred to the project as a “painful process.”

Honeywell says the problems with the meter transmitters — also called modules — became apparent gradually over time and took several months to pinpoint.

But in a written statement to The Banner, the company said it has worked with the meter equipment manufacturer and the city to find an acceptable solution.

Honeywell said one of the benefits of its contract with the city is that it guarantees performance of the equipment and subsequent energy and operational savings, and is making good on its promises.

“We can appreciate why city officials are frustrated,” the statement said. “But we’re currently on the ground and working as quickly as possible to remedy the problem.”

The overall $14.2 million project, which also has included energy-efficient upgrades to city lighting and heating and air-conditioning in city buildings, is supposed to pay for itself over the next several years through energy savings and more utility revenue.

On the revenue side, the city is making more money from electricity and water in part because the new meters measure usage more accurately. Utility payments, along with sales taxes, are the two major sources of income the city uses to pay for the services it provides to residents.

But not long after installation of the water meters and modules was declared complete in August 2011, Vaughn said problems with some of the modules became apparent.

Under the contract with Honeywell, the success rate for the modules reading usage data and sending it to a city database is supposed to be at least 98.5 percent, Vauhgn said.

But for a long time — and still now — the rate has been around 90 percent, sometimes up to 95 percent.

“The majority of meters in fact have been working generally speaking, but a small subset ... has not been reporting properly,” he said.

That has meant, in some cases, having to go out and read the meters manually.

 Vaughn said Honeywell has spent the past several months replacing about 4,000 of the modules. It would replace between 200 to 400 per month, monitor the situation and make decisions on others to replace.

Honeywell said the manufacturer of the modules has corrected problems in its equipment, and to ensure the city’s system runs properly going forward, it is exchanging the remaining 8,000 modules “with next generation technology that can deliver even more benefits to Duncan and its residents.”

The company said it expects all the replacements to be complete by early 2014.

Vaughn said replacing a module usually takes less than 30 minutes and does not require that water at a residence or business be shut off.

He said a silver lining to the situation was the city getting the module upgrades at no cost.

But there have been other problems and delays associated with the project.

For example, until earlier this month, the city was unable to purchase new water meters and modules — or receive warranty replacements — for more than a year. That’s because the ones specified in contract with Honeywell were no longer available.

Honeywell acknowledged earlier that new lights installed on U.S. Highway 81 were not bright enough and agreed to fix that at company expense.

In a February 2012 memo, Frieda wrote that the project has required “many painful and contentious” steps to acquire the product desired in a timely manner.

At times, he said, the city had been reluctant to release funds to Honeywell because parts of the contract were behind schedule, and it appeared the company “was motivated by our refusal to release funds, rather than a desire to please customers.”

Negotiations to improve the warranty and the product have continued.