How to Read an AMI Business Case: CL&P's Four Headline Ratios

An AMI business case is not one number. Connecticut Light and Power’s July 2026 advanced metering filing shows why. Its benefit-cost analysis reports four headline ratios for the same program. One sits above 1.0 and three fall below it. Which one a reader quotes decides whether the program looks justified.

For a municipal utility or cooperative weighing its own AMI business case, that spread is the useful part. The ratio is the output of a handful of choices: the discount rate, the analysis horizon, which benefits count, and how carbon is valued. Change the choices and the answer crosses 1.0.

What CL&P Filed and What PURA Did With It

On July 21, 2026, Connecticut Light and Power, doing business as Eversource Energy, petitioned the Connecticut Public Utilities Regulatory Authority (PURA) in Docket 26-07-08. It asked PURA to review its benefit-cost analysis and approve an accelerated AMI rollout across its service territory over six years starting January 1, 2027, using the technology solution implemented for Massachusetts.

PURA did not rule on the merits. On September 11, 2026, it took no action on the petition and closed the docket, stating that Docket 17-12-03RE02, where it set Connecticut’s AMI framework in January 2024, is the proper proceeding for the plan. PURA noted the company had also filed the plan in its rate amendment application, Docket 26-05-10. The same memo opened a new investigation, Docket 26-09-02, into technology and policy approaches for measuring, monitoring and billing end-usage.

So the AMI business case has not been rejected. It has been redirected. The question of whether the ratio is good enough is still open, which is why it is worth reading closely.

Four Headline Benefit-Cost Ratios for One AMI Program

The analysis, Exhibit CLP-AMI-3, runs 20 years and present-values everything to 2026 dollars at a 7% discount rate, which the filing says Docket 17-12-03RE02 requires. Here are its four headline ratios. A sensitivity section adds six single-input cases from 0.79 to 0.87, and says the ratio passes 1.0 if AMI cuts energy use by 5%:

Basis	Benefit-cost ratio
20-year nominal, all quantified benefits	1.06
20-year nominal, excluding carbon reduction	0.88
Present value, all quantified benefits	0.77
Present value, excluding carbon reduction	0.66

On the present-value basis, the filing puts costs at $1,557.3 million against $1,205.4 million of quantified benefits, a net of negative $351.9 million. On the nominal basis, the same program shows a positive net benefit of $145.1 million.

Two assumptions do most of the moving.

The discount rate. The exhibit says it plainly: nominal benefits over 20 years exceed nominal costs, but costs land early in the program and benefits arrive after most of the spending, so discounting pushes the ratio below 1.0. Any AMI business case with front-loaded deployment and slow-building benefits will show the same shape.

Carbon. Carbon reduction benefits are valued at $441.3 million nominal and $176.8 million in present value. The filing ties the bulk of that benefit to volt-var optimization (VVO), and its VVO timing is inconsistent. The no-carbon supplement says VVO is enabled in Year 3. Elsewhere the filing says VVO implementation does not begin until Year 5, with full VVO benefits by Year 10 in one section and from Year 11 in another. Remove carbon and the present-value ratio drops from 0.77 to 0.66.

The Cost Side Is Mostly Not Meters

It is easy to read an AMI program as a meter purchase. The filing’s cost breakdown says otherwise. Over 20 years in nominal dollars, the exhibit lists meters at $340.0 million. The customer information system (CIS) is $536.8 million. VVO enablement is $377.3 million, and communications upgrades are $302.2 million. The meter data management system, the contact center, cybersecurity and a customer portal add more.

That matters for procurement. If the board approves “AMI,” it is approving a back-office systems program with meters attached. Meter hardware is the most visible line item, and the filing puts it below both the CIS and VVO enablement. Meters are about 13% of the $2,568.7 million nominal 20-year cost.

What to Ask Before You Approve an AMI Business Case

None of this makes AMI a bad investment. The filing argues that the benefit-cost analysis is one criterion among several and does not capture benefits that are hard to price. That is a fair position. It also means the ratio alone should not be what gets a program approved or killed. Before your board votes, ask for:

• The ratio on every basis. Nominal and present value, with and without any policy-valued benefit like carbon. If a vendor or consultant hands you one ratio, ask for the other three.
• The discount rate and why. A regulator-mandated rate, your cost of capital and a public-sector rate will give different answers. Know which one you are looking at.
• The benefits that carry the ratio. Find the three or four benefit categories that account for most of the value. Check when they start. A benefit that depends on VVO or a new rate design only arrives once that capability goes live.
• The cost categories beyond meters. Get the CIS, meter data management, communications network and integration costs in the same view as meters. Then scope your RFPs to match.
• The life assumptions. Meter life, network refresh cycles and the undepreciated balance of meters you would retire early all move the math. CL&P’s case includes a line for the undepreciated balance of its existing meters.

If you are sorting out where AMI fits alongside other modernization spending, our grid modernization procurement guide lays out the layers. Metering is also becoming a market question: CAISO’s DER wholesale participation rules turn on metering, and DERMS procurement lists AMI among the systems a VPP mandate pulls in. The same data can serve both the business case and the market, but only if the spec asks for it.

Related Reading

• CAISO DER Wholesale Market Participation Hinges on Metering
• DERMS Grid Modernization Procurement Goes Mainstream
• The Affordability Crisis Is a Distribution Equipment Story

Figures are from Exhibit CLP-AMI-3 in PURA Docket 26-07-08 and PURA’s September 11, 2026 closing memo. The docket status of 17-12-03RE02, 26-05-10 and 26-09-02 after that date was not reviewed for this article.

A ratio quoted without its basis can make the same program look justified or not. The Feeder is our free digest of the regulatory and supply signals that change what utility buyers spec and approve.