The electricity sector is ready to realise value from rapid digital transformation; value to the tune of an estimated $1.3 trillion to be captured globally from 2016-2025.
This is according to the World Economic Forum article Electricity: Uncovering value through digital transformation, which makes it clear that the energy sector is establishing and leveraging the building blocks of digitalization. To gain insight into key aspects of this transformation, PEI spoke to GE Digital’s Vice President of Engineering, GE Grid Software, Kristen Sanderson.
What trends are you seeing in terms of tech integration, IT/OT convergence within the power sector?
Traditionally, the operational systems managing the grid have been closed systems protected against the broader enterprise and isolated in OT. As an industry that has historically been slow to change, the addition of renewables is adding complexity to the grid and bringing an inevitable data tsunami.
We see the grid changing more in the next 10 years than it has for the last 100 years. In addition to the physical impacts on the grid, there are also security constraints. This is critical infrastructure, and driving higher security regulation and controls are a vital priority as external threats grow.
This faster pace of change is driving a need for value faster. The closed systems of the past are being forced into the enterprise and the IT space of many utility organizations.
What gaps are you noticing in terms of people development and training?
As the pace of change speeds up, so must the change in solutions and technology. People must then be trained in the new hardware and software technologies that form the basis of their system solutions.
The tsunami of data will result in new information to analyze and draw insights from. This will change how people work, what they see, and how they respond. This is digital transformation, and it will require training and change management at all levels of utility companies.
The utility workforce should have the proper education and training on new tools and technology for today’s digital era. But the reality is that only 3 percent of executives say they intend to significantly increase investment in training and reskilling programs in the next three years. This is a gap that will need to be addressed.
What impacts are these skills gaps having on businesses?
When we see skills gaps, this can really impact the pace of change utilities need to make. To realize this digital transformation, users must consume new technology, new information, and new processes into how they work. The demand is driving a faster pace, but human speed of change will slow it down.
Is this a purely technical training issue, or is there a culture / buy-in issue as well, especially with legacy staff?
This is about both. You have heard Peter Drucker’s famous quote “culture eats strategy for breakfast.” Digital transformation is forcing a rate of change from a 5-10 year period to a 1-2 year period. Legacy staff is the team who has the domain knowledge and experience managing the power grid. Their experience and knowledge is what can make this change successful, and yet they will be most affected. We have seen digital transformation efforts fail when this staff is not brought along.
Is there a recipe for successful digital transformation? What roles do you foresee in terms of the board / upper and mid-level management etc?
There is a recipe for success and it impacts all levels of the utility organization as well as the vendors who supply it. Utilities who are successfully navigating this change have a digital transformation leader who can recognize and lead the changes in operations and technology.
It is also necessary to shift how we technically change. Users are used to getting a large batch of changes every few years. The size and speed of this transformation no longer support this model. Instead, smaller units of change must be delivered into operations more frequently. This breaks down a large transformation into smaller increments that are more consumable, enabling users to engage in the overall wave of transformation successfully.
How are consumers utilitising digitalisation? Any trends or noteworthy changes?
There are a few trends driving utility shift toward digitization including the complexity of increased renewables. Traditionally, the distribution grid has been managed by paper maps as a sprawling radial network where telephones provide enough visibility to manage outages and keep electricity flowing reliably. As renewables on the grid increase, so does the complexity of operating the grid.
Not only does this create a tsunami of data, as mentioned above, it also creates new opportunities to optimize the grid. Each renewable can be optimized in different ways. With this visibility comes more connectivity of the lower voltage grid. The biggest value comes when renewables are orchestrated and integrated into the overall operation of the grid. Traditional, paper-based methods of managing the distribution grid would not suffice in this level of complexity. This opportunity requires digitization.
About Kristen Sanderson
Kristen Sanderson, vice president of engineering, leads global development of the Grid software portfolio. Kristen focuses on developing solutions in partnership with customers and guiding customers through their digital transformation, focusing on software solution integration and delivery across multiple regions, projects and customers. Throughout her tenure at GE, Kristen has held leadership and technical roles in both software development and architecture. She has a deep understanding of software across global markets and throughout the full energy lifecycle – from generation to transmission and distribution.
Kristen earned her B.S. in Computer Science and Mathematics from Auburn University in 1991. Prior to joining GE, she worked at Harris Corporation Controls Division as a Software and Project Engineer.