What does it take for a power or utility company to implement a successful digital transformation? I find out from some of the top thought-leaders in the energy industry.
GE Power Chief Digital Officer Steve Martin
Power plants are like robots without brains, and AI can solve that problem by making physical processes more predictable and, in some cases, automated.
The cost of operations and maintenance for running the grid and power plants, even windfarms and large-scale solar, remains high. In 2018, I predict AI will rapidly automate basic maintenance of industrial processes, from real-time fuel optimization (which significantly impacts greenhouse gas emissions from coal and gas power generation) to windpower forecasting (whereby AI optimizes turbine blade positions to increase power yield).
At the same time, I foresee a blended human/AI approach to digitalizing operations that frees up human capital to focus on high priority issues. Electricity has a mature workforce with 25 per cent of industry workers reaching retirement age within five years, so power producers and utilities will need to invest substantially in creating a culture where operators are comfortable working in AI-enabled environments.
Susan Petersen Sturm is Digital Lead of the Power Generation & Water arm of ABB’s Industrial Automation division
It is crucial to have a big-picture vision for digital. Companies that are in the lead started with small projects and pilots that quickly delivered tangible results. Results and success drive action and greater cultural adoption of digital solutions on the plant floor. With the organization on board, larger and more ambitious project are easier to execute.
“It is all about people, process and technology. In digitalization, we talk a lot about technology but not about people and processes.
“Without changing their business process to get the results that digital solutions offer, companies will have great technology but little else. Digitalization should not make people feel alienated or excluded from the industry’s digital future. Companies need digital programmes, projects and pilots to engage the right stakeholders, which extend beyond operations and often involve information technology, compliance and finance. In other words, remember to bring the right team along on the digital journey.”
Patrick Kennedy is Chief Executive and founder of OSIsoft
To take full advantage of digital transformation, large power consumers and utilities will have to develop strategies that will effectively allow them to add IoT gateways and new sensors without ripping out their old networks.
Frankly, getting the old and the new will be one of the easier challenges to meet, but there will be speed bumps. Many IT vendors, for instance, don’t always fully appreciate the security and safety issues faced by operational departments. Standards bodies and industry associations will also likely mandate things like ‘chain of custody’ standards that will allow end-users to trace the full genealogy of any product they buy.
Martin Dunlea is Global Industries Lead for Utilities at Oracle
There is no doubt that Cloud solutions will play an increasingly important role in helping utilities to tackle the challenges they face.
A significant number of utility companies already use or plan to implement the Cloud, or use applications and computing resources delivered as-a-service via a network connection instead of traditional in-house resources.
To make the most of the Cloud, the utilities industry needs to disrupt itself and move away from its risk averse approach to technology investment. Many of the technologies that utilities are taking to the cloud today revolve around smart grid efforts and next-generation technologies —such as meter data management, big data analytics, and distribution automation and network management.
The successful utilities companies of the future will be those which have replaced legacy systems with more nimble, flexible applications that address evolving business processes in key areas, optimise existing business models and ensure that cloud technologies fit well within the broader organisation.
Ganesh Bell is President of industrial data science and artificial intelligence software company Uptake
What will it take for digitalization to become a mainstream reality?
I’ve long held a belief that every industry will be reimagined with software, and I foresee an end-to-end digitalized electricity value network. It will be a network in which every node doesn’t just generate or consume electricity, it also generates a data bit for every electron.
And the data generated will fuel our industry’s ability to drive-up efficiency, lower emissions, and bring more flexibility and resilience to generation and to the grid. It will also transform the way we operate and maintain our assets, and streamline labour-intensive processes.
Digitalization will give the industry the insights it needs to intelligently manage demand (and supply) from a proliferation of electrified buildings and vehicles. A connected Electricity Value Network will ultimately enable the creation of an Internet of Energy, and with it new business models for providers and more choice for consumers.
The journey to the empowered consumer begins with the digitalization of central generation and the grid. Without digitalized generation, no power producer will have the insights it needs to forecast accurately and trade intelligently in a digital marketplace. Without a digital grid, we can’t possibly seamlessly integrate distributed energy resources, nor put the power of choice in the hands of our customers.
Juliet Shavit is the founder and president of SmartMark Communications, a strategic communications firm which advises utilities
“There must be an understanding that the customer plays a role in any technology transformation. That was the number one mistake that the early utilities made – and it ended up becoming a huge barrier.
There is also a misunderstanding that smart technology by itself can do anything. It is the interaction between the technology and the people that creates the solution.
You can have the smartest technology in the world, but unless customers are engaging with them and reducing their energy use and playing a proactive role in the energy transformation, then really you don’t have a sustainable value. And you are not going to realize the investments into the technology.
One of the mistakes that utilities make is that they assume customers don’t care. They assume customers are afraid of technology. They assume these things have no impact on customers. And those are all big mistakes. Because if you get past the meter deployment, and talk about grid modernization and all the smart home products out there, then teaching customers how to utilize and optimize these types of technologies will only enhance the investments that utilities have already made.
So I think that one of the guiding compasses for utilities is to focus on their customer. If they decide that they can make their customer relationship better and the way they deliver service to their customer, I think that will help guide them through some of these confusing things.
Phil Beecher is President of Wi-SUN Alliance
The most important thing to remember is the end user. Power suppliers and utilities firms looking to utilize IoT technologies to drive internal and external benefits will only achieve success if they get the consumer on board.
This makes awareness raising and education programmes vitally important to sell your customers the benefits of any new IoT project. Your eye-catching new solution might have the potential to transform the customer experience, lower costs, improve efficiencies and drive greater business agility, but if your customers aren’t with you, all that planning and investment may be in vain.
We’ve already well and truly entered the IoT age. But unlocking value from these technologies requires more than blind investments in technology. Those organisations most likely to pull ahead of their competitors will be the ones that focus on security, performance and standards to drive success.