Innovation at the heart of the next-generation utility businessBy Francois Vazille
Against a backdrop of disruptive megatrends and rapid advancements in technologies, recent initiatives have cast the spotlight back on the utilities industry. This includes the recently announced carbon tax as part of Singapore’s Year of Climate Action, where facilities which produce 25,000 tonnes or more of greenhouse gas emissions in a year will have to pay a carbon tax from 2020.
Additionally, the introduction of a blockchain-powered platform by power utilities firm SP Group allowing households and small producers of solar energy to sell 'green credits' to buyers so they can offset their carbon footprint.
These developments have also been cemented by the liberalisation of the utilities industry with consumers now having the option of choosing their preferred electricity price plans from as many as 12 providers, since November 2018.
With competition intensifying in the industry, utility providers need to turn to innovation in order to achieve competitive advantage, business performance excellence and to improve the customer experience, while aligning with the nation’s sustainability goals.
Meeting the demands of the smart utility customers of today
Technological innovation is spurring this evolution of the customer experience, giving them more options, and customers now want from their utility providers the same instant access to the most up-to-date information—on the platform of their choice. Even more compelling is the technological transformation that has allowed personal energy insights to transform behaviour. Users are better advised on time-of-use rates and encouraged to shift their electrical usage to more economical times.
The utilities industry is embracing technology to streamline their business processes, enabling them to perform effectively and work productively. Asset operations today are able to detect and predict the risk of failures faster given the value of reducing the total cost of ownership and improving workforce deployment.
Powering real-time changes with data
Today, the daily life of utility centres consists almost entirely of data. Real-time data insights and actions such as sharing instant notifications on outages, problems, and power quality issues are driven by innovations such as Artificial Intelligence (AI)-programmed, self-healing nanobots. Consumers are also able to “order” audits of not just their overall energy usage, but at the granular appliance level, on top of being able to supply data history and analysis immediately. A customer service chatbot can also follow up through the same device.
Machine learning in particular has made remarkable strides in the utility industry in just the past few years, now permeating all parts of the utility enterprise.
Dealing with digital disruption in utilities: The game plan
The world is going to change dramatically. It will not be technology that will hold us back but our ability to use technology. In Singapore, where a carbon tax was introduced, this had resulted in stricter regulations for firms. Governments have to adapt regulations moving forward, in terms of how rates are designed, ownership of data, and who controls different transactions beyond the meter. Only when advancement in key energy technologies and the appropriate regulatory framework are working in tandem, will our goals of energy sustainability be met.
In the long run, a dual and simultaneous approach that includes both core business innovation and future business innovation is required. Utilities providers will need to use a more modular approach by leveraging technology to look for new revenue streams.
There is an opportunity for the cloud to play a role in all of this by taking utilities out of the business of doing the mundane work around maintaining technology environments and creating more time for utilities to innovate. As businesses need to spend more of their time and budget on innovation and less on maintaining systems, utilities will reap the benefits of the cloud as well as having companies assist in maintaining their environments for them, and ensuring the data and information are more secure, instead of having to do it themselves.