DIGITAL ENERGY TRANSFORMATION

By Mark Damm Founder and CEO FuseForward 

ENERGYCENTRAL- Feb 8, 2021 -  According to the analysts at Kearney, the next ten years will be an era of fundamental change for the energy sector as more companies leverage digitization with the potential to increase long-term earnings by 25% or more. Energy and technology experts agree that technologies like the Internet of Things (IoT), advanced analytics, artificial intelligence, robotics, and automation are already elevating existing business models and creating new sources of value for utility companies. We can expect to see these trends continue in 2021. 

While it seems to be accepted wisdom that utilities are well into their digital transformation journeys, recent Capgemini research found that the sector has underestimated the true potential of digital transformation initiatives, using intelligent automation as an example. In fact, nearly half of the respondents under-estimated the benefits they derived from their digital initiatives. This is no small oversight—researchers estimate that the sector can save between $237 billion to $813 billion from intelligent automation at scale.

“Like their peers from other sectors, the energy and infrastructure sector is facing considerable headwinds when trying to scale their automation initiatives. Currently, only 15% have been able to deploy multiple use cases at scale,” they state.

In 2020, utilities were quick to embrace new digital solutions, with some making more progress towards digital transformation than they had for many years prior. I hope to see this trend continue in the coming year, and have identified a few foundational areas I believe will be areas of focus. By addressing these key areas, utilities will be setting the stage for truly transformative digital solutions in the future.

Trend 1: Tackling data silos

As mentioned, many utilities are missing out on implementing critical digital transformation use cases that can deliver outsized benefits. One of the reasons for this is that utilities are still dealing with enterprise architecture that inhibits rather than enables business transformation. Challenges faced with existing infrastructure include poor system integration resulting in data silos, and the inability to ingest or store large amounts of streaming, real-time data. Unfortunately, data is intricately linked to every aspect of the modern utility, and these challenges have a knock-on effect across all operations.

In 2021 we can expect many utilities to prioritize improvements in data management, with a strong focus on the reduction of data silos and the implementation of related technologies.

By reducing data silos, utilities will be able to focus on the strategic integration of assets and operations, using data analytics and intelligence to make the connections between actions or events in one place, and impacts in another.

Trend 2: Enhancing EAM systems

Enterprise Asset Management (EAM) is a technology-empowered method for organizing assets, improving efficiency, and maximizing your investments. When combined with rich sources of data, including streaming data from field devices, EAM systems can offer utilities a truly competitive edge.

For organizations looking to augment asset management with rich data sources, cloud-based models are best. However, many utilities still have their EAM system on-premise, with work orders remaining manual and on paper. Security has always been a key driver for this, but with many utilities forced to move the majority of their operations online in the past year, there is now increased understanding that cloud systems can be implemented in a way that meets high-security needs.

With EAM systems in the cloud, utilities have the ability to integrate streaming data and advanced analytics, providing asset managers with granular insight into all areas of their operations. This insight goes further than merely optimizing maintenance cycles, and allows utilities to leverage new opportunities, such as automated control, machine learning, and even augmented reality solutions.

Regardless of where an organization is in its digital transformation journey, moving EAM to the cloud and augmenting this with additional data sources can deliver big benefits. I hope to see increased focus here in 2021.

Trend 3: Cybersecurity

Cybersecurity is always important and there is no doubt this will continue to be an area of focus in 2021. But while cybersecurity concerns were once a barrier to innovation, an increased need for remote operations means today’s utilities will need to tackle security issues head-on.

The increase of distributed network systems and edge devices requires additional security planning and design, and I believe we will an increased expansion of security as a result of this.

Setting the foundation for a digital future

With the right partner, utilities can integrate their complex, security-conscious EAM systems with other systems and data sources in the cloud. By focusing on these areas in the coming year, utilities will set a strong foundation for comprehensive advanced analytics and automation, creating a truly intelligent digital solution that provides the basis for a more efficient and future-proof organization.

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This thought leadership article was originally shared with Energy Central's Digital Utility Community Group. The communities are a place where professionals in the power industry can share, learn and connect in a collaborative environment. Join the Digital Utility Community today and learn from others who work in the industry.

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