Weekly Brief

6 Utility Insights Enabling a CIO's Success

Utilities Tech Outlook | Monday, September 23, 2019

As digitalization transforms the utility industry, many businesses are turning towards digital technologies to flourish in the new age.  

FERMONT, CA: How do utility CIOs, in the era of digital utilities, determine priorities? For every utility CIO today, this is one of the toughest challenges. The utility industry is undergoing several fast, far-reaching, and unprecedented shifts. As they modernize the sector and plan for future development, digital technologies have emerged as powerful, enabling forces for utility managers. Many leaders are reconsidering how they address a wide range of problems at the company level, including investment planning, resource allocation, and performance and risk management. CIOs are often caught between reconciling heritage and new technologies amid the fast digital transformation sweeping across utility companies, confronted with conflicting goals and restricted by limited funds. In the utility industry, there are few significant regions which CIOs prioritize.

Digitalization 

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For several centuries, the implementation of digital surveillance and control techniques in the power generation and transmission fields has been a significant trend and has lately begun to penetrate deeper into power systems. The wider use of smart meters and sensors, the Internet of Things implementation and the use of artificial intelligence have developed possibilities to provide the system with new services. Digitalization is also increasingly relevant due to advances in decentralization and electrification. Detailed and real-time information on customer trends, load profiles, and component efficiency in electrical installations may allow grid operators to plan better and operate the system.

Towards a Low-Carbon and Secure Energy System

The world is experiencing a shift to a more inclusive, safe, cost-effective, low-carbon, and sustainable future in the energy industry. Renewable energy is one of the key building blocks. This transition is fostered by unprecedented public pressure and policy intervention, rising air pollution and stress on water, as well as growing climate change concerns. With innovation as the main driver, the energy transition is now developing further. The power industry leads the continual energy transition, driven by the fast decrease in the cost of renewable electricity, especially for wind and solar generation. Progress in techniques for renewable energy generation provides possibilities to use renewable power as a vector for decarbonizing end-use sectors. Based on innovative business models and market designs, smart electrification methods are essential to realizing these synergies and taking advantage of the potential flexibility offered by the fresh loads.

Emerging Trends  

Policy frameworks for Variable Renewable Energy (VRE) must mix current (deployment) needs with future requirements (scale integration of VRE into the energy scheme). There are real trade-offs between quick wins and long-term strategies. Policymakers should not concentrate too much on quick wins when targeting elevates the rates of renewable energy deployment and inclusion; instead, they should look forward to a moment when renewable energy deployment has been effective and should design systems around these paradigms.

Shift to Agile Workflows

Utility industry professionals are used to dealing with changes. As it turns out, decades of addressing supply and demand differences, changes in grid efficiency, and fluctuating market prices have hindered our readiness to be agile for today's digital transformation. In particular, when dealing with unstable, uncertain, complicated, and ambiguous generation, transmission and distribution scenarios, digital utilities that are effectively implementing a flexible structure reap beneficial ROI. 'Agile' doesn't necessarily mean' disruptive, CIOs can use agile management methods, workflows, and procedures to prevent disturbance during the shift or a change.

Innovative Wholesale Market Design

To allow a big proportion of VRE to penetrate into power grids, trading laws must change in energy markets. To counteract the short-term variability and uncertainty of renewables, policies must adapt to the new market circumstances and value flexible behavior. New products should be intended, and fresh respondents should be permitted to deliver their services. For instance, in all wholesale industries (power, ancillary service, and capacity market, if one is formed), the demand-side reaction should be able to engage in the same manner as supply-side generators. Increasing distributed generation deployment, along with consumer-ended storage technology and enhanced demand response transforms customers into active participants in the market. Market regulation is essential to unlocking flexibility on the demand side.

New Talent Acquisition

The digital utility's increase has established a marked skill gap between its aging workforce and the knowledge required to build and handle future grids. Digital utilities has launched a new wave of utility employees, including tech-savvy technicians, information researchers, and specialists in automation. All utility firms rely heavily on their capacity to obtain younger talent with digital skills for business continuity.

The latest abilities will be critical to guide a business through infrastructure and possibilities to increase value and mitigate hazards in the energy industry. Utilities that listen to these evolving trends and concentrate on ensuring the fundamental abilities will be in a better competitive situation. Businesses need to learn to operate in fresh ways to profit from digital, and CIOs rethinking on priorities could be the secret.

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