Connectivity and the future of utility value-add

Utilities need to realise the potential of smart communication if they are to be high value players in a smarter world says Jonny Cowlin.

Utility companies operate in one of the most complex, high profile, regulated and politically charged sectors. But even by these standards, the next decade is set to be the most testing yet.

New legislation, market reforms and emerging technologies are set to dramatically alter the landscape and impact existing business models. And that’s on top of ongoing challenges such as employee demographics, ageing infrastructures, and growing consumer expectations.

Emerging from this web of interconnected trends, we are now beginning to see the shape of the smart cities and energy grids, around which new value chains for social and commercial activity will gravitate in the future.

Utilities will be essential to the operation of these smart ecosystems, but they face a choice today as to whether they will lead change and become high value players in a smarter future, or whether they will simply follow trends, offering lower value services with smaller rewards attached – or be left behind completely thanks to disruptive developments in the market.

If utilities are to be central to smart cities and the smart grid at its heart – then a smart communications infrastructure is the enabler they need to underpin it all.

A good example of the impact a smart communications system could have on smart grid operation is street lighting, which accounts for about 15 per cent of a city’s electricity.

If we get it right, every single street lamp will be connected to a central control unit. Lamp failure can be addressed in real-time, street lights can be brightened as required to support safety, or dimmed down if there is no traffic on the road, resulting in greater power efficiency.

It is estimated that between 50 per cent and 75 per cent of energy and maintenance costs can be saved using smart lighting (based on LED lighting and intelligent lighting management). The UK is leading the world in the adoption of smart street lighting with 21 per cent (1.5 million) of the UK’s 7 million street lights already committed to being equipped with smart lighting CMS (central management system) technology.

The transformation starts now

In order to meet the dramatic changes in regulation, increased competition and continued digital disruption that are set to impact utilities, organisations need to be able to meet growing customer expectations as well as access, evaluate and act on massive amounts of data. To ensure all of this is possible, organisations need a joined up communications platform underpinning their business.

Only by getting an agile platform in place now will you have the connectivity needed to meet future challenges – in the short, medium and long term. The idea is to bring together disparate elements, extending connectivity to isolated sites and remote workers and joining up your operational technology (OT) and IT systems. Although the changes in themselves are small, the cumulative effect of getting different systems, processes and people talking to one another will be enormous. 

Technology convergence in practice

The convergence between smart technology and utilities is creating a new ecosystem of services to support a better quality of life while reducing consumption. This in turn will affect the structure of utility supply chains. Under the traditional model there was little scope for consumer empowerment and engagement. The model of a smart grid and smart meter supply chain changes all that.

A connected, data driven, information-aware business will be able to operate a diverse asset portfolio more efficiently by monitoring things to make sure everything is performing as well as it can. It should also use operational data to determine load constraints in the network, understand grid conditions, reduce damage, predict problems and be able to respond quickly. Utility companies will also need to communicate more effectively among colleagues and with partners and suppliers as well as improve customer service consumer engagement to become a trusted long-term supplier.

Most of the technology we’re talking about already exists. Forward thinking water and energy companies are using automation and ICT to improve the way they work. But this is just the tip of the iceberg.

In today’s changing world, innovation can make all the difference. Technology, when designed specifically to meet an organisation’s needs, can unleash the creative potential to face challenges head on.

Utility can deliver exceptional customer experience, while better orchestrating their business. Bringing together their remote sites, head office, and supply chain to work in harmony will improve people’s productivity and give them the freedom to perform anywhere and serve their customers better.