The rise of the machines: Automation and AI for utilities

AI and automation has moved from being science-fiction to being an inevitability that all businesses must plan for. Alice Cooke reports from an industry roundtable exploring the issues.

The relentless march of technological progress means exciting innovations continue to offer organisations efficiency and productivity gains as well as service enhancements that simply couldn’t have been imagined a few years ago.

With utilities under constant pressure to provide smarter, more affordable services, the ability to adopt innovations is critical but not always straightforward. Embedding new devices and systems poses challenges for cultural and process change, while pioneering the application of emerging technology can also carry organisational risks.

These issues apply not least to the advancement of automation technologies and artificial intelligence (AI). At an invitation-only roundtable event at London’s Charlotte Street Hotel, sponsored by Cognizant, innovation leaders discussed the challenges and opportunities these technology fields present for their businesses.

There’s no doubt the scope for applying automation in utilities, for example to increase consistency and reliability in transactional processes is ample. Some have already made inroads, but a recent report from PwC suggests there’s further to go.

It claims that, across UK business sectors, 30 per cent of existing jobs are ripe for automation. In utilities, the potential is even greater; 31.8 per cent of jobs in electricity and gas supply are “at risk” of automation and in water a staggering 62.6 per cent of roles could be reallocated to physical or “soft” robots.

Round table delegates weren’t surprised by the above average automation potential identified in by this report for utilities, but quickly latched on to the inflammatory language – “at risk” – which it used to describe automation opportunities.

Extended discussion of the communication and delivery challenges for automation project managers showed a consensus that implementing automation solutions is “a big cultural challenge” for any firm. Understandably, when employees find their roles are considered low skilled and transactional – ergo ripe for automation – they can be defensive and even obstructive.

Nevertheless, as Steve Kaye, head of innovation at Anglian Water Services, pointed out: “Automation allows us to understand how our systems are operating – it makes people’s lives easier and it prevents things from going wrong – it’s vital”.

Scope for AI

Speaking from a retailer perspective, Charles Grey, head of technology UK at Just Energy – the parent company for Hudson and Green Star Energy – agreed. But he also advised that selling a story of AI assistance rather than replacement can help adoption run more smoothly. “Let people tell you how they feel AI can enhance their roles, not just replace them,” he said.

Rolling discussion on this theme advocated a move towards “dev-ops” approaches to automation projects, which place system developers close to current process owners, working with them to develop solutions, rather than imposing them.

Turning to consider the scope for AI technologies in utilities, delegates were generally more tentative. AI was seen as a more advanced technology solution, and not all attendees had begun actively considering how it might advance their organisational goals.

Some, however, had strong views on the relevance of AI to core business challenges, and broadly, these views fell into three camps: how AI can enhance current processes by interpreting large datasets faster than humans; how it can transform existing processes by “crunching” disparate datasets and driving towards a given business outcome – perhaps enhanced cashflow – and finally, how it might be “let loose” on company and industry data to create challenges to the status quo. For Just Energy’s Grey, the latter provided a particularly exciting prospect. “I think the real potential of AI is to ask the questions we lack the imagination to ask and come up with ways of working we lack the imagination to consider,” he said.

More broadly, it was agreed that AI solutions have enormous potential to revolutionise customer experience, making interactions easier and more thoughtless – which was considered a good outcome, even if it drives away from “enhanced engagement”, which is commonly identified as a core utility goal.

It was also agreed that AI has a huge role to play in the creation of smarter energy systems, with complex balancing requirements and an ever-diversifying set of active stakeholders.

With intelligent, integrated energy systems in mind, discussion turned to consider the challenges involved in bridging the gap between today’s relatively dumb and reactive infrastructure. Smart metering, it was acknowledged, could allow water, electricity and gas to work through a single network, and allow individuals and businesses to closely regulate their usage and waste – and to “gamify” that monitoring by comparing usage to that of others.

“Smart meters have the potential to transform the network as we’ll be able to manage it better, and together,” said Anglian’s Kaye. Though he added: “At the moment there’s a layer of control in the way of that, but that may be something that can be changed going forwards, which would be a great step for all involved.”

Data pooling

Kaye’s comments sparked significant discussion of the data-sharing barriers currently holding back the true potential of automation and AI to transform utility infrastructure and customer experience. It was agreed that greater pooling of data arising from “non-competitive” but core industry processes could deliver step changes in operational and service efficiency across the sector. But currently, regulation and company reticence are preventing this pooling from happening.

There’s a long road ahead for utilities as they look to get the most out of automation and AI solutions. But this debate left little doubt that both technology fields will increasingly define the industry’s future. As Sean Heshmat, AVP venture leader at Cognizant put it: “There will come a point where everyone must adopt these if they want to survive.”

Key takeaways

• Conducting automation projects is a cultural challenge. Managers must communicate carefully to avoid creating fear of job loss or undermining employee sense of self-worth when their work is automated
• Building business cases for automation and AI investment is a two way process. It must build from bottom up but also have strategic understanding from top down
• AI is a relatively nascent technology field for utilities, but has huge potential to enable a flexible decarbonised energy system
• The value of data analytics and AI to utilities could be amplified if barriers to data sharing across industry were broken down. An opportunity exists to realise significant whole industry efficiencies through sharing data around processes which are not key to competitive differentiation
• AI could transform customer experience of utility services – but is likely to diminish “engagement” as interactions will become increasingly automated and “thoughtless”

Views from the table

Sean Heshmat, AVP venture leader, Cognizant

“Companies have to embed the culture of continuous internal learning and exploration regarding the opportunities presented by AI and automation. Those who don’t, will most likely be left behind.”

Richard Abba, senior project manager, Engie

“Automation allows good employees – who you hired  because they are talented – to better utilise the skills you employed them for by freeing them from the daily admin churn.”

Gautham Krishnadas, research engineer, Flexitricity

“AI can augment and enhance existing work. It’s not simply a question of scrapping what was already there – there’s a right way to introduce it, and this is vital.”

Mark Herring, head of innovation strategy, National Grid

“To make progress in artificial intelligence you need engagement at all levels, which means finding the people within your company who are excited to explore the potential of AI and who want to make a difference – a sound business case only comes alive with the enthusiasm to experiment and learn.”

Charles Grey, head of technology UK at Just Energy

“Let people tell you how they feel AI can enhance their roles, not just replace them.”

Carlos Nasillo, AI lead, Innogy Ventures

“At Innogy we believe that AI will impact every aspect of the energy value chain – from generation, to distribution to our retail customers.”