Market View: How analytics could change the way you do business

It would be risky not to embrace analytics tools now and advance with them as they mature, says Neil Strother, a principal research analyst with Navigant Research.

Many utilities are quite familiar with the Internet of Things (IoT). Smart meters are, after all, IoT devices. But what they struggle with is the output of smart meters and other advanced grid technology: the volume, velocity, and variety of data flowing from IoT deployments within and beyond their control. That’s new.

Terabytes of data flow from connected IoT devices, creating big data. But that is merely descriptive. The key question: what meaningful things can be done with big data? Answer: analytics can unlock valuable business insights from data.

Unfortunately though, most utilities lack the necessary analytics tools and skills to make the data work for them. But they are far from alone in this regard – many other industries face a similar challenge.

Harnessing new data sources

For utilities, the data analytics challenge keeps expanding. Not only is there a need to mine data from meters and distribution assets under their control, but they must also harness newer behind-the-meter data sources. These sources include devices like smart thermostats in homes and commercial buildings, submeters, and distributed energy resources (DER), such as solar PV arrays and customers’ onsite energy storage systems.

Frankly the increasing volumes of IoT device data can be overwhelming, especially as experts in the field often describe the digital information in terms of data lakes, data rivers, and data fabrics.

Utility managers seem to recognise the challenge created by this data surge and the need for analytics. Nearly half of the utility managers and key personnel who responded to an ABB-sponsored survey last year said the biggest hurdles holding back analytics projects, (in order), are data availability-access (23%), a skilled staff and lack of a centralised location for data storage (both at 19%), and budget or lack thereof (13%). Money for analytics is interestingly not a key issue.

Embracing IoT analytics will be crucial

Navigant Research believes utilities need a new strategy, one that fully embraces analytics in the IoT era. This is necessary for utilities seeking to digitally transform their businesses to the Energy Cloud future, where digital processes drive actionable insights throughout the energy ecosystem.

Utilities should start with a comprehensive strategy, supported and directed by C-suite executives. They need urgency too, to move  beyond pilots where too often projects go to die, and quickly.

They should focus analytics tools on pain points, that if relieved in a meaningful way could produce operational and financial benefits. For instance, engineers at a large US-based investor-owned utility were able to apply analytics tools data pulled from meters and other sources to detect a significant number of customers stealing electricity.

The result has been the recovery of more than $16 million in revenue that otherwise would have been lost over the past year.

But utilities should not rest after a single project. They should encourage adoption of analytics throughout the organisation. Every functional group should be encouraged to look for ways to bring analytics to bear for valuable outcomes.

Luckily the way forward does not rest on utilities alone. Navigant Research believes analytics vendors have a responsibility to adapt their tools and processes to better align with utility clients’ needs.

The goal should be to simplify solutions that solve utility-specific problems, concentrating on outcomes utilities over technology hype.

At first glance, harnessing huge data sets with analytics can appear daunting. But as more devices connect and massive amounts of data flow among many systems within the grid and beyond, the use of cutting-edge analytics tools cannot remain on the sidelines or in a silo.

It should become an operational and strategic imperative if it isn’t already. The digital transformation of the utility business is well underway. It would be risky not to embrace analytics tools now and advance with them as they mature.