Topic: Innovation and disruption are transforming utilities

The utilities are being forced to change the way they work in order to meet new challenges such as climate change and population growth, and meet ever more stringent regulatory targets. Innovation and the use of disruptive technologies are some of the ways the new breed of utilities are evolving.

Utilities are under Darwinian pressures to adapt or die. A new world order is emerging in which the industry must become more flexible, more transparent and more agile, or become the fall guy for failed decarbonisation efforts and frustrated consumer wants.

While such failings may not result in dramatic company collapses, they could certainly lead to the sidelining and marginalisation of traditional infrastructure providers and retailers. As new technologies rise to maturity, the door is opening for “asset light” intermediaries to make an appearance, and for companies to elbow their way into the value stack at the customer interface and in the system balancing process.

Utilities – of all kinds – must decide if they want to contest their traditional dominance in these areas.

For those that do, the ability to transform their business models, cultures and skills sets, is paramount. They must also ensure that this transformation is backed by shareholders who understand the direction of travel in the utilities industry, and have an appetite for it.

This challenge of business transformation is a many faceted beast, which interplays with major industry conundrums – like the status of trust in utilities, the role of policy and regulation in a privatised sector, and the extent to which competition can be applied in the delivery of essential services with social equity.

There’s no doubt, however, that the more tangible force of technology is fundamental too. The journey towards creating digital utilities has begun, encompassing distributed and low-carbon energy sources, smart home technologies, IT backed by powerful cognitive computing, and intelligent assets.

Utilities must innovate to absorb these technologies into their businesses and to apply them in novel ways, as well as to create system and customer value.

At Utility Week Live 2017, the challenge of utility business transformation lay at the core of seminar and conference content. The following pages review some of the main lessons learnt by delegates looking to play a part in this sector’s disrupted future.

To download a pdf of full article as if appeared in Utility Week, click here.