The utility sector: A major GIS market growth enabler


Global Market Insights looks at the factors driving the geographic information system (GIS) market and how the energy segment will contribute towards the market growth.

The research firm forecasts the GIS market to surpass a valuation of $$9 billion by 2024.

Touted to boast of a broad application scope spanning key business sectors, the global GIS market has surfaced as a fundamental entity representing profitability and operational efficiency over the past several years.

From conducting surveys and mapping activities for the energy segment to developing telematics and navigational solutions for transportation purpose, GIS services have become a basic necessity while undertaking new ventures or expanding territorial operations.

The prominent resources and data which companies acquire as well as manage using geographically-relevant information include demographics, workforce distribution, customer behavior and real-time asset monitoring.

Suitable GIS allows for more reliable analysis of this data to make critical business decisions, unlike complex legacy systems and previous data collection methods where small bits of important statistics could easily be overlooked. 

Development of modern hardware and software components, that can work with remote sensing technologies and spatial information-gathering objects, has picked up pace with the increased consumer demand for various services.

In recent years, with the surge in demand for energy and communication along with the need for more extensive and reliable energy infrastructure, the utility industry, including power, oil & gas and telecom, has rapidly adopted GIS to achieve significant business transformation and bring more efficiency into every day operations.

Managing the integration of wind and solar energy with modernised electricity grids to meet national sustainability goals has further induced the need for high-tech utility solutions.

Geographical data tracking has the potential to considerably improve the service capabilities of telecom companies as well, since mapping, mobile asset management and consumer data are crucial factors that influence major decisions.

Keeping an eye on investments like tools, people and communications, infrastructure through GIS data helps in timely equipment maintenance, while access to demographic information enables better handling of customer contracts.

Utility applications and the GIS market

Regardless of the type of utility services, GIS is essential to determine infrastructure requirements, forecast vulnerabilities using real-time data, prioritise repair-maintenance tasks as per geographic specifications and ensure interoperability of different business components. These features have increasingly become vital due to growing power consumption and stringent policies regarding utility rates and environmental control.

Planning and designing networks: Accounting for the largest share of investments made by a utility firm, networks form the core of business operations which need effective planning and design to avoid failure of services.

GIS-powered insights and decisions enable companies to not only design efficient networks to reach customers, but also save considerable cost incurred on engineering, development and supply chain services.

Referring to data submitted to the US Federal Energy Regulatory Committee, between 2015-2016 running one mile of natural gas pipeline cost around $$7.65 million per mile. This demonstrates the importance of building a robust network which is able to reach customers, allows for easy workflow management and tracking of resources.

GIS software are able to assist planners in developing critical utility networks like water and gas distribution, district energy grids, wastewater systems, among others using precise mapping technologies and data analytics.

Managing business assets: Utility services are by default asset-based and firms have always struggled to manage them due to the spread of physical networks over vast territories and in different weather conditions.

Although a large number of existing assets are difficult to monitor and maintain, the GIS industry can help in enhancing the management of new assets which are a part of a more decentralized, smart grids.

Duke Energy, for instance, has total assets of $133 billion and serves more than 7.4 million electric customers in the US.

The company is consistently expanding its solar energy initiatives and recently bid for a 680 MW project that would power almost 125,000 households at peak output.

Such efforts underscore the requirement of GIS and other smart technologies to manage and optimize physical assets of utility providers with the growing mix of renewables in the energy supply. 

Outage management: Power failures caused by weather events and faults in equipment could lead to millions in losses for utility providers as well as commercial operations in the area. Reportedly, eight major markets in the U.S. forfeit nearly $27 billion every year owing to power outages, with some businesses accruing bigger losses than others.

Today, utilities can avail the services of GIS providers to acquire mapping and data management abilities for enhancing outage management, by building a map that indicates physical assets and offering a graphic display of size and effect of events such as storms.

Continuous gathering of data can assist in forecasting when an outage could take place, possible location of the damage and anticipate which areas may get affected by weather. It also allows firms to dispatch a field crew even before an event occurs, enabling predictive maintenance. GIS also makes it easy for mobile workers to access the same information as those in the back offices, making operations more efficient.

Regulatory compliance: Most countries around the world have strict regulatory standards to be implemented during city planning activities or setting up of utility services like water supply, sewer flow gas pipelines and electricity lines.

Precise mapping and monitoring is needed to determine the delivery flow of utilities and predict service interruptions. In doing so, enormous amounts of data are collected regarding the area and GIS is a technology that is able to manage and analyze this data more effectively.         

Planners have to evaluate whether new infrastructure will comply with regulatory demands, which can be done using GIS-based data. Remarkably, GIS software could help create visual presentations of the environmental conditions in an area, helping to compare between current settings and estimated outcomes of proposed utility network design and development. In addition to helping meet regulatory demands, the GIS industry would also help utilities in creating strategies to make amenities and services more accessible and reliable.