Shining a Light on utility trends in Europe
Four years ago, the landmark Paris Climate Change Agreement was reached. Fifty-five countries agreed to “combat climate change and to accelerate and intensify the actions and investments needed for a sustainable low carbon future.”
Change is hard, and of course the agreement has had its own recent challenges, but it was interesting to see how these values were very much in focus at European Utility Week in Paris. In the opening keynote presentations, many of the speakers addressed the urgency for the Energy Transition, reflecting the industry’s awareness that change is not only here, it needs to accelerate.
Today, there are numerous challenges for the sector. In the keynote panel discussion, participants identified many, including infrastructure issues, growing complexity, affordability, cooperation from players within the industry and the increasing volumes of data utilities and their employees are now managing.
The city of Paris was a pioneer both of street lighting and new ideas; hence its nickname ‘The City of Light’. As the world’s energy community gathered in the city, will their discussions lead to the innovative ideas that will keep all our cities well lit and powered in a sustainable way for generations to come?
Let’s shed some light on the key themes under discussion at EUW 19 and the Greenbird stand.
The hottest trends in the European energy sector
Thorsten Heller, the CEO of Greenbird discusses the hottest trends in the energy sector and the most interesting talking points at European Utility Week and POWERGEN Europe. Heller says "Blockchain is a solution looking for a problem" and is no longer a trending topic. He also discusses the innovations he thinks will change the energy game in the next few years.
1. Utilities are shifting to a platformed business model
Many of the visitors to our stand were keen to discuss this topic. Today, we are seeing twin forces of technology and data transforming the utilities sector. As McKinsey points out, “For tech to be a real driver of innovation and growth, IT needs to reorganise itself around flexible and independent platforms”
By using this model, ‘native’ tech companies use an agile approach and continuously innovate. It is also a model that established utilities must use to succeed in a rapidly changing energy landscape. In fact, we believe that the successful utility of the future will be a platformed utility.
An organisation may be running several different platforms with a different focus. Platforms may have an operational focus, for example utilities sharing smart grid data or controlling the grid in a shared, common central control room. Others may be customer focused or focus on a specialised area, such as the energy efficient management of a building or cluster of buildings. The common factor is the ability to integrate data, connect to enterprise applications and apply new technologies such as Artificial Intelligence (AI).
The key ingredient for platforms is data and data is something that utilities have in abundance. By using a platform approach, utilities can put their data to work, gather insights and innovate rapidly.
The utility as the platform for the Smart Cities of the future, one of the great benefits of the platformed approach is that the model can be scaled. We envisage utilities being the platforms for entire Smart Cities in the future. Some of the opportunities for utilities in developing Smart Cities are outlined here.
The idea of the Smart City is gaining momentum throughout the world. Urban communities understand the benefits a Smart City approach can bring for greater sustainability and improvements to the lives of their citizens. While many cities are trialling projects, these often exist in silos. Utilities are already experts in their local infrastructure. They are well placed to provide the integrating platform for energy, street lighting, electric vehicle charging, waste management, transport and other services and critical infrastructure of tomorrow’s Smart Cities.
A successful platformed approach rests on effective integration of data flows.
2. The utility as a data organisation
The opening keynote panel discussion identified data as a major challenge for the industry. As the panellists noted, utilities are huge data operators. By 2025, it’s estimated that 463 exabytes of data will be created each day globally.
Utilities are already data rich organisations. This stream of data is likely to become a deluge as grids and cities follow meters in becoming smart. The data that is being used by utilities is like an iceberg, with only a very small proportion being visible and utilised. The vast majority is ‘dark data’, hidden and inaccessible. The difference now? Utilities are aware of the power of the resource they have.
Managing the data deluge
The data only becomes truly valuable when it can be used to develop insights. The challenge is how we manage the sheer quantity of data available to utilities. This is where technology such as AI and advanced data analytics come in, but they can only be used effectively if data is ‘clean’ and data flows are integrated.
The panellists in the opening keynote panel discussion noted that the only way for utilities to meet the challenge from the deluge of data is to team up with startups and experts in new technologies such as AI and Machine Learning. Once again, we come back to the necessity for utilities to take a platformed approach.
It is not only with startups that utilities must collaborate. This approach is necessary between all participants in the industry so we can make the transition to a decarbonised future.
3. A collaborative energy sector
2019 has seen protests around the globe calling for rapid decarbonisation. The energy sector has taken note. While the industry has been working towards the energy transition for several years, there is now a new urgency.
As the sector searches for ways to accelerate the transition, we are seeing a shift in attitude from competition to collaboration.
A Sharing Economy for Energy Data
An idea that several people were discussing at our EUW 19 stand was the need for a sharing economy for energy data and energy insight applications. This is especially important as utilities shift to a platformed model. As data flows are integrated from Distributed Energy Resources (DERs), Smart Meters, Smart Grids, Electric Vehicle (EV) charging stations and even other utilities, all participants in the energy sector must take this new collaborative approach. Sharing data and increasing the data flows will help everyone in the energy ecosystem to increase innovation and accelerate the energy transition.
While the idea of data sharing is gaining traction, this brings its own challenges around data privacy and GDPR compliance. All organisations in the industry will have to comply with new anonymisation and randomisation requirements.
Customer collaboration for a decarbonised future
It is not only with other companies and organisations that utilities must collaborate. They must also collaborate with their customers. Customers are demanding change in the energy sector. Utilities must become more customer focused and use the data they have to provide the services that people want. For example, Catapult has just completed a project involving customers in a low carbon heating experiment, offering ‘Heating as a Service’.
Using their data and becoming platformed puts utilities on the path to becoming agile, innovative, customer-focused organisations. However, the speed of innovation and reactivity to consumer demands must increase.
4. The rise of real time
IRENA’s Director General, Francesco la Camera pointed out in his keynote session, that up until now, the key driver in the energy transition has been subsidies. Now there is a new driver – the market. And the market demands fast response times. There is a push towards data that is in real time to provide flexibility, energy efficiencies and improved service.
IDC predicts that in 2025 nearly 30% of the world’s data will need real-time processing as the role of edge computing continues to grow. In the utilities sector, smart technologies are gathering an abundance of real-time data from a variety of sources.
Whether this data brings new customer services via smart phone apps or helps utilities to see potential interruptions to supply, its potential is huge. However, the challenge is how to bring real-time visibility so this data can be leveraged.
Critical to real-time data is integration. Not only does IT have to be integrated across the value chain, operational technology must be integrated with IT. Creating real time data flows is the first step to creating a smart grid.
5. Technology as an enabler
New technologies often arrive with massive amounts of hype and it’s not always apparent what their business value will be. We noticed a more practical approach to technology at EUW 19. A move to apply new technologies to solve real business problems.
One of the technologies we heard people discussing is the use of Digital Twins. We think this technology promises real benefits to utilities. A twin of the network gives utilities a safe space to experiment and trial new technologies without impacting the grid or affecting the end user.
AI and Machine Learning have enormous potential for adding value to utilities’ data and for enabling the real-time processing of information from smart meters. These technologies are dependent on both the integration of data flows and on using Cloud Technology.
We are seeing a continuing move towards a decentralised energy system with much of the innovation in the sector coming from the grid edge. Edge Computing will give utilities better insights, for example of Microgrids, and will help to deliver the real-time insights that are becoming increasingly demanded.
These emerging trends highlight the many challenges today’s energy sector is facing. However, we were struck by the sheer number of utilities we spoke to who are meeting these trends head on. These utilities are already researching and embarking on projects that will prepare the industry for the changes ahead.
We think we’re in for an exciting 2020.
We hope you are as inspired as we are from these market insights and experiences happening in Europe this year. If you are interested in learning more about Utilihive, the digital integration hub that has earned 'Elite' recognition for data analytics you can find more information on our website or contact us to set up a personal meeting and demonstration.
Join us at DISTRIGUTECH – 28-30 January 2020 – in San Antonio TX. We are super excited to be part of the industry’s leading annual transmission and distribution event and our debut in North America.