The value chain and the business model of the utility industry are subject to a significant transformation, which is driven by the phenomenon of deregulation, decarbonised energy generation, decentralisation and digitisation.
By Holger Schweinfurth, SAP SE
In contrast to the first transformation drivers, digitisation is not a change caused by the changes in the utilities industry itself. Rather, it is the technical instrument of making the mentioned revolutions possible in the first place. With the extent and experience in the use of digitisation, the intelligence of every market-participating utility company as well as the connected consumers increases to master the complexity associated with the first transformations in a safe, economic and environmentally friendly manner. The pressure applied by legislation and society to implement the transformations is forcing all market participants to practise digitisation.
The key to mastering the described transformation is to underlay the energy system of a market with a digital information network that not only realistically reflects the current situation of the energy network (feed-in transmission- distribution-consumption) with all the necessary physical and commercial parameters but also – with decreasing reliability – short, medium and long term forecast. Every market participant in his market role that has arisen from deregulation must make his role-specific contribution to the creation and permanent maintenance of this information network. This also includes making your data available to other market participants permanently and promptly in a legally or internally binding framework and time rhythm.
This transactional data is consistently represented in the technical infrastructure (SCADA, NMS etc.), and in the business process execution increasingly by equidistant or non-equidistant time series. Anyone who analyses the technical and commercial processes in the utilities’ value chain, taking future requirements into account, realises that the editing and processing of such time series is increasingly needed everywhere. In the utility industry, solutions for processing energy- and water-related time series are traditionally named energy data management systems (EDM).
The availability and the exchange of energy and water data has already been emphasised above. For several years, leading companies from all industries have been relying on cloud technologies as they understand that challenges such as improved teamwork or the use of a wide variety of data for business decisions can best be mastered through cloud technologies.
This trend towards the enlarged use of the cloud will continue and cloud services will become increasingly important for digital transformation. The spread and the pace of innovation will continue to increase sharply and penetrate companies of all sizes as well as all market roles and regions. In the utility industry, an initial adaptation of cloud-based line-of-business (LOB) solutions for, inter alia, human resources or the procurement of goods and services could be observed. However, we also see a growing popularity of cloud applications for the vertical industry-specific meter-to-cash process.
In line with all the above developments on transformation drivers and the need for a cloud-based solution managing all energy and water data, SAP concluded to build a new generation of energy data management: SAP Cloud for Energy. This solution is purpose-built to manage and analyse big metering data. It is based on the open and global CIM-industry standard and thus easily integrates to upstream head-end and mediation systems and downstream applications like rating and billing. It automates the entire metering data life cycle and includes industry-relevant process support with embedded analytical skills that make it possible to better understand and effectively use large amounts of collected energy and water data. Since these data and processes are distributed across the entire value chain, SAP Cloud for Energy is required overarching and can support all market roles of a utility company.
With this ability and the capacity to be easily integrated into established business processes, SAP Cloud for Energy can be a tool for utility companies with which they can consolidate and expand their position in the market and encompass new business opportunities.
About the author: Holger Schweinfurth works as a senior director within the Industry Business Unit (IBU) Utilities at SAP SE. In this capacity, he guides global insights into utilities’ market trends and opportunities with a specific focus on the overall roadmap of SAP in the utilities industry and the energy transformation. Prior to his roles in SAP, Holger used to be an SAP Consultant at PricewaterhouseCoopers (PwC). He graduated from the Universities of Heidelberg and Leeds (UK) with a master’s degree in Economics and International Business Management.