New York, NY, USA — (METERING.COM) — March 19, 2007 – An increasing use of outsourcing for a range of operations and increasing reliance on technology, including smart meters and the smart grid, will occur over the next five to ten years, utility executives across the US and Canada believe.
This is among the findings of a new Platts/Capgemini study based on more than 100 interviews with chief executive officers, presidents and other senior level executives aimed at identifying current and future issues in the region’s electric and natural gas industry.
The majority of the utility executives believe that retail competition in the industry has not been successful. However, while most expect it to move forward in some form they do not expect the industry to totally deregulate in the future and nor is there likely to be a move back toward the vertically integrated utility model.
According to the study the most important issues facing the industry in North America today are regulation, with uncertainly surrounding the ability to recover investments and environmental compliance, infrastructure investment, against a background of ageing infrastructure and lack of transmission capacity, and managing commodity price fluctuations, particularly of natural gas.
The introduction of new technologies, including AMI, demand response and smart grid technologies, is also an important issue currently, as is the introduction of billing and outage and operations management systems.
Looking to the future the respondents believe that in the next five to ten years reliance on information management, workforce automation, and the risk management function will increase, with the ageing workforce and cyber security being key areas of concern.
There will also be increasing use of business outsourcing, particularly for billing, call centers and metering. However, functions such as outage management and distribution operations will remain utility managed.
Supporting this view the respondents say that over the next two years the most significantly increased resource allocations, compared with today, will be in AMI and other technologies as well as in information and risk management and workforce training.
Commenting on the findings Amin Bishara, Capgemini’s vice president global outsourcing utility sector, said the study verifies that top executives are becoming “laser-focused” on their core businesses and are considering outsourcing for their day-to-day operations.
“Utilities are just now growing comfortable with letting another organization manage its customers,” said Bishara. “Utility companies are also beginning to connect the dots between their need for the most robust information technology and the ability of their organization to manage all the risks they face.”