In Internet of Things

In the 13th PwC Annual Global Power & Utilities Survey, 94 percent of respondents predicted important changes or a complete transformation of the utility business model. Some in the industry have already created a name for this transformation: Utility 2.0.

The outlines of this new utility model are starting to emerge. A recent Utility Dive story contains interesting charts showing economic growth decoupling from energy demand. In other words, it’s now possible to grow the economy without adding to the existing energy supply. Some of this comes from improved energy efficiency, and some from a switch to less energy-intensive industries and processes.

At the same time, distributed, renewable energy sources such as residential solar panels are replacing energy acquired from the utility.

The combination of lower energy demand and increased distributed energy source results in stagnant or negative load growth for utilities. This is a problem for these geographically limited monopolies who have historically based their business model selling kilowatt hours of energy to users.

To compound matters, the Internet of Things continues to infiltrate many corners of our society with digital energy-related devices such as smart meters and smart thermostats that increase the amount of data and communications traffic utilities handle.

The end result of all this transformation is that the energy distribution network is becoming much more dynamic. It used to be a one-way flow of power from the utility to the consumer. Now, it’s a bi-directional flow of energy, communications, and data between utilities, consumers, service providers and others.

Managing more variability in demand and production, more data and more communications related to a fundamental commodity such as energy requires sophisticated real-time analytics like those provided by situational intelligence applications.

Leading global utilities such as E.ON, Ergon, RWE, and Sacramento Municipal Utility District are deploying these applications to balance supply and demand, detect distribution anomalies in real time, make the most of existing assets and limited capital budgets, and provide higher quality service to customers.

Utilities are a large and fundamental portion of the modern economy, and have been for more than a century. They may not change as rapidly as other core industries such as telecommunications or publishing, but their transformation will be just as disruptive. Situational intelligence helps ease the way to Utility 2.0.

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