While the energy industry is currently on a digital transformation journey, electric utilities are currently being faced with unique opportunities and challenges as the world becomes increasingly digital. As we move into the future, more data will be available to and required of utilities. As consumers connect to the grid with their electric vehicles, solar panels, and more, utilities will likely need to collect and utilize data across the entire grid, including at the individual consumer level.
Utilizing data at this scale will provide exciting opportunities for innovation and revenue growth. According to A.T. Kearney’s analysis, digital transformation has the potential to increase utility earnings by up to 4% per year in the short term, and the potential to increase utility earnings by more than 25% a year over present levels in the long term.
Source: A.T. Kearney
However, in order for utilities to capitalize on this potential, and succeed, they will need to develop a digital strategy and core competencies. Some of the core competencies that utilities will need to include in their strategy include the utilization of the Internet of Things (IoT), advanced analytics, artificial intelligence, and an ecosystem of technologies and employees that support the digital vision of the organization. Additionally, in developing and honing these capabilities, it will be essential for utilities to keep a close eye on three key forces that are currently transforming the industry - Market Dynamics, New Technologies, and Regulatory Frameworks (Kearney). Gartner notes similar dynamics that need to be monitored as CIOs develop their digitization strategy. These key forces will continue to evolve over time and utilities will need to have the agility to respond and react quickly.
Developing digital capabilities will ultimately help utilities with their agility, and their ability to react to market dynamics in real-time. Gartner notes that advanced analytics will be crucial in providing objective insights and predictions that will inform decision-making and the overall business strategy. In order to develop the necessary capabilities, utilities will need to make strategic, informed decisions about which portions of their digital ecosystem they should build or buy (Gartner 2021). Kearney’s research seconds this as an important piece of the digitization strategy.
“It is never too early for a utility to begin critically evaluating its suppliers’ digital skills and capabilities to determine if they fit the utility’s future digital vision” (A.T. Kearney)
Yes Energy is the leading nodal energy data provider in North America, and we have the Big Data solutions and industry expertise to support your digital transformation effort. If you’re not quite ready for a Big Data solution and are currently developing your utility’s digitization strategy and associated capabilities, we also have the stepping stones to get you where you want to go. If you’re looking for solutions that will scale with your automation, advanced analytics, and utilization of A.I. and IoT, we would love to be a part of your digital ecosystem, supporting you as you transition into the future. We offer an API, Cloud, and Data Lake solution, all developed to scale to your specific needs along your digital transformation journey.
In the long run, utilities that develop a digitization strategy that allows them to adapt to new market dynamics, energy technologies, and regulatory frameworks will excel in this rapidly changing environment. Those who do not develop a strategy and the necessary capabilities will be left behind, and are unlikely to be successful. What does your digital journey look like? We’d love to hear from you.