Research forecasts cumulative international spending on power energy data analytics to top $20 billion over the following seven years, with a yearly invest of $10.2 billion globally by 2030. The article would also walk you through role of information technology in Utility Industry. The utility industry is one of the most important industries in our society today. The industry, often referred to as public utility, provides services such as gas, water& sanitation and electricity.
INTRODUCTION
The utility industry is one of the most important industries in our society today. The industry, often referred to as public utility, provides services such as gas, water& sanitation and electricity. These services are the core and some of the most important commodities and services needed in a nation. For instance, electricity is needed to drive many activities in a nation. Without electricity, many manufacturing, industrial and domestic processes would crumble. The US is seen as one of the countries enjoying the most reliable electrical energy in the world. However, there are some challenges affecting the global utility industry which needs to be examined and appraised. These range from generation asset management along the path, the need for a smart grid and new energy alternatives.
As business models changes, increase in competition and expansion into new markets, the global utility industry is faced with enormous challenges and mountains to surmount. Companies therefore need to leverage cost effective measures of production to achieve success in the utility industry. Information technology becomes very pivotal in solving major utility problems faced in the sector.
For instance, in the Black & Veatch’s first water utility survey, much of the problems facing the water utility industry were outlined. Most of these problems have to do with financial challenges, sustainability and asset management. Financial issues and every other issue driving costs affect this industry tremendously. This can be seen in aging water and sewer infrastructures, managing capital costs, funding or availability of capitals, treatment technology, energy costs, information technology, aging workforces, chemical costs and so forth. It has been observed that since economic downturn, the gap between system needs and funding has continued to expand and thereby putting the utility industry to risk.
Electric power supply is a universal industry and other utilities therefore stand for a significant commercial industry. In the United States, which represents the globe's biggest utility market, there are approximately 1,200 firms engaged in energy distribution and transmission, with overall yearly incomes of USD$ 465 billion. Recent price quotes of the size of the worldwide market for energy data analytics vary from USD$ 3.8 billion by 2020.
THE CRITICAL NATURE OF THE UTILITY INDUSTRY
Owing to the intense demands of utility, it is quite obvious that no country of the world can live or do without them. The level of development in each nation of the world is tied to electricity as it drives major industry activities. Electricity is the cheapest cost of energy and therefore it should be made adequate in order to reduce the manufacturing and production costs of industries.
The total population of the world increases on a daily basis. According to GeoHive population estimation, the current population of the world is about 7 billion. However, it is estimated that the world will clock 10 billion by 2020. This makes it imperative to meet the energy demands and utility needs in the world. It is also estimated that the consumption of utility resources would increase by about 50 percent in 2020.
High end technologies have to be employed towards solving these great challenges facing the utility industry and therefore provide the utility resources needed by the world. These challenges range from smart meters and cyber-attacks to rooftop solar and energy storage. Most electricity grids have remained unchanged for as long as 100 years and therefore they are facing challenges. This brings a whole lot of challenges including evolving business models, the adaptation of regulatory models and also changes in customer expectations.
Furthermore, the industry must therefore strive to increase its stakeholder value and also maintain its customers. In the electric utility industry, it is important to eliminate power outages as much as possible. In some regions of the world, power outage is a regular occurrence and therefore if the global utility industry must maintain value and increase, power outage has to be eliminated. In addition, various industrial expansions and operations require long term energy usage. The utility industry must therefore provide this long term energy demands for driving operations. There is need to improve existing energy operations in order to effectively steer future growth. As a matter of fact, the utility industry depends greatly on information technology to effectively achieve its aim and drive both the existing and the future energy operations. Astounding success in the utility industry would not be possible without the information technology and that is why advancement in information technology is very critical.
Additionally, to exceptionally breakthrough, the industry needs to handle issues relating to financial management, sustainability and asset management. Energy cost is another important issue to consider in the operational processes of the utility industry. Energy costs can account for as much as 30% of most of the operating budgets of the utility industry. Data quality and risk management assessment are important parameters to consider with respect to asset management in the utility industry. When it comes to the implementation of asset management programs in the water utility industry in most parts of the world, there is great disparity among the utilities serving smaller populations versus larger utilities. Size is not a barrier to the development of asset management programs as well as the efficient measurement of the services.
WATER AND SANITATION DEMAND
A compound annual growth rate (CAGR) of 4.2% was recorded in the global water utilities market between 2008 and 2012. This amounted to the revenue of $722.5 billion in 2012. Also, there was an increase in market consumption volume between 2008 and 2012 with a 1% compound annual growth rate (CAGR) which culminated to 2907.6 billion cubic meters in 2012.
Furthermore, it is expected that the market performance would follow the above stated model.Prediction shows that the CAGR between the duration of 2013 and 2020 would be 4.3%. This will probably cause a surge in the market value culminating to $3680 billion by the end of 2020. A research conducted in a Public Sector University of Malaysia forecasted that by 2020, water consumption and wastewater would amount to 3680 and 2944 billion cubic meter. This is obviously higher that the figure obtainable in 2013 by 20 percent.
Figure1: Projected global consumption of water and waste water. (Enclosed Below)
Energy Demand Forecasts and Solution
World electricity need is forecasted to improve at an average annual rate of 2 % over the outlook duration. This is a little less than the growth price of 2.2 % each annum experienced from 1971 to 1995. In absolute terms, the yearly global need for power rises from 8341 Mtoe (Million tons of oil equivalents) in 1995 to 13,749 Mtoe in 2020. These figures do not feature biomass power usage in developing countries. During this period it is expected that nonrenewable fuel sources will remain to control the energy mix. Ninety-five percent of the extra electricity need between 1995 and 2020 will be fulfilled by nonrenewable fuel sources. Oil continuously controls world energy consumption, although its share declines from 10 % in 1995 to 8 % by the end of the outlook period. Many of the rises in oil demand will stem from added demand for transport services.
According to another recent research forecasts cumulative international spending on power energy data analytics to top $20 billion over the following seven years, with a yearly invest of $3.8 billion globally by 2020.
Need for gas demands a lot faster than that for oil or solid fuels, specifically in the OECD regions. Where pipelines already existing, or can be constructed, organic gas known as biomass is the recommended gas for lots of applications, specifically for new power stations. Gas consumption nearly folds the outlook duration, increasing from 1810 Mtoe in 1995 to 3468 Mtoe by 2020. The share of fossil fuels in the key energy mix will certainly stay mainly the same over the forecast period. Growth is much faster in the developing regions, especially in China and South Asia which are anticipated to establish further their indigenous supplies of coal.
Globe nuclear power stabilizes and in the OECD, some new atomic plants are anticipated to be constructed during the outlook period. At the very same time, several plants will get to completion of their operational life leading to a general decline of nuclear power in the region. Outside the OECD, development might be greater, with nuclear energy increasing in Asia and in the developing economies.
Hydro power is anticipated to increase at a typical rate of 2 % each annum. Within the OECD, the majority of the sites have actually already been made use of and consequently development is anticipated to be limited, at 0.7 % each annum. Establishing regions enhanced with hydro sources will certainly improve the usage of this power type to create even more electric energy. China and East Asia are the regions where development in hydropower is anticipated to be the greatest.
Using various other renewable power resources increase continuously, however continues to be at reduced degrees. The power generation industry will be the key consumer of this kind of electricity. Among the various types of renewable resource (wind, geothermal, solar, tidal), generation from wind power is anticipated to make the biggest supplement.
Table-2 below, Illustrates the contribution of different fuel sources for power generation and utility sectors during 1995-2020.
ROLE OF INFORMATION TECHNOLOGY IN FUTURE CHALLENGES TO UTILITY INDUSTRY
The utility industry is faced with lots of issues and challenges which require the high end information technology to solve.
In the National Town Meeting on Demand Response and Smart Grid in Washington, DC which took place between July 9 and July 11, 2013 at the Ronald Reagan Building and International Trade Center, some of the greatest issues facing the utility industry in our world today and consequently the expected challenges in the future were discussed.
The agglomeration of smart grid technology providers, regulators and system operators pointed out key issues that needed to be addressed in the industry which affects various operation processes and activities. The issues are as follows:
Cyber-attacks
Cyber-attacks have made clouds unattractive and also to lose its trust with utility executives. These are ubiquitous and therefore needs to be appropriately monitored and addressed. 40 percent of the hacking attacks in the United States of America are on electric grid.
In order to study measures to handle the cyber-attacks, the North American Electric Reliability Council (NERC) launched a 36 hour stimulated attack on the power grid which included 65 utilities and 8 transmission organizations, according to SmartGridNews.
Cyber-attacks must be tackled in the electric utility as well as other utility industries. Using high end technologies such as SAP, Oracle and so forth, these can be really monitored and effectiveness can be ensured in the process.
Customer Expectations
Personalization is an important issue to consider with respect to utility services. It is important to move beyond the idea of class averages and uniform pricing in the utility industry. Differentiated service models should be brought into the services and this involves giving customers options. This means that provision ought to be made for giving incentives or paying customers for the services they did and even making provision for them to save money. This implies that efficient sales models should be used by different utility providers.
Demand response
Demand response participation is hugely important, however, very little of the masses dare participate in it. In the United States only 5 percent of the population takes part in demand response in the utility industry. One of the biggest problems with demand response is perhaps the customer engagement. This involves getting customers to sign up. The utility industry in the US spends up to $350 million (half of the yearly residential demand response) on the customer incentives. This is a very huge cost and expense. As a matter of fact, if these incentives are rather channeled towards bill savings as per energy efficiency, success and remarkable improvement can be made in the utility industry.
Dynamic Pricing
Demand response is not a behavioral change. Customers need to be given tools to steer their response to dynamic pricing. Customers should be allowed to have a cheap way in which they can match their preferences for their various utility accessories. For instance, their thermostat should be able to determine the best prices that would suit their needs for comfort. Thus, automated systems that have the capacity of performing these tasks and functions should be created for customers. This can be achieved with ease than behavioral change. As a matter of fact, an integrated strategy for rate planning should be developed.
Smart Grid and Smart meters
The EU mandated that by 2018, 80 percent smart meters should be launched. The smart grid will make network operators’ live easier by changing how we do things. With better facilities, more functionality can be done in more effective and efficient way so as to ensure a better outcome.
HOW INFORMATION TECHNOLOGY CAN SOLVE PROBLEMS IN THE UTILITY INDUSTRY
The various challenges facing different sectors of the utility industry can be greatly addressed from the information technology perspective. Utility can effectively succeed in a marketplace plagued with these challenges by wielding the various IT tools and resources.
The Primavera solutions from Oracle are an invaluable tool in solving major problems in the utility sector. These are state of the art project portfolio management solutions needed for efficient driving of various operations in the industry. With the top notch utility solutions, the utility sector will be able to efficiently choose, plan and implement projects in the organizations and also ensure efficient execution of portfolios for different kinds of projects in the various sectors of the utility industry ranging from providing the needs for water utilities to power generation, transmission and distribution.
With the top notch Primavera solutions, efficient management of power outages can be ensured. They also give room for daily maintenance and capital expansion of different sizes of projects. The solution helps in achieving repeatable success by establishing best practices and methods. With the high end software solution, various issues in the utility industry can be addressed. Below is the list of some of the issues which the software provides solutions to.
Choosing the right investment in line with your specific goals
The high end technology helps you to identify the best projects to invest into with respect to the level of risks you can handle and in line with your objectives. To effectively expand into new market and maintain competitiveness, portfolio analysis and new business models are important. With platform, risks can be easily analyzed through project simulation. It gives room for accessing several models with ease in order to determine the possible impacts and outcomes they will have on your business.
Faster Reaction to Project Changes
With the platform, you will be able to access the latest project information at anywhere and anytime. The solutions provide the information needed to the right people and the right time to ensure data accuracy and reliability. As a matter of fact, it gives room to efficient decision making and helps to discover potential delays and create predictive plans to reduce losses.
Reduces the effects of shrinking labor Pool
To reduce the effect of shrinking labor pool, employee productivity has to be increased. This can be achieved through enhanced planning and improved allocation of resources. The Primavera solutions provide project intelligence platform which can be wielded to ensure increased organizational competence. It gives room for enterprise project management and assists new employees to understand the operational mechanism of the processes.
THE IMMENSE POWER OF PRIMAVERA SOLUTIONS
The Primavera project portfolio management software has been a flagship tool in providing the solutions to the problems in the global utility industry for a quarter century. Most of the top utilities in the world solely depend on the platform to manage outages as well as capital projects. The product lines are also needed to execute turnaround activities in some of the largest nuclear power plants.
Primavera solutions are top notch, easy to use and expandable and thus they can be used for all projects. The solutions can solve any project needs in different organizations and various phases of operations including engineering, capital, outages, procurement and maintenance. With the software, customers will be able to execute a solution right to them. It provides information to team members at real-time in order to enable them execute their projects with more effectiveness.
Effectiveness of Primavera Project Management
The Primavera P6 version role is important in Project Portfolio Management is the most potent, scalable and easy to use solutions we have today. With this high end tool, enterprises can efficiently manage their schedules to meet their deadlines and budgets as well as manage their resources and costs. It ensures that the best quality project execution and solution are delivered. It also incorporates web access for its users, extensive and easy to use functionalities, enhanced dashboard which ensure improved visibility.
Risk Analysis with Primavera Risk Analysis
Organizations can develop a perfect understanding and also efficiently plan their project portfolio with the Primavera Risk Analysis analytics solution. By calculating the possible completion times, modeling risks and analyzing the cost and the impact of mitigation scenario schedules, organizations can support project governance and financial planning.
Primavera for ERP Applications
With the Primavera for ERP applications, budget costs and schedules in user-friendly applications which easily integrate with Primavera project portfolio management solutions can be aligned with your ERP applications. The high end software solutions help enterprises to bring down project risks and ultimately meet deadlines. This is ensured by effective management and estimation of schedules, resources and costs.
Moreover, IT facilitates in the most up-to-date record, the Soft Grid which provides large Data & Utility Analysis for Smart Grid, forecasts grid operations analytics, the most substantial financial investment, with customer analytics. With the increase of big data, the capacity of smart grid has actually moved substantially from the initial objective of including a myriad of new instruments toward a total re-invention of the way utilities do business research. The spotlight will perform the data analytics software application that will permit energies to track, envisage and anticipate every minor function from grid to electricity consumption.
Steering development of the energy soft grid are data technologies, varying from open-source data administration systems like Hadoop , to massive parallel processing (MPP) big data appliances, to anticipating analytics, to the expense improvements and enhanced efficiency of backup data storage space and facilities layer.
Cloud computing offers access to virtual resources found anywhere, which could further improve efficiency and ROI however can lead to issues over information security and integrity (because Cloud-based shipment of IT infrastructure, platforms and software application). The financials aspects of cloud computer and as-a-service shipment are hotly contested and over time it may be more money-saving for a utility to develop its own information facility facilities, specifically for quite huge procedures.
Distribution sensors and smart meters enable to tackle "big information" from every corner of their areas, utilities have to look for out information analytics options qualified of managing this inbound data and recognizing the assurance of the smart grid
INFORMATION TECHNOLOGY PRODUCTS AND VENDORS
The lots of vendors providing different software’s and tools to meet the challenges faced by utility industry as illustrated in Table-3 enclosed below.
Conclusion
The various sectors of the utility industry depend on the software industry to meet their global challenges. Challenges facing the gas utility sector as well as other utility sectors include the need for green initiatives, changing energy demands, aging infrastructures, new smart grid technology, aging workforces, demanding regulations and pressures to reduce costs. The utility industry needs more efficient approaches for delivering safe, timely, reliable and sustainable services.
To achieve the required success in 2020, high end intelligent modeling tools and advanced information management systems ought to be used to enable increase efficiency in the various processes. These include the various asset life cycles including planning, designing, construction and operation phases. Various software industries such as SAP, Microsoft, Ericsson, Oracle, SAS and so forth provide the tools needed for utilities to create intelligence from new data sources and deliver solutions needed in the industry.
About the Author
Antonio Bhardwaj is a successful leader with over 28 years of expertise in building businesses. Antonio Bhardwaj is a board member at Global International Sellers. In addition, Antonio Bhardwaj works at Sierra Infosys, as an Executive Vice President.
Antonio Bhardwaj is an investor and International domain expert. Antonio Bhardwaj is published author of "Challenges and Solutions in an Upstream and Downstream Oil and Gas Operation- Sierra Infosys View", "Subject Matter Expert discuss role of Information Technology in Exponential Growth of Oil & Gas Industry in Next Two Decades" , "I am ready for the winter but I want a tablet computer for maximum $3.7 Million to review my business from any location.” - Oil & Utility Trends Save changesSave changes" & "Prominent blog discusses global trends in the Information Technology Industry today"
Antonio Bhardwaj has many publications on leadership, economy, exports, technology, energy.
Antonio Bhardwaj has been involved in two mergers & acquisitions, which has over the years given him a strategic edge in his successful career.
Antonio Bhardwaj is member of CIO forum, CIO Council, CMO council, CIO Summit, Texas Global CEO's
Serving family and community is most important to Antonio Bhardwaj \and he strongly believes in: " Commitment to serve others goes a long way in building
Antonio Bhardwaj is a member of highly distinguished professional associations, which are primarily open for people with distinctions such Dallas Petroleum Club, Crescent Club & Cosmos Club of DC.
Antonio Bhardwaj is a candidate for US Congress.
Antonio Bhardwaj
For US Congress
Executive Board Member
Global International Sellers
100 Highland Park Village,
Dallas, Texas 75205
P: 214 612 0000
e: cs@zz.us.com
w: http://www.antoniobhardwaj.com
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