The century old linear model of electrification is being challenged and tested thanks to the far-reaching digital transformation redefining the rules of power and utilities.
By undergoing and embracing a digital transformation, companies – regardless of sector – can apply unpreceded insight, new capabilities, innovative business models and lucrative opportunities.
Future figures speak for themselves. In 2020, the globe will be inhabited by 5 billion internet users, according to Dospeedtest. In 2030, there will be 3 trillion IP-devices and in 2040 around 40 million electric cars will be on our streets, according to GE Estimate. These statistics represent an unprecedented challenge to the way the energy sector operates, both currently and long into the future.
At its premiere Industrial Internet event, Minds + Machines Europe – which took place in Berlin this week, GE Digital presented a tantalising glimpse at how the ‘Electricity Value Network’ model may look like in the near future.
The model showed a digitally and physically connected ecosystem comprised of power plants, microgrids, renewables, so-called ‘prosumers’, blockchain technologies, commercial and residential buildings, and more.
GE Power’s Baris Arikan explained to The Manufacturer: “As the electrification in the beginning of the 20th century was a must, the digital transformation is a must for every company these days.”
Currently, just 2% of the available data is being collected through Internet of Things (IoT) technologies and analysed to in the cloud. The future challenge will be to make use of the other 98% in order to create a smarter energy grid and a more environmentally friendly ecosystem, Arikan noted.
According to GE, there are 10 digital trends which define the current revolution and will determine the future of the world’s power and utilities sector.
- Impact of renewables and distributed energy systems (DER)
As more utility-scale wind and solar reach grid parity, the industry must aggressively adopt digital technology to become more efficient, flexible and compliant with environmental regulation.
- Artificial Intelligence (AI)
We will see a growing number of innovative applications of AI for the energy industry, from autonomous drones capable of inspecting and analysing remote transmission assets to predicting equipment problems that prevent unplanned downtime.
- Disruptive cyberattacks
Escalating cyberattacks, together with the increase in number of IP-enabled Edge-connected devices, will necessitate adoption of even more robust and extensive cyber security solutions.
- Multi-directional is the new grid
The future will increasingly be defined by digitally-enabled, intelligent grid technology, multi-directional power flows and higher quality power.
- The prosumer wave
Prosumers are starting to shape the power industry in transformative ways, requiring energy providers to use analytics and digital platforms to forecast usage, predict and manage two-way grid flows and deliver well-designed mobile customer experiences.
- CXO roles transformation
“CIOs are playing an increasingly central role in both OT and IT as utilities are undergoing digital transformation by leveraging IoT to integrate people, business and things,” according to Gartner. New chief digital officer (CDO) and chief transformational officer (CTO) roles are also driving digitalisation.
- Cloud + Edge is the next imperative
Cloud + Edge provides powerful, step-function advantages over existing IT/OT infrastructures, including greater speed, end-to-end security, lower costs, better performance, reliability, ability to scale and global visibility across geographies and assets.
- The talent challenge
Digitalisation, mobile, wearable devices and analytics will increase the productivity of energy workers while capturing and augmenting the knowledge of rapidly retiring networks.
- The platform economy
The power industry will increasingly be defined by digital platforms that developers and companies use to scale collaboration, rapidly build capacities that address a huge number of challenges and drive new value creation.
- New business models
Power and utility companies are increasingly using digitalisation to change their business models to compete in a rapidly changing power market driven by distributed generation, renewables, smart grids, storage, digitalisation, non -traditional competitors and prosumers.