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5 Obstacles to Utility Digital Adoption

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Karen Marcus's picture
Freelance Researcher and Writer Final Draft Communications, LLC

In addition to serving as an Energy Central Community Manager, Karen Marcus has nearly 25 years of experience as a content developer within the energy and technology industries. She has worked...

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leaders understand the need to upgrade technology for a wide range of applications, including DER integration, smart grid adoption, virtual power plant (VPP) development, advanced data analysis, improved customer experience (CX), EV expansion, and more. But utilities also face many obstacles to implementing digital upgrades, and even more to embarking on digital transformations.

These efforts require funding, advanced skills on the part of employees, and the ability to decide and act quickly, all of which utilities might not have. And these challenges don’t even take into account the disruption caused by the ongoing COVID-19 pandemic which has created the need to focus on other priorities. Let’s take a look at some of the most challenging obstacles utilities face as they recognize the need for greater digital adoption.

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  1. Digital integration is hard.

Even under the best of circumstances, with plenty of funding and a fully trained staff, digital integration is complicated and time-consuming. Beyond the technical challenges, utilities must contend with the need to implement change management procedures among end users. This process takes additional time and effort, and some employees may ultimately not be able to adapt, creating the need for additional effort toward hiring new team members.

  1. Privacy is an issue.

AMI data has the potential to offer utilities with a large amount of data that can be used to improve digital acceleration, sustainability, and customer care. Considering the potential for more streamlined processes, ability to reach sustainability goals, and higher customer satisfaction, this data is highly valuable. Yet, many utilities lack the skills to take full advantage of it. Further, many are unwilling to, given customer concerns about privacy — that is, worry about utilities knowing too much about their personal habits — and a lack of direction from regulators who have yet to create rules on this issue.

  1. Speed is a challenge.

A recent EY report, titled If tech powers the future, who powers the tech?, states “When asked about the factors holding them back from addressing the changes they need to make, 52% say the speed at which their organization can move is a major challenge to digital technology adoption.” Furthermore, “94% reported that the speed at which their organization can move is a challenge to both technology adoption and reskilling.”

  1. Skills are scarce.

The reskilling mentioned above is needed because of the scarcity of people able to run the technology needed to bring utilities fully into the 21st century. The EY report calls out this issue plainly, stating, “89% report having too few workers with the right skills as a challenge to digital technology adoption. For example, the gap in the workforce’s vehicle-to-grid and virtual reality skills is particularly notable, with 48% of respondents saying their workforce lacks skills in these emerging technologies.”

  1. Costs are high.

Costs of both technology and training remain high. Utilities may have other commitments that take precedence, especially during the pandemic and as extreme weather events require more resources. Even those who support using funds for digital advancement acknowledge the investment may not have a straightforward result. In a recent article, ­McKinsey states, “Businesses should devote a big block of funds that covers a long time and gives digital efforts room to zigzag toward transformational change.”

What obstacles has your utility faced in digital adoption? And how have you overcome them? Please share in the comments.

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