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The Digital Transformation of the Energy Industry

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Nathan  Sykes's picture
Founder Finding an Outlet

I'm a writer first and a techie second, though sometimes those can change. I'm Pittsburgh, PA and interested in the ways in which technology is impacting the ways we live and do business.

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  • Jan 14, 2019

This item is part of the Special Issue - 2019-01 - Predictions & Trends, click here for more

Technology is advancing at alarming speeds, with new and innovative solutions causing disruptions across the entire business and enterprise world. Just about every industry is experiencing some kind of digital revolution. In medical you have the adoption of IoT and smart health devices. In construction and development, you have 3D printing, and IoT is also making a splash. In hospitality and retail, there are mobile platforms such as mobile pay and app-based shopping. In entertainment, you have VR and AR opening up new worlds and realities. The list goes on and on.

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It was to be expected that the digital transformation would reach the energy industry as well. Power companies are now exploring many new opportunities available to them, from renewable energy to advanced data analytics. This development has also given birth to an entirely new subset of applications. Distributed generation via renewable sources, for example, is now possible thanks to big data and real-time analysis. Power companies can manage energy distribution to meet demands faster and more efficiently than ever.

What Does This Change Mean for the Industry?

Disruptive technologies can be both good and bad, however, so it begs the question: What does a digital transformation actually mean for the bulk of the industry?

Ultimately, many of the digital technologies and platforms will bring sweeping improvements. The distributed generation example shows how more robust data collection and assessment strategies will help manage energy consumption. Data collection can also help with energy storage applications, allowing its generation to be dampened when demand is low while also storing excess for when it ramps back up.

But even digital changes in the back office will lead to innovations in marketing and customer relations. Power companies and energy providers won’t just be collecting data and information about the power systems themselves, but also about their customers and even competition.

​​​​​​The True Value of Digital Comes From More Reliable Equipment

A combination of IoT sensors, digital technologies and artificial intelligence have made it possible to listen to “the voice of the power-producing plant.” Essentially, the configuration allows for more oversight and control over plants — and equipment like energy turbines — by sorting through a variety of real-time performance data. Said hardware can be kept in good condition through preventative maintenance and even made more efficient through nuanced improvements — all of which stem from data-related insights.

Turbines can be remotely monitored with similar technologies. They can even be made to operate autonomously, like the 570MW plant from Mitsubishi Heavy Industries Group. Even better, field service and maintenance improvements mean faster repairs, preventative measures to keep equipment operational and more information about what’s wrong. Collectively, it means that the act of keeping assets and equipment running is bolstered — an element of modern energy generation that has the greatest cost in overheads. PPL Electric has cited a 38 percent improvement in service reliability thanks to stronger analytics tools.

And all of this comes at a time when regulatory and pricing demands are changing considerably. Digital regulations especially will become more and more important as companies move toward data-driven entities. It’s a different game altogether when you start handling sensitive customer data and information beyond basic details. Cybersecurity is also important as more grids are brought online and closer to the world of cyber-attacks, malware and data breaches. Imagine an entire grid being taken down during the busiest of seasons due to a particularly nasty vulnerability or security breach.

Outlying technologies — ones that are just as innovative — include blockchain, distributed energy resources and self-generated energy, smart contracts and digital twin tech.

The Transformation Is Ongoing

To realize much of its potential, the entire utility, and energy industry must continue to transform operations and strive for innovation. It’s not just about adopting many of the technologies discussed here — it’s also about how they impact operations, customer relations, and even future dealings.

For instance, once something like a robust data analytics platform is in place within a plant — one armed with all the necessary sensors and devices — the real work begins. Providers must consistently assess the data coming in to look for insights and improvements, and it’s a never-ending process. More importantly, that’s just a small portion of what’s coming with the widespread digitization of the industry.

Luckily, there are also tools in place to help streamline such operations like AI and machine learning which can handle a lot of the data processing, ultimately extracting usable insights, patterns and trends.

It just goes to show how dynamic a digital transformation is with its many moving parts — not unlike the conventional operation of a power plant, which works collectively to produce usable energy for surrounding communities.

Nathan  Sykes's picture
Thank Nathan for the Post!
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Mark Fernandez's picture
Mark Fernandez on Oct 5, 2021

Thanks Nathan for this wonderful article.

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