The decentralized utility is coming. Are you ready to make the shift?

Sharon Parker's picture
Senior Marketing Manager, IFS

Marketing communications manager with 15+ years' experience with workforce management/automation software specific to the energy and water utility industries.

  • Member since 2020
  • 7 items added with 9,251 views
  • Nov 29, 2021

To better manage grid operations, many utilities are turning to risk-based predictive asset maintenance and monitoring technologies.

The transition to decentralization is coming, whether utilities are fully prepared to make the shift or not. In order to better manage their grid operations, many utilities have turned to risk-based predictive asset maintenance and monitoring technologies, yet some utilities continue to rely on traditional scheduled, or reactive, asset management strategies, leaving a lot on the table. Compounding problems for those neglecting to be proactive are the increasing number of renewable energy sources and the rise of the “prosumer” relationship with customers, which makes asset management even more challenging for utilities already swamped by operational data, creating a lack in actionable intelligence.

IFS partnered with energy research firm Zpryme to survey more than 100 utilities to better understand this shifting landscape. The findings discuss how to move away from a break-fix model within an asset maintenance strategy and explores the changing dynamic between utilities and customers.

Key Findings

  • Building a proactive/preventative maintenance program (50%) is among the top three challenges for utilities when maintaining assets
  • 46% of utilities have implemented a predictive, risk-based asset maintenance program within the last few years
  • The top challenges of integrating a predictive asset maintenance program are software maturity or availability and sufficient budget (44%, respectively)
  • 33% of utilities have implemented or are currently implementing a home services program within the last three years for behind-the-meter assets

Framing the Problem

Utilities face a variety of challenges as they fight to keep the lights on for themselves and others. When asked about their top challenges, respondents said that upgrading infrastructure was by far the most pressing (65%), followed by the integration of new technologies with existing technologies (47%) and an aging workforce (46%).

Despite concerted efforts to modernize the grid, replacing infrastructure has proven difficult. Retrofitting existing infrastructure is costly, compounded with having to balance distributed assets and manage stranded assets. Considering the growing integration of renewables onto the grid as well, it’s no wonder utilities haven’t been able to fully modernize. Additionally, utilities are challenged by a workforce that is aging out, taking valuable skills and knowledge with them, which will make managing the grid as we know it very difficult moving forward.

Operationally, utilities recognize the need to implement new technologies and solutions to improve efficiency and overall performance, but the marriage of legacy systems with nascent ones has proved particularly challenging. The need to maintain regulatory compliance with a shifting policy landscape doesn’t help matters (35%), particularly when upgrading physical and digital infrastructure is costly and hard to get right. As part of the push to modernize and remain compliant, more and more utilities are turning to connected device solutions to better monitor and manage various aspects of their grids. Yet 21% of utilities say they’re struggling with implementing and managing risk-based asset maintenance and management programs, and 13% have indicated complications with access and sharing data, which is critical for utilities to be able to decentralize their operations and management.

Layering on the complications of a changing climate and the push for more sustainable sources of energy, and therefore more sustainable management of existing resources, utilities are hard-pressed to balance all of these complexities. Nearly a third of utilities say they have challenges around incorporating renewables onto their grid. This number is expected to increase as more customers take a proactive role in the generation of energy via renewables and is set to permanently alter the relationship between utilities and consumers.

Predictive Asset Maintenance

When managing and maintaining assets, utilities have issues with tracking asset performance data (51%), building a proactive/preventative maintenance program (50%), and tracking asset lifecycles from procurement to disposal (46%). Additionally, utilities are struggling to extract full return on investment (ROI) from each asset (37%) as well as accessing/integrating asset maintenance data (33%). In traditional asset management, utilities don’t have real-time visibility of their assets, meaning that they only know if there’s a failure when something goes wrong. This break-fix model can end up being more costly for utilities versus taking a more proactive approach via predictive maintenance solutions.

Utilities are stuck between a rock and a hard place, balancing operational and sustainability challenges and more. Between the difficulty in sourcing mature software, to integration within legacy systems, to accessing and sharing data, utilities are finding it difficult to justify investing in predictive, risk-based asset maintenance solutions. This is exacerbated by the climate-related effects on distributed assets and the increasing number of assets as renewable energy sources come onto the grid.

But the benefits of deploying a predictive asset maintenance program are unparalleled when it comes to the visibility of assets and the ability for the utility to fully actualize the ROI of each asset. Overall, utilities can expect to see improved system reliability and resilience, reduced outages and failures, along with reduced repair times and improved worker safety. This will be necessary, particularly in light of the rise of the prosumer and the expansion of the grid as we know it. The liability of external assets will increase burdens on the utility, especially when it comes to asset failures.

By deploying a comprehensive home services program, utilities can reduce the liability of and increase visibility of distributed energy resources (DERs) and improve customer satisfaction and experience.

Get your copy of the full Zpryme report, including their recommendations for the utility industry.

Watch the industry panel discuss the Zpryme report findings at the Energy Thought Summit.


Bob Meinetz's picture
Bob Meinetz on Nov 29, 2021

Sharon, when the website named came online in 2012, it predicted the end of utilities within three years ("dive" was originally meant to imply a death spiral; as it became clear utilities and centralized generation weren't going anywhere, it's been re-interpreted to imply the website offers a "dive" into interesting energy topics).

So your claim that "The transition to decentralization is coming, whether utilities are fully prepared to make the shift or not" rings a bell.

As long as customers need reliable energy that doesn't disappear after the sun goes down or the wind stops blowing, as long as some want to be able to replace clean, efficient utility generation with a few solar panels and their own diesel generators, the "energy transition" will remain little more than a marketing tool for utility consultants.

on Dec 8, 2021

Will Home services program not limit the utilities to enhance their supply side of the business? This may be only true for suppliers. But if we look at utities who are in the space of transmission and distribution, for them even managing the field assets would be more vital. Because, grid operations can be impacted by the performance of the field assets while if a behind the Meter asset goes down, it may impact a customer and still may escape a larger outage. What's your take on this?

Matt Chester's picture
Matt Chester on Dec 8, 2021

Because, grid operations can be impacted by the performance of the field assets while if a behind the Meter asset goes down, it may impact a customer and still may escape a larger outage

This is an interesting point-- but I also wonder whether it creates more points of potential failure in the longer run (whether from a security perspective, equipment failure, or otherwise). 

Sharon Parker's picture
Thank Sharon for the Post!
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