Digital Transformation In The Energy and Utilities Industry
How companies are becoming more data-driven and moving faster to the cloud
Every industry is going through digital transformation, and the energy and utility market is no exception. These companies need to adopt various digital changes in their business models and processes in order to transform the way energy is produced, delivered, and consumed across the value chain. Businesses can enhance operational performance, make better business decisions, and improve the customer experience by successfully leveraging data and providing more accurate information via predictive analytics.
The drive for energy & utility analytics
The global utilities and energy analytics market size is expected to reach $6.55 billion by 2028 and record a steady CAGR in revenue over the forecast period, according to the latest analysis by Emergen Research. The need to optimize operations and business practices for maximum cost-effectiveness is driving the use of energy and utility analytics services and solutions among energy and utility companies.
The adoption of smart meters, prioritization of power generation planning, and the need for accurate forecasts are believed to be key factors driving the growth of the energy analytics and utility market. For utility companies, big data and analytics are essential to gain insights into customer behaviour, determine ways to improve solution performance and gain insights to grow the business. With data analytics, energy providers can customize their programs to maximize customer engagement as well as modernize those relationships to improve engagement.
The renewable energy market is another area that can benefit from big data analytics. According to a report by Mordor Intelligence, solar energy is expected to continue to dominate the renewable energy market, generating more electricity than wind and hydro in the next four years. With analytical solutions, utilities can optimize energy generation and planning by providing accurate energy production forecasts.
The Growth of Cloud-Based Analytics Solutions
In the energy and utilities analytics market, there have traditionally been two types of solution providers: service providers and software providers.
- Software vendors—such as Oracle, and Intel—offer platforms that deliver predictive analytics and software maintenance capabilities, data visualizations for customer information, and power distribution. These platforms help to reduce costs and downtime, as well as improve customer retention by understanding customer consumption patterns and helping improve the customer experience. Up until recently, software vendors dominated the utility analytics market. With the evolution of cloud technologies, however, service providers are gaining more market share.
- Service providers are companies that provide specialized funding or specialized services rather than actual products such as AWS, SAS, Google, and Microsoft. The term is generally reserved for companies involved in communications or technology, such as cell phone companies or Internet service providers. They help utilities move their analytics to the cloud to address issues such as infrastructure expansion, hardware/software costs, and personalized customer experiences. There are no software licenses or infrastructure to buy, so organizations can leverage the efficiency, scalability, and simplicity of cloud services to achieve their productivity goals.
- Cloud solution providers (CSPs) have come to the forefront, offering "done-for-you" technology solutions on a cloud network that can be accessed through an internet connection. They offer an elastic, cost-effective storage capacity in which businesses can run complex utility operations, including energy demand and distributed energy forecasting. In fact, MarketsandMarkets expects the adoption of cloud-based energy and utility analytics solutions to grow significantly due to their numerous benefits (e.g., easy maintenance of data generated, cost-effectiveness, agility, flexibility, scalability, and effective solution management).
Cloud-based and data-driven analytics systems are also becoming essential for managing the vast amounts of data continuously generated by smart meters, IoT sensors, customer home energy devices, etc. It helps simplify energy efficiency programs and allows utilities to provide flexible power, provide scalability, ease equipment maintenance and provide better customer service. Through deeper insights. World leaders in energy and utilities have moved their data analytics systems to the cloud. For instance:
- Exelon uses Oracle products, including Oracle Analytics Cloud, to gain a holistic view of customer engagement across all touchpoints across all dealerships and deliver a personalized omnichannel experience for its industry customers.
- GE Power runs its mission-critical data analytics applications on AWS using Amazon Kinesis Data Streams and Amazon Elastic MapReduce.
- ExxonMobil works with IBM, Amazon and other cloud leaders to gain real-time insights from data. This allows them to transform the customer experience by offering new payment options to consumers at Exxon and Mobil-branded service stations.
By eliminating legacy systems and taking a data-driven, cloud-enabled approach, energy and utility companies can reduce operating costs and increase efficiency. Big data and analytics also enable them to provide customers with better services and design programs to save more energy - thus ensuring customer loyalty.