The emergence of new business needs, driven by changes in the energy landscape, has led utilities to deploy intelligent energy networks. The implementation of sensing and metering devices will enable access to new data and trigger a data explosion that necessitates the use of data management solutions by utilities, according to a new report by Frost & Sullivan.
The report, “Data-driven Utilities,” finds that big data analytics and forecasting software will become the cornerstone of business in utilities.
"With the emergence of smart grids, utilities will start exploiting new data sources — grid sensors, smart meters and electric vehicles — to optimize their business and provide better customer services," Ewa Tajer, information and communication technologies research analyst at Frost & Sullivan, said in a statement. "Starting from reporting, billing and settlement, they will test new technologies and add new sources of data to their data management systems to build analytics capabilities."
Energy companies will also be forced to improve customer interaction by using social media and various Web data, Frost & Sullivan says. However, the firm notes that utilities have neither the requisite skills nor vision to handle big data. In fact, the main challenge delaying business model transformation is the lack of expertise and infrastructure, along with tight budgets and the perception of risk, it says.
In addition, many analytics technologies are still considered too expensive and will not be adopted unless their deployment is fully justified economically. As a result, some utilities opt for cloud computing and software-as-a-service analytics to unlock data potential in a cost-effective manner.
"Cloud computing may be the answer to overcome utilities' hesitancy in deploying advanced analytics solutions," Tajer said. "Certain utilities have already moved part of their processes — mostly non-critical ones — to the cloud, and smaller energy companies, in particular, are expected to increase investment in cloud computing over the next few years."
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