The benefits of smart metering go way beyond billing, as smart meters promise to provide utilities with a whole new breadth and scale of energy use data from their customers. But how will utility companies unlock the value of this information? Mike Ballard, senior director of strategy for Oracle Utilities, discusses how IT solutions help utilities make the most of customer data to optimise energy use throughout the grid.
M2M Now: Smart metering, to most people, sounds like a system of billing. How could utilities convince consumers it is in their interests?
Mike Ballard: As a strategy director it’s my job to bring this subject to life for people, so that utilities can share the benefits of smart metering with them. In its present state, discussions around smart meters don’t necessarily present a convincing case to consumers.
People are often unaware of how, and how often, they consume energy; for most, energy meters have traditionally been more or less static boxes hidden in a cupboard under the stairs and out of sight But with smart meters bringing more insight to consumers about their energy use, residential users and businesses will find new value in actively monitoring their consumption. Information from these devices will allow them to spot patterns in their usage, and recognise where most of their consumption is coming from. These insights will help them make more informed decisions about
their energy, and eventually change their habits to use less power at peak times and save money in the process.
We can do a lot more with the data that smart meters provide us, and this becomes even truer when it is presented in a way that is more engaging for consumers today. Taking advantage of the growing number of connected devices and
presenting information about energy use on people’s computers and smart phones using meaningful, easy to read charts and graphs make it more likely that they will appreciate the value of the information that their smart meters provide them, particular when it starts to help them cut costs. They might be encouraged to, say, start running their washing machines at night or on the weekends, when demand for power is lower and their high consumption periods will therefore be less expensive. Utility companies of course need to encourage this change in usage patterns with tariffs that reflect the varying costs of energy at different times of the day.
M2M Now: What changes will smart metering usher in?
MB: Information about energy usage will become even more important as enthusiasm for energy conservation grows. As people take to commonly installing solar panels on their roofs and generating power in their own homes, utilities’ networks will start to experience fluctuations in power that will have to be managed.
M2M Now: How do you make sure you get the right foundations in place to deliver the other benefits as you build on that?
MB: Oracle’s role is to help the utilities to engage with customers more effectively. They all understand that. They are all on a journey to improve.
But to achieve this, you have to get the right IT in place first. For utilities, the challenge now is less about engineering wires and pipes and more about improving their IT systems; by investing in the right innovative tools they can develop deeper insights into their network that will enable them to better manage their infrastructure and make their networks stronger. Many distribution companies have in fact been going through an IT transformation as they work to manage their assets more efficiently.
There will be information feeding in from all kinds of devices, with data on, say, electricity, that will give utilities new insights that they can act on. By studying voltage patterns on an asset, for example, they can predict if it is about to fail and pre-empt that outage by acting on that information.
The challenge lies in managing all those devices and information. The right foundations need to be put in place for everything to work. Basing these on open IT systems makes it less likely that users will be locked into partnerships with one particular vendor, and avoid finding themselves limited for choice by incompatible equipment.
M2M Now: What role will cloud computing play in the utilities market?
MB: Information Technology (IT) will play a major role in extracting more value from the network assets. It’s vital to get the right foundations in place and use the right innovative tools to help utilities slice and dice their data and deliver the insights that will help them do so. This means that information needs to be created, stored, and analysed not just
for billing processes, but also for improved forecasting ability, and better customer service.
The most obvious attraction of cloud computing is that it provides a way to take a large part of the risk and cost out of IT. Companies no longer have to predict the future and commit themselves to a massive capital investment. By using cloud services, their costs become operational, leaving them with greater flexibility to react to change.
This will become an important strategic weapon as the workload of the IT infrastructure becomes much more volatile. The numbers of informationgathering devices out there will increase, the frequency of reporting is likely to vary, and the amount of computing power needed to deal with all these calculations will be subject to much more frequent and dramatic variations.
These fluctuations can be catered for in the cloud, which utilities can buy as a service and scale up and down as necessary.
M2M Now: What are the process and management challenges involved in changing the way utilities work?
MB: One challenge for utility companies lies in creating a strong meter data management (MDM) strategy. This means channelling the large amount of data being created by all the devices on their networks, and calls for effective information management so that systems downstream from where data is hosted will get the right subset of big
data fed to them. Billing personnel will require different information than internal analytics teams, for example, as will those involved in forecasting or pricing. The MDM system is the hub at the heart of all this, a buffering point from which other systems are fed with the information they need.
Being able to analyse this data and delivering its full potential is the second challenge. Due to its scale and complexity this is hard to achieve with legacy IT platforms. The good news is you can now buy this capability as a service. Oracle offers analytics as a service so that utilities can get access to advanced tools to examine their big data. Hosting data and
letting a third party apply the latest techniques to analyse it, such as mathematical modelling, applying algorithms for advanced analyses, and identifying trends, will be a lot easier. By using cloud services, companies can get value from their data without having to make a major investment in infrastructure and skills, which leaves them the option to change course later.