Driving innovation is important for power utilities across the energy value chain, from generation through the network to the customer premises.
According to the International Renewable Energy Agency (IRENA), "Innovative solutions can make energy production, transmission, and consumption more flexible, allowing for a higher, cost-effective use of renewables and empowering a new generation of energy consumers."
In this blog, I share some inspiring innovation examples from forward-thinking utilities that are working to overcome key challenges across the energy value chain, along with recommendations for embedding innovation into a utility’s DNA.
Example 1: Improving energy generation efficiency
The energy transition is the top business priority for energy and utilities executives we interviewed for the 2022 CGI Voice of Our Clients (VOC) program, and enhancing energy production efficiency is crucial to advancing this transition. Following are some examples where innovation is making headway in the renewable energy value chain:
- Optimizing renewable generation with machine learning: In microgrids, machine learning (ML) algorithms are improving the dispatch conditions of power plants by optimizing weather forecasting technologies (e.g., cloud-imaging and sensors to monitor wind speed, temperature and direction). ML also predicts energy production at solar power plants and wind farms, helping to balance supply and demand and minimize losses due to surplus power generation
- Increasing solar panel efficiency through waterless cleaning: Accumulating dust on photovoltaic solar panels reduces output by as much as 30% in one month, so regular cleaning is essential. MIT estimates that cleaning solar panels uses about 10 billion gallons of water annually. Their researchers have devised a waterless, no-contact system that uses electrostatic repulsion to cause dust particles to detach and virtually leap off the panel's surface.
- Reducing hydrogen electrolyzer costs: Green hydrogen, produced using renewable energy, is expected to help accelerate the transition to net zero. However, more research and development are needed for large-scale electrolyzer and fuel cell applications. According to IRENA, “investment costs for electrolyser plants can be reduced by 40% in the short term and 80% in the long term through key strategies such as improved electrolyser design and construction, economies of scale, replacing scarce materials with abundant metals, increasing efficiency and flexibility of operations, and learning rates with high technology deployment aligned with a 1.5˚C climate target.”
Example 2: Stabilizing power transmission and distribution
Utilities spend billions of dollars annually on technology solutions, yet delivering a consistent experience across their networks remains challenging. Innovation is necessary to ensure a stable power network, reduce losses, increase efficiency and cut costs, and enable fast and automatic recovery from power failures.
Here are examples where innovation solves key challenges in transmission and distribution:
- Using 3D printing to produce spare drone parts: In Dubai, where I previously managed projects for the electricity and water authority, we had specialized labs that used state-of-the-art 3D printers to produce prototypes and spare parts for the generation, transmission and distribution divisions and to support the digitization of the inventory. We also used 3D printing technologies to create prototype spare parts for drone fleets used for daily operations as well as preventive maintenance and emergency intervention. This approach not only maximizes cost efficiency, but also mitigates supply chain issues, as drone spare parts can have long lead times even when supply chains are stable.
- Finding green alternatives to circuit breakers: As electricity generation becomes increasingly decentralized (e.g., rooftop solar panels, battery storage, etc.), transmission and distribution networks will undergo a sea change. Hybrid AC/DC microgrids harness the best alternating and direct current solutions to power future cities. Current circuit breakers, however, use gases that are harmful to the environment. One example breakthrough in eco-efficient innovation is a carbon-reducing high-voltage breaker that uses a CO2-based gas mixture as the insulation and switching mechanism, instead of sulfur hexafluoride gas (SF6), a greenhouse gas.
- Enabling more frequent pipeline inspections: Pipeline integrity is key to meeting energy demand in a safe, secure and sustainable manner. One way gas transmission operators improve pipeline integrity management is by using state-of-the-art aerial inspections to detect potential leaks and interferences. Further innovations use drones and satellite data with intelligent analytics to detect issues faster and at a lower cost.
Example 3: Enhancing the customer experience
Digitizing to improve the customer experience is the top business priority for utilities executives, as shared during VOC interviews. For 92% of utilities’ C-level executives, it’s the top business priority.
Following are examples where innovation is improving the customer experience:
- Enabling happier customers. Utilities are innovating to help customers manage their own energy consumption through smart meters and intelligent apps that alert them to unusually high usage (that could indicate a possible leak, for example). Some companies offer unique incentive programs to encourage customers to shift energy consumption during peak periods and enjoy cash rewards for meeting “challenges” to lower the temperature of a home or building by a few degrees during peak hours. The result: lower consumption, lower bills and happier customers.
- Creating an end-to-end digital shopping experience: An increasing number of utilities add marketplaces to their customer digital experience where they connect their customers with business partners offering all sorts of electricity-using equipment (e.g., smart thermostats, high-efficiency HVAC and networked charging stations, etc.). Mapping customer-specific journeys for utilities' networks of distributors, dealers and end customers, from point of purchase to after-sales service, requires defining the strategic scope for transforming the digital experience. To inspire stakeholders with best practices and the latest innovations, a leading utility is focusing on diagraming the customer and employee journey into functional matrices to identify the digital solutions that support these new experiences.
- Empowering greater self-service with the cloud. Cloud advantages such as data security, storage and access open the door to better customer service. For example, giving customers a cloud-based portal where they can access their data via a dashboard allows them to take actions on their own, such as make a payment, request a quote, evaluate promotional offers, view different plans and pricing, ask questions, submit a case or ticket, etc. Everything is at their fingertips. Long wait times are avoided, along with the need to repeat the same data every time they contact the call center.
Key considerations for embedding innovation in utilities’ DNA
Innovation is a continuous journey for utilities requiring a long-term and strategic approach to successfully transform to realize tomorrow's competitive advantage. A key enabler is to embed innovation into the organization’s DNA. Innovation is not just about technology. It’s about aligning the entire organization and ecosystem to continuously improve upon the delivery of outcomes. It’s a mindset and a strategy that permeates the entire organization.
Following are recommended actions for advancing innovation in utilities:
- View innovation as intrinsic to the entire enterprise.
- Pursue an innovation-conducive culture that fosters human connection and diversity. (Culture change is the top constraint to achieving business priorities, according to 56% of utilities executives in our 2022 VOC interviews.)
- View safety and innovation as complementary, not mutually exclusive.
- Encourage working in concert across the enterprise. Collaborating toward a common goal, with a unified cadence and rhythm, accelerates organizational transformation.
- Establish clear KPIs with a proven framework to ensure those KPIs are measured and tracked, and ensure regular reviews at all levels of the organization.
I invite you to read more about "sparking and sustaining innovation in utilities" in a blog by my colleague Jeff Bailey.
Author Saoud Kitana is a director and consulting expert for energy & utilities at CGI. More: Read more CGI guest blogs here.
