When you look at the improvements that utilities are making today, there is an argument for viewing these changes as an “evolution.” Most will agree that these changes are not about leading-edge technologies; rather, for 20 years or more, the focus has been on pragmatic deployment and refinement of ideas already employed.
There is also an argument for viewing changes within the utility industry as a “revolution.”
To analyze this further, we first need to separate the concepts of “smart grid” and a “smart utility.” A smart utility is not singularly focused on technology, but at the highest level it is focused on continuous improvements in reliability, operational productivity, energy delivery cost, and customer satisfaction. Its objective is to define and refine the combination of technology, processes, and organizational and customer-facing elements that, holistically, deliver improvements. A strong business case quantifies these collective benefits and supports the roadmap for enterprise changes.
Customer satisfaction is an evolving area of focus—one that requires balancing customer and utility interests. On the utility side, demand side management (DSM) programs and time-of-use (TOU) plans are programs that shift, shape load, and better allocate the cost of service to consumers. On the customer side, these programs provide insight into usage, opportunities for cost savings, and awareness of national conservation objectives.
The concept of the “evolution” of a utility is built on a solid positive business case and a roadmap that takes into account increasing interdependencies within the utility. This perspective is driving the unification of the utility from a heritage of departmental roles with cookie-cutter repeatability, to a comprehensive organizational view of people, processes, technology, and customers.
The concept of a “revolutionary” change within a utility is based on the need to address regulatory mandates, interdependencies, and infrastructure improvement urgencies. Some of the government-level mandates are driving rapid change to storage technologies, electrification of transportation, security, incorporation of renewables, and di-directional flow. At the same time they are dealing with new government mandates, utilities must deal with the growing concentration of electric vehicles, uncertain energy delivery patterns of renewables, and changing wholesale rate structures—thus the feel of a “revolutionary” environment. Amid this added complexity for load forecasting, availability, delivery, and potential price fluctuations, utilities must be able to guarantee delivery. This means managing operations and responses more quickly, and with limited staff additions.
The smart grid provides a path for reliable and stable electricity delivery against these increasingly challenging requirements. It is an important component of the maturity path of a smart utility.
West Monroe Partners works with utilities to develop programs and customer communication plans that are consistent with their technology capabilities, customer demographics, and desired objectives. We invite you to contact us to discuss the technical aspects and roadmap for your smart grid, as well as the corresponding functional aspects involved with managing a smart utility: