What will be the most immediate impact of the IoT on the industry?
We believe IoT will keep the industry busy on two fronts: first, the technology will be leveraged to improve customer experience along with re-shaping consumption patterns; and second, it will help integrate IT and OT thereby consolidating data in a single instance, enabling organizations to explore the data to drive exponential improvements in efficiency along with product and pricing innovation.
From our own experience of integrating IT and OT for utilities, it is becoming clear that data from substations, smart meters, SCADA and real-time feeds from various IT systems is being leveraged to improve energy efficiencies and reduce consumption/peak demand. Processed OT data, coupled with IT systems, is leading to a reduction in operating costs, while enhancing greater customer engagement. One of the key values we have unlocked using analytics as a layer over the data is reducing the ‘noise factor’ by optimizing the management and responses to events. For a large utility with 2 million AMI meters this approach has the potential to deliver annual savings estimated at between US$1 and 3 million.
Why spends on data analytics are on the rise?
According to an industry report last year, utility spending in North America on data analytics - which can be viewed as a direct derivative of the IoT - is expected to grow 29% each year, totaling over US$2 billion by 2016. The global figures are even more arresting: investments in smart grid data analytics alone are expected to be over US$34 billion by 2020.
Data and analytics are just two aspects of technology that converge with the IoT. There are a vast number of additional technologies that it also brings together - including hardware, sensors, devices, apps, telematics, data, analytics, mobile and cloud. The technology partners you choose are therefore crucial to your success. For utilities it has become imperative to make an accurate assessment of how software vendors, device makers and telematics platforms will reshape products, impact customer experience and help meet regulatory requirements. Collaboration with experienced partners to develop an IoT strategy will be pivotal to creating a thick value wedge across functions.
How Visualization has become a critical success factor?
Not surprisingly, there are as many solutions available as there are vendors. Each vendor takes an approach based on their own strengths. The question to ask of yourself is, “Can my vendor leverage the IoT so that every employee in the organization can begin to think like a shareholder?” If the answer is “yes”, you’ve found the right technology partner.
Visualization of complex data is important to the future of utilities. People absorb and respond to visual data much faster. Operations, people, skills, vehicle movement, asset status, supplier activity, safety information, market movements, etc., become available in perspective. Visualization helps process patterns and observe anomalies based on experience more accurately. These can then be easily matched with forecasted situations, historical outcomes and best-case scenarios.