Mark Johnson, Managing Director, The Utility Analytics Institute

As the old saying goes, the only constant is change. The corollary that I’ll add is this: and the pace of change feels like it's directly proportional to Moore’s Law.

Utilities used to be favorites for conservative investors. Smooth. Steady. When there was change, it was incremental. But today, uncertainty and massive changes are becoming standard operating procedure in today’s utility environment.

How are utilities dealing with these changes and how can analytics help? We asked Mark Johnson, the Managing Director of the Utility Analytics Institute, about what he sees as the major trends in utility analytics for 2018 and beyond.

Analytics needs differ for large and small utilities

Looking at the larger trends, Johnson broke his response down by utility size to describe how different the needs can be across the utility spectrum.

For large utilities, Johnson and the Institute see a transition from point solutions to a platform approach when deploying analytics. “Point solutions only get you so much value, just incremental value," he said. "Bringing in more data can create more value, as can leveraging analytical tools and capabilities across the enterprise.

This all speaks to the need for an enterprise analytics platform,” At a recent conference hosted by the Institute, Johnson said the CIO of a large investor-owned utility noted that they're venturing down the analytics road…for the fourth time, and that this time they are applying lessons learned and taking the enterprise platform approach.

For mid-sized and smaller utilities, Johnson sees a different set of needs emerging. Mid-sized utilities call for an ecosystem of partners as they typically don’t have the time, talent or resources to do a lot of the advanced analytics they see as necessary to survive and thrive in today’s and tomorrow’s utility business environment.

For the smaller utilities, the Institute is listening to their members and hearing that they need to find a place to start and in many cases this is around a point solution that might afford them with some quick wins that are also not as expensive.

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Emerging areas for utility analytics

What other emerging areas are important developments to keep an eye on? Johnson recommends the following:

The Internet of Things (IoT) for utilities

“Utilities are in that next phase of IoT," said Johnson. "Utilities are putting, or have already installed, all of those devices out there that will drive a lot of new data that will create new value. Infrastructure will be commoditized. The value will be in data and what is learned from the data.” The 2018 edition of Utility Analytics Week in October will include more IoT content, he said, and the Utility Analytics Summit in April will have an executive panel session on IoT to bring some more light to the this important topic.

Machine learning and artificial intelligence for utilities

“It’s still pretty early in the journey for utilities in this area, but we see the predictive capabilities here driving some interesting improvements in a lot of utility work that has been traditionally manual and reactive," said Johnson. "On the asset side, uncovering anomalies is where utilities are going to be using this pretty heavily, and natural language processing will be important for customer service improvements.”

Home automation and utility analytics

“This is an area that has a lot of potential, but there are some inherent challenges, too," explains Johnson. "Among these are, the reach of a utility is limited to its service territory. It’ll be hard to get to the critical mass needed to be successful in this space. A second consideration is getting alignment with the utility’s brand and customer needs to achieve traction and growth in this market, which has been extremely difficult for utilities, historically.”

Load forecasting for utilities

“We see load forecasting as a potentially huge area for growth," said Johnson. "We are seeing and hearing this from our members and at industry conferences. The drivers for this include the complexities of surging renewables and the more granular data from smart meters.”

Looking back over this list and putting it in the context of where we were as an industry in 2013, it's staggering at how much the utility industry has changed in these five short years. Strap in and enjoy the ride….and a special thanks to Mark for his time and insights!

For information on the topics covered in this post, check out SAS Analytics Platform, SAS IoT Solutions and Utility Analytics Institute.

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About Author

Mike F. Smith

Mike Smith is a 26-year veteran of the utility ‘smart grid’/IT/automation, information services and media business, and is currently the Utilities Principal Industry Consultant for SAS, where he is involved in client engagement, thought leadership, and business development activities to drive growth of the business unit. Immediately prior to joining SAS, Mike was Vice President, Sales & Marketing at E Source. He was previously Vice President, Utility Analytics Institute where he has been responsible for product development, business development, and growth of the division. Mike is a graduate of San Jose State University (BA, Economics) and is a veteran of the US Army (Captain, Infantry).

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1 Comment

  1. Nice article. I find it interesting that load forecasting is high on the agenda for utility analytics. There are a lot of interesting models out there that convert weather into short term forecasts. They've been around since the dot-com era. But like you and Mark conveyed, it's a lot different today with solar, wind and energy storage. If you can gain some understanding from sensor data that helps companies forecast load better you will have really solved something.

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