Data Analytics-The Cloud Killer App for the Smart Grid

As the volume of smart grid data escalates, more utilities are looking to cloud-based solutions for data management and analysis.
Published: Fri 07 Feb 2014

Utilities are running out of room for all the data it is collecting from the smart grid. This is one of the reasons why cloud computing is becoming so attractive. But it’s not only about external data storage. Cloud based solutions are assisting utilities with the management and merging of smart grid data with other forms of data to deliver information that can help a utility save money or improve operations-ranging from grid controls to customer engagement.

Return on Investment

By switching to an off-premises cloud-computing model, the utility can save a great deal of money. The cloud eliminates the traditional hard-wired relationships between application, server, hardware, network, and storage, freeing these resources from their traditional constraints. Cloud providers normally deploy low-cost commodity hardware, with a layer of software-based management. This allows for various configurations. As a result, moving to the cloud will generally increase the return on a utility’s technology investment.

For example, if a utility spends US$100,000 per month on self-hosting that generates US$110,000 per month., that would result in a 10% return on investment. By outsourcing hosting to a cloud provider, and lowering monthly expenses by US $20,000 per month, that same US$110,000 could still be generated if the application performs at the same level. That would total a 37.5% return on investment.


Concerns around data protection and resilience seem to be the most common factors in holding CFOs back from allowing a third party cloud provider to host data. However, the use of a private cloud, managed by a trusted supplier, should be seen as an opportunity to increase the security and resilience of data , says Keith Tilley, managing director UK and executive vice president Europe for SunGard Availability Services, as you would be entrusting it with a specialist for whom this is their main focus.

Tom Siebel, Chairman and Chief Executive Officer, C3 Energy, explains in a recent interview with Engerati, that data is actually safest in cyberspace and not behind a company’s firewall.

Cloud also provides a scalable solution, unlimited data access, computation systems to analyze raw data and cost savings, in addition to the reduced need for data storage and server configurations. Combined with an online interface, cloud computing gives utilities and customers access to accurate consumption data at any time via smart phones, tablets, desktops and laptops.

Cloud also provides computational power for complex smart grid projects.

It comes as no surprise then that the market potential for cloud-based services for utilities is enormous. GTM Research has revealed that the U.S. rural cooperative smart grid spending will be at a cumulative US$4.1 billion from 2013 to 2017, and municipal utility smart grid spending will total US$4.5 billion to US$9 billion from now until 2017.

Market opportunities

Companies such as Landis+Gyr have picked up on this need and have recently announced that Newport, Oregon-based Central Lincoln People’s Utility District has signed a five-year contract for Gridstream® MDMS to host the utility’s advanced metering data. Central Lincoln’s software and data storage will be hosted by Landis+Gyr as part of its Cloud Services offering.

Oracle is another company that has seen a market opportunity and is developing new features for the utility. Enabled by its cloud-based analytics, the company has developed solutions for transformer health monitoring, outage detection and restoration and data quality improvement.

Skills issue

The first big issue is that utilities are struggling to find staff that have experience in big data analytics and also have a working knowledge of the electric utility business. Mr Siebel points out that off-premises cloud service providers invest a great deal of money in skills required for data analytics and that utilities will be hard-pressed to replicate the standard of skills employed to deal with today’s data challenges.

Often, skilled electric utility staffers are too wrapped up in their own daily work schedules to learn new analytics tools. And, it often doesn’t pay to employ data scientists and analysts who are clueless about utility operations as they often don’t know what to look out for. A balance of both would be best. This is where pre-packaged, cloud-hosted analytics applications can help to resolve this issue. These applications offer utilities solutions without them having to make capital investments in additional data servers and they get assigned utility skilled data scientists as part of the service.

For utilities that are already drowning in big data, thanks to smart grid technology, cloud-based solutions can improve the speed, security and scalability of data management systems.


Cloud-based analytics also allows utilities to collaborate with other utilities to address more complex business issues and identify new key performance indicators. While analytics collaboration has been focused on collaboration within the utility, cloud-based analytics offers an opportunity for utilities to collaborate and possibly find solutions together.

Utilities will have the opportunity to use the cloud as a “testing site” to share analytical information and analytics best practices. This can only serve to benefit the utilities, as well as their customers. As utilities start coming together to resolve complex issues, analytics is bound to progress.


Cloud is proving to be cost-effective. Cloud technology costs less than a server-based system required to manage the same amount of data on-site. Cloud does away with on-site servers, storage technology and software applications. Providers fully manage services, which are sold on demand per minute or hour, giving users as much or as little service as is required. There is also no need for hardware purchases and replacements because this equipment belongs in the cloud provider’s environment.

This of course also relieves internal operations when systems are down and need immediate, around-the-clock support. The highly automated cloud allows information technology personnel to shift focus from updating software to dealing with other more pressing in-house issues.

These include multi-core processing capabilities and resilient load distribution, which can help break down and process tasks efficiently.

While cloud is still in the early stages of development and adoption within the utility industry, a number of benefits are already evident and are offering robust solutions to wide-ranging obstacles that big data is posing.