For over a decade now, oil fields have become increasingly digitized. The move towards high tech technology helps to facilitate fast and efficient decision-making, improves oil production, enhances the monitoring of well-head and pipeline flow activity for potential problems, and improves visualization capability so that changes can be tracked and decisions made quickly and most importantly in centralised SCADA command and control centres thousands of miles away optimising resources. The digital oilfield “concept” involves capturing operational data through sensors at the well-head and other operation points. Data is collected from various sources and is transmitted in real-time through the company’s work flow processes so that management can work almost proactively in most cases.
Digitization helps oil (and gas) companies to address challenges such as the remote location of reservoirs, challenging geographies, tighter environmental restrictions, and a decreasing workforce. Electricity utilities experience similar challenges, especially when they are faced with the after-effects of a natural disaster such as hurricanes which are on the increase due to climate change.
Digitization is also improving energy efficiency and safety of companies’ assets and staff. Many will agree that there is a definite and immediate return on investment. For instance, San Diego Gas & Electric reports that through digitization, outage times were reduced significantly by locating the exact location of a fault. They are also able to accurately predict future disruptions and outages.
Huge benefits for the utility
It is therefore no surprise then that industry expert Raj Samani-EMEA CTO McAfee Inc/ Chief Innovation Officer for the Cloud Security Alliance/ Special Advisor for the European Cyber Crime Centre, suggests that the same oil field digitization can also benefit the utility. Digital oilfield technology, which is in line with a fully automated, fully online smart grid, offers a major return on investment and it definitely enables businesses, according to Mr Samani. He explains that this secured technology can improve operations exponentially in any environment and that it offers a “clear return on investment” within a matter of weeks. Utilities, like oil field operators, are able to control the infrastructure digitally from a central location instead of sending someone onsite to investigate a potential problem. This saves a great deal of time and money when having to fix or reboot a system at a remote oilfield or substation.
Staff will also be happy to know that they will be safer than before as trips to unsafe, isolated and geographically difficult areas will be unnecessary. Often, staff are forced to venture in to the field during and after natural disasters have played havoc with electrical infrastructure. With digitization, this won’t always be necessary as faults can be pinpointed and corrected from a central station.
Consumers benefit too
Consumers also get to benefit. Because the technology provides advice and recommendations with regards to efficient energy usage, consumers can expect to save money. This cost-saving will appeal to the customer as it is tangible and is a direct value statement. Mr Samani points out that it is essential that this value be communicated to the consumer. Customers want to know how they will benefit personally. A grid upgrade will not interest customers even though it will benefit them indirectly (fewer outages) but, it is a different story when there is a personal saving to be made in the business or home.
The smart grid offers numerous opportunities which have yet to be tapped into. Mr Samani suggests that personal data is “the new oil for the digital economy.” He adds that the personal data economy is valued at US$15tn, two thirds of which can be realized by the consumer.
He describes a scenario where utilities can contact individual customers and suggest more efficient appliances. These suggestions would, of course, be based on consumption data received from the grid. With consumer consent, this information could even be handed to appliance manufacturers. The process must be transparent and consumers must be given the choice to opt in or out. In this way, explains Mr Samani, there will be great value for all willing participants.
What about security
Although “fear mongering” is a major challenge for digitization, Mr Samani believes that “security can be an enabler.”McAfee is currently joining forces with a utility in order to identify ways in which secure technology can be used to help enable the smart grid. He says that companies need to follow a rigorous process in order to really understand the risks and approach the system with “eyes wide open.”
In order to remain relevant today, utilities must embrace and deploy digitization in the right places and at the right time. The decisions that utilities make now will have a major impact on their competitive position in the market for the foreseeable future.