IoT and the energy ecosystem - key smart utility challenges to consider

We assess key challenges for smart utilities navigating their next steps toward a more connected energy ecosystem.
Published: Thu 02 Aug 2018

Smart meters often serve as the first step in a long road to smart cities, utilities and infrastructures.

While smart metering and automation technology is still being rolled out in many places, utilities should be looking to the future to address the upcoming hurdles and how to ensure that the technology foundation laid today will be able to address pain points tomorrow.

The Internet of Things (IoT) will play a fundamental role in utility operations, especially in smart cities and homes. While this technology holds promise for utilities, it must be managed properly from the onset so as to ensure secure, reliable and valuable service to all stakeholders along the value chain.

Breaking down these challenges and addressing them is the starting point to developing and mastering smart developments in the future.

With key insights from Itron and Cisco, world leaders in smart metering and networking communications, respectively, we deliver assess key challenges for smart utilities creating their own energy ecosystem.

Costly losses hitting utilities

Be it from ageing infrastructure, misallocation or theft, resource loss can be incredibly costly for utilities.

In its white paper, “Welcome to the Active Network”, Itron cites a variety of research into energy loss, such as insight from the US Energy Information Administration that six to eight percent of electricity from power plants disappears due to technical losses from the transmission and distribution network, while another one to three percent is lost to electricity theft or other non-technical losses. Worse still is that those numbers can escalate to 30-40% in other countries with weaker infrastructures.

Then, with the increased penetration of distributed energy resources on the grid, comes the issue of increased stress on the already aged infrastructure, worsened further still by the rising number of people on earth living in urbanised areas.

Forbes expects the populations in these areas to extend beyond the already record-breaking 50% of the population up to 60% in 2025 - in Western, more economically developed countries, this figure is anticipated to reach as high as 80%.

With a busier, more strained and more connected grid than ever, utilities must begin to look for network solutions to safeguard reliability, improve efficiency and support an expanding range of solutions.  

Evolving data landscape and IoT

A key tool for improving efficiency, reliability and reducing waste will be IoT technologies, which connect the dots between not only utilities, but to all stakeholders – critical infrastructures, industries, devices and people.

Utility automation networks have historically relied on a central hub to aggregate and analyse data, however there is increasing pressure for distribution system operators to deliver information more efficiently and to deliver proactive customer service.

Wes Sylvester, Global Director, Energy & Transportation at Cisco, sees value in how the company is working towards creating the ability to run predictive analysis applications at the edge by reducing the amount of data coming back, enabling decision making at the edge and creating faster decision making in near real-time - especially in places where edge generation is pervasive.

He says: “If we can do it closer to the edge and then send it to five different places at once, then all of those applications can make decisions together and make the application run more smoothly and quickly."

By applying the best possible technology and processes to the IoT, utilities can create what Itron calls the ‘active network’, moving beyond basic data collection and into new possibilities including distributed intelligence, software-defined communications, multi-application networks, cloud computing, data analytics, and a new generation of battery powered edge devices and sensors.

Itron thinks of the future energy market as an ‘ecosystem’, explaining in its white paper: “the smart grid and the Internet of Things are bigger than any one company, or any one technology.”

Avista, one of the oldest utility companies in the United States, is one utility carrying out a pilot in which the utility is leveraging smart metering and advanced applications such as smart lighting sensors to increase public safety, energy efficiency, and air quality in the city of Spokane, in Washington state.

The solution relies on close collaboration between multiple stakeholders within the community – all enabled the utility’s deployment of a single active network that is able to support multiple applications.

Heather Rosentrater, Avista’s Vice President of Energy Delivery says: “There’s opportunity in terms of reducing the duplication of assets. If we have a network that we’re building for our metering system, there’s an opportunity for others that need network access to utilise that infrastructure as well. For the community members, you’re being more efficient in terms of providing the services that they’re getting from multiple different entities.”

Watch the webinar

Part and parcel of that future is, therefore, to think beyond advanced metering infrastructures of today, which are designed for the sole purpose of the utility. To enable smart cities, greater data proliferation and usability and streamlined operations, utilities should consider moving to more flexible, multi-purpose networks.

To learn more about these kinds of networks, how they operate and how best to integrate them into your utilities and cities, register now for our upcoming webinar, “Use cases for multi-purpose networks to improve flexibility, reliability and value”, featuring specialists from Itron.