The Infosys Utilities Blog seeks to discuss and answer the industry’s burning Smart Grid questions through the commentary of the industry’s leading Smart Grid and Sustainability experts. This blogging community offers a rich source of fresh new ideas on the planning, design and implementation of solutions for the utility industry of tomorrow.

April 26, 2019

Utility Regulation: some considerations for the future

Utility regulation is generally complex, no matter where in the world it exists. By nature utilities tend to be a monopoly in the areas they serve, as there is generally only one utility connection of each type (water, electricity, gas, telecom) serving a property. Governments are rightly concerned that customers receive good service and value for money, however does the regulation need to be complex, and are there issues that are not being addressed through regulation?
 
Utility regulation is commonly split into two areas, the first being customer service. Various qualitative and quantative measure are used here. For quantative measures, time of response to queries, and the avoidance of repeat queries, are generally used. Qualitative measures are based on some form of structured survey of customers who have contacted the utility. Companies are then ranked against each other, and in some cases these rankings used as incentive mechanisms (i.e. the top ranked gains incentives, the bottom ranked loses incentives).
 
The second area is investment. This covers new or replacement assets (capital expenditure, or CAPEX), and maintenance of existing assets (operational expenditure, or OPEX). Sometimes these are combined in net present value (NPV) or similar calculations to give 'benefit over time' values (total expenditure, or TOTEX). Recently there has been a focus on base operating expenditure (or BOTEX), however this is really a subset of OPEX. Regulators ask utilities to prepare business plans for future investment over a period, scaling risks (e.g. asset failures), issues (e.g. population growth, climate change) and opportunities (e.g. improved quality) against expenditure options. After some discussion between regulators, the utility, customer bodies, other regulators and government (local and/or national), a business plan is agreed for the particular period. The utility is then measured against this plan by the regulator.
 
However is this overly complex? Whilst the customer measures are simple, in reality most customers regard a utility as a 'fit and forget' service. As long as clean water comes out of the taps, the toilets flush, the lights come on and the gas flows, then they are happy, subject to them paying what they regard as a fair price. The prime focus should therefore be on providing a reliable and safe service. Reliability of service forms part of regulation in some cases, but not all. In terms of investment, the main factors that affect cost are the distance to provide the service and the number of units provided. So for each customer, the more units provided and the further this has to travel, the more that service will cost. There is therefore a curve that can be drawn against units and distance per customer, with companies below the average curve performing more efficiently.
 
All of the above mechanisms do miss a key issue, and that is ageing assets, an area largely not addressed by current regulation. Many utility assets are old, and replacement cycles very long. For example there are electricity cables over 75 years old, and water mains and sewers over 150 years old. Current replacement rates mean that water mains would only be totally replaced after 150-200 years, and sewers 400-600 years. The replacement cycles for electricity and gas are similarly long, with transformers often only replaced after 80 years. Are such timescales realistic, or are we building up problems for the future? A good measure for any utility would therefore be the 'residual life of assets'. Across their asset base this 'residual', or time before failure, should at least be maintained, or ideally improved, so that burden is not placed on future generations. However more research is needed on rate and probability of failure, so realistic asset life for each type of asset can be determined. There has been some work in this area (such as condition based risk management and pipeline integrity management), and modern tools such as AI and Computer Vision may be a great help in such research and analysis.
 
So is current regulation fit for the future? I would argue that we need to both simplify measures with regard to customer service and investment, as well as building new measures to ensure that the utility is looking after their assets for future generations. We need to address these issues very soon, otherwise we may find that we are increasingly chasing asset failures. Fixing things before they break is generally much cheaper, and avoids a lot of pain for us all.

September 28, 2018

Change Challenge


With the many disrupters affecting all aspects of our life, change is a constant (see my previous blogs). However, at the heart of any change are people, and change can be frightening for many, leading to uncertainty and inefficiency. All too often good ideas have been lost through poor management of change.

Effective management of any change is therefore vital. Understanding the current issues facing a business seems a very basic task for all implementing change, but problems can be hidden and the underlying root causes obscured by people protecting their current ways of working. This can be for many reasons, some related to maintaining their perceived status, others more driven by a fear of the new: the 'known' is far more comfortable.

So how are these challenges managed? There are many tools and techniques that are used across industries, and many can help understand the issues and concerns at a global level. However, the best technique is listening. Taking time to talk, and most importantly listen, to those doing the work can deliver far more insight than many workshops. A couple hours sat beside someone using the current tools, and seeing the issues they have, the frustrations they suffer, is invaluable in shaping the new solution.

We, in IT, live in a world where 'new' is exciting, and change is invigorating. To many actually doing the work, however, it can be daunting, and cause impacts on their daily tasks. It is therefore vital that we fully understand the work that our customer is doing, and ensure that our new tool is capable of meeting the true needs of the end users. My Grandmother used to say we have 2 ears and 1 mouth, and should use them in that proportion: not a bad maxim on which to base our delivery of change.

August 29, 2018

Keeping Everyone 'Appy

Mobile applications (Apps) are now a major feature of most utilities, as an effective mobile workforce is critical to efficient operation. However far too often the Apps are not intuitive, are disjointed, and focussed on serving the backend rather than those in the field. Unsurprisingly such Apps have delivered far less value to the business than originally envisaged.


So what will keep everyone happy? Firstly, the Apps should be based around the actual job function. There are many deployments where 'standard' Apps have been used based on core network applications, however that often leads to field operatives having to use several Apps to complete a task. Workflows on the Apps can also be generic, meaning the operatives have to jump between screens to complete tasks. Unsurprisingly this leads to inefficiencies, not only in time field operative time, but also in inconsistences of data between the various Apps.


Secondly good Apps (i.e. the ones we all use on a daily basis) tend to be intuitive, requiring little training. This is generally because those who developed the App have a good understanding of the end user's needs. However, in utilities it is unfortunately all too common for those writing the Apps to have very little knowledge of the needs of the field staff.


Thirdly many utilities operate in areas where there is limited connectivity, and yet too many Apps rely on connectivity to deliver their service. It is vital that the user can obtain or enter the information at the location of the work or asset. If field operatives are unable to find or enter information at that location, there can be health and safety risks, as well as inefficiencies.


Keeping everyone happy with their Apps is not difficult as long as the basics of being task based, intuitive and working offline are followed. If they can also help the field operative identify issues with assets before failure, then the benefits are even greater, however that is another story.

April 25, 2018

The Only Constant is Change - the Water Cycle

There has a move back towards catchment based working for a number of years, and this has brought many advantages, especially in regard to environmental improvements. Generally however such working tends to be sector and company based. Although there have been a few cross sector studies and solutions, these are the exception rather than the rule.

There are a number of disruptive factors, such as the European Water Framework Directive, that are increasingly moving organisations towards multi sector and company integrated catchment solutions. There are already many studies that are pin-pointing pollution, both point source and diffuse, and moving solutions towards beneficial outcomes and away from 'tick box' outputs. There are similar studies looking at drought risk. However there are very few examples where such studies are joined, let alone linked to other water related impacts, such as flooding and agricultural production.

As new tools, especially the ability to collate and use large and disparate data sources, and the rise of AI, become increasingly available and affordable, such catchment whole water cycle working will increase, and provide real benefit across sectors. To enable this however will not only require new technology, but more importantly changes in working practice. For example, sharing of data between organisations will be critical. Individuals will need to understand more about the issues and potential solutions for others affected by the water cycle in an area. Whilst the technical challenges are complex, the organisational and people aspects present even bigger challenges. We must however overcome such issues if we are to deliver truly holistic and sustainable solutions.

April 17, 2018

The Only Constant is Change - Electricity 2.0

Electric networks are facing more variable loads at the local level (down to LV), including demands, such electric vehicles and heat pumps, embedded generation, such as photovoltaic, micro-hydro and wind and more variability of population density. These localised demand peaks put stress on the system and risk, leading to phase imbalance, voltage frequency and waveform issues, increased outage (customer interruptions, network interruptions), and thermal issues.

Traditional management of the network to mitigate those risks would lead to many issues. These include wholescale network capacity upgrades i.e. lay larger cables, larger transformers, major disruption, including to traffic and customers (planned outages), and significant increases to charges. These impacts would be unacceptable to customers and other stakeholders, including those whose journeys are interrupted by street works.

In the future Distribution Network Operators will need to become Distribution System Operators (DSOs). They will use LV automation and switching to balance loads and demands, This will mean a move towards Active (or Adaptive) Network Management, to be able to minimise and optimise the need for network upgrades. As such they will manage local networks like large national Transmission networks.

To become a Distribution System Operator, a network operator will need a solid base. This includes a sound connectivity model, the ability to link/share connectivity details with modelling tools, and secure links between core asset systems (e.g. GIS/aDMS). A few orgaisations are already moving in this direction, and I am currently involved in a DSO project. Such changes will become 'the norm' over the next few years.

January 28, 2018

Managing Smart Electric Meters- Things to Consider

The utility industry has been witnessing an immense rise of smart electric meters Implementation across the globe. With the digital revolution setting in, there has been an increasing move towards enabling advanced metering infrastructure(AMI) for effectively managing meter data and operations. The ability to enhance grid reliability, effectively manage peak loads and passing the control of usage back to the end customers have all catalyzed this trend. The envisioned benefits of smart meters to the Industry are many, but for me as an asset management consultant it gets me thinking- What's in store for me?

Continue reading "Managing Smart Electric Meters- Things to Consider" »

September 26, 2017

The Only Constant is Change

Everyone lives in changing times, and the pace of change is accelerating. In Utilities however, caution is rightly placed on any change, as our societies and to a large degree civilisation are supported by sound infrastructure. Nonetheless, the way we use our infrastructure will have to change radically over the next few years. Increasing population and population densities, climate change and aging infrastructure are leading to more system failures, in terms of outages, flooding and limitations on use. It is becoming more difficult to model the impacts of this change on our infrastructure, as many of the historic 'norms' no longer apply. Our universities have many research projects to try and better understand, and hence predict, how infrastructure will be affected by change, and the best options to adopt to ensure infrastructure can meet these challenges. Undoubtedly some of the new tools being developed, especially AI coupled to effective IT/OT integration will greatly assist in this area. I am helping to organise a Future Water Association conference on 4/5 December this year that will look at how we move towards 'smart water networks'.

Over the next few years however probably the area that will see the greatest change is electricity distribution. The way we both generate and use electricity is changing at an exponential rate. Embedded generation, such as wind and solar, means that supply enters the overall grid at many diverse locations, and intermittency means that the quantity of that supply will vary greatly over days and years. More demands, such as electric vehicles and heat pumps, mean that the peaks and toughs of power required will become more intense. To manage this in 'traditional' ways would mean major upgrades to the networks, which we cannot afford, either in monetary or disruption terms. Organisations are thus moving towards 'Distribution System Operation', where local networks, including LV, will be actively managed, in a similar, but more local way to how transmission networks are managed regionally and nationally.

This is the first of a series of blogs where I will start to explore what change might mean to utilities, starting with 'Distribution System Operation'.

July 20, 2017

Utility Procurement - a New Vision

Innovation is part of the 'DNA' of Infosys, and we are always being asked to innovate by our clients. All too often however the procurement process constrains our ability to offer that innovation. The deliverables are given strict bounds, and we are only able to offer specific solutions. For example, the need may be for improvements in asset management, but the tender constrained to configuring and installing a particular software package. Whilst in a few cases that may be due to a poor procurement strategy, in most cases it is due to the constraints, both regulatory and corporate, that control how procurement can be undertaken.


Does it have to be this way? I believe that clients could procure in an innovative way, that allows their suppliers to show their ability to offer novel ways to solve problems. The process could be two stages, the first a simple pre-qualification exercise to determine a shortlist (as is currently undertaken), the second to deliver an outline design of the solution, where the client pays a small fee to the tenderers to get into far more detail than current tenders allow. This will enable the supplier to demonstrate their ability to deliver innovation, and the client to both understand that ability, and know how the supplier performs in a work situation. Such a process would enable to client to tackle much larger issues than generally covered in a tender, and indeed a few utility clients are already using a more agile approach. I will demonstrate with an example in asset management.


This example tender could be phrased "Devise a solution that will deliver an x% reduction in asset management costs, whilst producing a y% improvement in performance, without increasing overheads." In the pre-qualification, tenderers would need to demonstrate experience in such areas (although not necessarily in the same industry), and provide good and pertinent references: this would allow the client to shortlist. Tenderers could also consider partners to add to their bid, for example instrumentation suppliers and installers. In the tender, the client would allow a certain sum for each tenderer to produce their innovative solution, with sufficient access to client staff to determine constraints, both technological and business. This phase would of course need to be undertaken under non-disclosure agreements to protect all parties. Once the 'tender' is completed, the client would be able to select a supplier with a much greater understanding of that supplier's ability to innovate in a way that will benefit their business.


Whilst this system may seem strange to some in utility procurement, it is similar to those employed in areas like architecture, that have allowed buildings such as the Sydney Opera House to be developed. Do we want our future to be full of bland boxes, or Guggenheims?

March 14, 2017

The Security trap

Security in IT is very important. Unauthorised access to confidential information can cause major disruption to companies, and to individuals lives. Some disruption can have life changing impacts to finance and reputation. Even 'lesser' security issues, such as viruses, can cause massive damage to company systems. Breaches to Operational Technology (OT) systems (such as SCADA) in utilities could cause countrywide failures, and put lives at risk. IT security is therefore quite rightly taken very seriously by governments, organisations and individuals.


However IT security is just one amongst the many risks we all face on a daily basis. Even a major breach of a utility OT system would not have the impact of an atomic bomb, and yet the world managed to increase overall wealth, and made great strides to reduce poverty, throughout the Cold War, under the threat of mutually assured destruction. IT security is therefore just another risk that we all have to manage.


Unfortunately in too many organisations IT security is used as a reason not to implement technological improvements. For example, video conferencing between computers, and even mobile devices, is something many of us use regularly, however video conferencing between organisations is very rare, generally because of 'IT security' concerns. Sharing of information is frequently blocked, and yet shared information often increases knowledge and opportunity for all of the participating organisations. For example, Transport for London (TfL) made most of the information for its transport systems (e.g. timetables) publically available: there are now a plethora of 'apps' to help travellers plan their journeys, all of which have been produced at no expense to TfL, and increase customer satisfaction.


I believe it is a duty of those of us in the IT world to ensure that IT security is managed appropriately, and not used as an excuse to block the business and personal benefits that our innovative technology can bring. Like any other risk it should be managed appropriately and balanced against the benefits. We cannot let the few who would wish to take advantage of us through IT security breaches constrain our future.

March 3, 2017

The Asset Management Journey - into Adaptive

For utilities, traditionally most asset management was based on cycles of planned maintenance, interrupted by many occurrences of reactive work. The planned maintenance was generally based historic norms, often with little feedback of benefit. With the advent of asset management systems, both IT (e.g. EAM/WAM) and Process (e.g. PAS55, now ISO 55000), work became more planned, and was more based on benefit, drawing particularly on asset risk and criticality. Such changes made major improvements in efficiency, with reductions of reactive work from 70% to 30% not uncommon. However planned work was, and in many cases still is, based on expectations of asset lifecycle performance, and not on actual asset feedback. Whilst such proactive strategies reduced service impacts, it led to higher levels of planned maintenance than necessary to ensure optimum asset life.


Over the last 20 years industries have increasingly turned to predictive methodologies, using sensors and instrumentation, coupled with appropriate analytic software, to predict and prevent asset failure though understanding trends. For example, a large transmission operator uses transformer load measured against ambient and internal temperature. A band range of 'normal' internal temperature against load and ambient temperature is mapped, and the system flags when internal temperature is outside of this range, so that checks can be made before any failure. Increasingly such tools are using machine learning which further helps to predict 'normal' asset behaviour. Asset management has therefore moved from Reactive through Proactive to Predictive.


Artificial Intelligence (AI) tools, such as Infosys NIA, are now starting to be used in asset management. These new methodologies use the AI engine to collate, compare, analyse, and highlight risks and opportunities. The tools can use structured and unstructured data, static and real time, and have the ability to take data from disparate sources. The systems will increasingly refine understanding of asset behaviour based on multiple inputs, such as sensors/instrumentation, third party data (weather), social media feeds, and impacts flagged by external, but publically available, sources. The tools will then be able to advise courses of action based on current events. They could also then be used to model possible scenarios, and advise actions and impacts based on their understanding of inputs against outputs (stochastic modelling +). Such tools will enable an organisation to continuously adapt its asset management strategies and implementation to current and future events.


I call this Adaptive Asset Management.