In late February, executives, engineers, and everyone who is anyone in T&D gathered in Orlando, FL at DISTRIBUTECH International 2024. From corporate leaders like Oracle and IBM to innovative start-ups and industry analysts, thousands came to explore technology that will help create a smarter, more resilient, more sustainable grid.
The stakes are high – the electric power industry is preparing for as much as a “tripling” of US electricity demand by 2050. Much of this growth is attributed to factors like development in emerging economies, continued electric vehicle (EV) adoption, and investment in renewables, which are expected to soon make up the largest share of the new generation power mix. According to McKinsey, “investments in T&D networks are projected to experience growth of between 4-8% per year, reaching upwards of $1.2 trillion by 2040.”
Amid the fancy booths and eye-popping displays of futuristic tech, there was a palpable sense of curiosity from those in attendance. Word is out about the urgent need to update and strengthen the grid, and a lot of utilities are looking for help. That’s because utilities are still operational entities meant to supply power to houses, and most of their budget is directed toward things like vegetation management and infrastructure maintenance. Like many other industries, DISTRIBUTECH was also no stranger to the current hype cycle of artificial intelligence (AI). When it comes to maintaining and monitoring AI and machine learning (ML) pipelines, they need support – and DISTRIBUTECH attracts the best in the business.
3 BIG THEMES & KEY TAKEAWAYS
1. Advanced Analytics & Data-Driven Processes
Data remained a core focus of this year’s show – how to get it, and what to do with it. Asset management accounts for a significant portion of a T&D company's operating expenses, and data is the key to understanding an asset’s health. During any transformation, analyzing data will help gain actionable insights into operational strengths and weaknesses – including performance data from assets themselves, as well as visual data from drones and satellites that is used to monitor infrastructure and vegetation. From conversations and panel discussions, it’s clear that data-driven practices will be a core component in successful utility operations of the future, especially as demand continues to surge.
Here are 3 things utilities can do right now:
- Communicate across the organization to embrace a data-forward future. HBR says that data-driven cultures start at “the (very) top” and that top-performing utilities “tend to have senior managers who set an expectation that decisions must be anchored in data — that this is normal, not novel or exceptional.”
- Assess what data you already have. Determine who is in charge of data oversight, and where there are knowledge gaps.
- Identify the organization’s greatest weaknesses, and start there. Leadership needs to see business value, so it’s best to deploy any advanced analytical power on what will move the needle fastest.
2. AI/ML and Automation
Utilities will require new tools and technologies to handle more complex data sets, and it’s no surprise that AI and ML were important (and prominent) themes at DISTRIBUTECH 2024. The keynote speaker was Zack Kass from OpenAI, who labeled himself an “AI optimist” and argued that AI is the last technology humans will have to invent on their own. Kass encouraged attendees to “use the [AI] technology, think about how it can improve their processes, and ultimately help build the grid of the future.”
Automation and data-centric processes are being used at different points to create operational efficiency for utilities, including load forecasting, demand response, modeling the grid for renewable sources and EVs, image analytics, etc. Many companies across the industry have spent the past year evaluating where AI best fits into their organization, from testing voice-to-text features that help service techs in the field, to making digital infrastructure more resilient to cyberattacks.
Here are 3 things utilities can do right now:
- Consider hiring an AI leader or data ethicist to shape the organization’s data strategy. As more powerful AI continues to be developed, dedicated specialists will be needed to ensure its responsible development and deployment.
- Identify the areas where AI would be easiest to implement, and start there. Oftentimes, customer service offers the best opportunity to test new features, since it lends itself to more immediate feedback.
- Engage vendors that were built with an AI foundation and have seen significant growth in the last year. Given the speed of innovation (and the “surge” of new players in the space), it pays to seek out those experts with institutional knowledge, strong relationships, and a history of successful integrations.
3. Smart Cities – Operational Efficiency & Grid Resiliency
Asmart city is a city in which sensorsare deployed to collect electronic data from people and infrastructure to improve energy efficiency, sustainability, and quality of life. Utilities obviously have a huge role to play in smart cities, and DISTRIBUTECH’s “City of the Future” experience focused on connecting diverse groups of stakeholders and highlighting their needs to support growth and innovation – including topics like resiliency, reliability, infrastructure, digital transformation, urban operations, mobility, connectivity, and public-private partnerships.
The distribution grid is still uncertain – from city lines to low-voltage lines to how transformers react to an overloaded system – but smart cities seem to be a major focus for all energy companies seeking to improve operational efficiency and bolster grid resiliency.
Here are 3 things utilities can do right now:
- Assess, organize, and consolidate tech capabilities. Bringing data from disparate sources onto a common platform enables new methods of distributed intelligence and real-time analytics that will help bring smart cities online.
- For utilities without a data strategy, rely on external data to support grid modeling. Grid modeling simulates the behavior of an electric power system to help researchers understand the impacts of variability and uncertainty on power system operations.
- Engage the community. Utility companies must work with local governments to educate residents about the benefits of smart cities and some of the short-term tradeoffs.
THE NITTY “GRIDDY”
With 50% of the utility workforce set to retire in the next decade, utility companies are rapidly reskilling and hiring the next generation of talent. While larger utilities have the resources for special AI divisions to help onboard new technologies, the vast majority of smaller utilities will be reliant on outsourcing to third-party vendors.
But to be clear, automation is not reserved for the country’s largest and most innovative utilities. No matter the size or geography, every utility can benefit from an automation strategy and automation doesn’t necessarily require an outsized upfront investment. With the right partner strategy, automation is possible using the data infrastructure utilities already have.
AI was a core part of many of the discussions at DISTRIBUTECH, but in the utility industry, the use cases for AI are far more than just a cool technology. AI will truly be at the core of enabling the success of the daunting goals for electrification and the renewable transition. Events like DISTRIBUTECH will only get bigger and more important in the years to come, serving as a rising tide for innovation across the industry.
