It is no exaggeration to say that the utilities industry is at a critical point in its history. Every move is being scrutinized closely, whether it falls under a big-picture category like environmentally friendly practices, or down to the level of the amount a residential customer pays in their monthly bill.
Data is at the heart of every decision that needs to be made by stakeholders in the industry. Here’s a look at what some of those decisions are, and the critical role data and analytics has to play as the utilities industry moves forward.
Energy sources
One of the major issues the utilities industry faces right now is meeting an increasing demand for energy. Infrastructure is aging and organizations need to weigh the cost of a complete upheaval versus modifications to existing structures. There are a number of factors contributing to the increased demand for energy. The rising popularity of electric vehicles is one, and another is the increased dependence on artificial intelligence (AI). The data centers that power AI consume a lot of energy, and that usage is trending upward. A recent report finds that data centers consumed about 4.4% of total U.S. electricity in 2023 and are expected to consume approximately 6.7% to 12% of total U.S. electricity in 2028.
That has technology companies looking to be creative with their energy sources. With an eye on their sustainability goals, they are looking to use solar, hydrogen, and nuclear energy to try to reduce emissions. Not all carbon emissions are being reduced, though. Some utilities argue that rising demand for electricity has forced them to keep their coal-burning power plants operating past scheduled retirement dates.
Using analytics to guide decisions
This is where analytics might tell a different story. A 2023 study showed that 99% of all U.S. coal plants are more expensive to run than replacement by new renewable energy sources such as solar or wind. The required upkeep is part of the reason Michigan actually accelerated the closing of some of its coal plants, in addition to other reasons like clean water and coal waste disposal regulations. One Michigan plant scheduled to close in 2026 will be replaced by natural gas. While natural gas is not as environmentally friendly as other sources such as solar or wind, it can be more wallet-friendly for customers. The utility company that operates the plant predicts that the transition will save customers almost $600 million.
These are the kinds of decisions utilities are relying on the data to make. Another is how to help an aging grid meet the increasing demands. Many utilities have been able to deploy grid-enhancing technologies and advanced conductors that can add capacity without the cost of rebuilding an entire system. For example, a Virginia-based utility company replaced 800 miles of lines with ‘high temperature low sag’ conductors, which increased capacity by about 50%. The replacements not only increase capacity, but they can help avoid the types of natural disasters, like wildfires, that the current grid is susceptible to in some areas.
There can be an overwhelming amount of data that utilities organizations need to sort through to make the best decisions both for their business and their customers. Organizations need a reliable analytics solution that can be customized for their individual needs and explore large data sets to offer insights that were previously unattainable, leading to better business decisions.
With so much happening in the utilities industry, an organization needs every advantage it can get to stay on top of every change that occurs, whether that is in regulations from the authorities or the way energy is delivered. The right analytics solution can provide that advantage to help utilities companies make their way through this pivotal period.
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