Utilities & Decarbonisation

Johnston ... by embracing AI and automation, the EU&R sectors can emerge as leaders in efficiency and sustainability.

Johnston ... by embracing AI and automation, the EU&R sectors can emerge as leaders in efficiency and sustainability.

Emerging tech set to reshape EU&R sectors

The Energy, Utilities and Resources (EU&R) sectors continue to prioritise digital transformation to drive operational efficiencies while meeting the growing demand and tackling climate change. CAROL JOHNSTON of IFS* offers valuable market insights into the industry, and outlines the top three trends that will have a profound impact on these sectors.

01 March 2024

Emerging intelligent technologies are poised to significantly transform the Energy, Utilities and Resources (EU&R) scene in the coming years. However, these sectors are facing a unique and complex landscape abounding in challenges and opportunities.  In the Arabian region, there is a transformative shift towards diversification and sustainability as the industry focuses on meeting the growing rise in energy demand and tackling climate change. The extensive emphasis on increasing operational efficiency and business value is driving the sectors towards incorporating innovative and advanced technologies in business processes.

By embracing AI and automation, the EU&R sectors can navigate the interesting journey ahead and emerge as leaders in efficiency, sustainability, and excellence. There are three key trends that are emerging in these sectors:

 

• Demand for integrated systems with embedded AI and automation will increase by 50 per cent: Digital transformation continues to be a central point of focus for the industry. In a recent PWC report, "digital transformation" ranked second only to hiring and retaining talent as a top growth driver for the industry. Some 59 per cent of EU&R companies are increasing investment in digital transformation initiatives.

This makes good sense, especially with the rapid adoption of AI, IoT, and other intelligent technologies.

The EU&R sectors will continue their evolution towards a composable, integrated environment, one that is capable of supporting the innovation and rapid change under way within the industry.

While many organisations already rely on system data to help inform business insights, intelligent, integrated systems will drive new use cases this year.

No longer limited to supporting "go/no-go" decision-making, intelligent systems will generate plans and recommendations to address disruptive events (outages, sick leave, supply chain issues, etc.) before productivity is impacted. The approach is comprehensive, identifying possible constraints (limited parts inventory, resourcing, etc) and other considerations within the proposed response.

For example, an intelligent system uses data from an asset performance management (APM) solution to flag that an asset is likely to fail within the next three months. Along with an alert of the impending failure, the system also utilises data from other modules (scheduling, ERP, etc) to make resource and scheduling recommendations that optimise uptime and lower overall costs.

Another example is where the parts inventory is insufficient, or the necessary components are located at a different facility. The system factors this into the schedule, along with supply chain constraints, so there is adequate time to ensure all of the required parts and people are available for the planned work.

IFS customers leverage a data-rich environment with insights to assets, skilled workforces, parts inventories, and additional considerations – such as carbon footprint reduction and other enterprise KPIs that impact decision-making.

These integrated systems have access to full operational intelligence to ensure the business maintains and optimises productivity while delivering on its commitments across the enterprise.

 

• Water management will become a business imperative in 2024, with sensor and smart meter deployments increasing by 100 per cent: Clean, potable water isn’t a privilege; it is a life necessity. With only 0.5 per cent of water on the planet useable and climate change dangerously affecting the supply, managing this resource is one of the industry’s most important responsibilities.

Yet, according to the Federal Energy Management Program, the US loses 2 trillion gallons of treated drinking water yearly, often due to undetected leaks in  water mains that were not adequately maintained.

Without immediate and effective management, our water supply will continue to shrink.

The industry will be under increasing pressure to manage the water supply proactively, with smart meter deployment increasing substantially to improve leak detection. This will result in an increase in revenues which can be invested in new infrastructure and technology by utilities.

IFS utility customers are implementing a range of strategies to combat water scarcity:

•  Reduce water usage and waste;

•  Develop water filtration systems.

•  Protect wetlands;

•  Improve irrigation efficiency;

•  Increase water storage in reservoirs; and

•  Desalinate seawater.

Utilities must also teach communities and businesses to become better stewards, sharing best practices to conserve water, including oversight to curtail excessive use and ensure demand doesn’t exceed supply.

 

• Carbon capture and storage (CCS) practices will increase by 30 per cent: The planet’s future is at risk due to global warming and climate change, primarily driven by greenhouse gas emissions. According to the Paris Agreement, global warming must not exceed 1.5 deg C above pre-industrial levels. However, the planet is already 1.1 deg C warmer and emissions continue to rise. To achieve the target, emissions must reduce by 45 per cent by 2030, reaching net zero by 2050.

Unfortunately, experts are already predicting our current efforts will not be enough. A recent International Energy Agency (IEA) report advises that the path to net zero is narrowing, requiring greater ambition and implementation, with stronger international cooperation to turn things around.

This year, we will see new practices implemented in an effort to get us back on track – specifically, on carbon capture and storage (CCS). According to the Environmental and Energy Study Institute, increasing the storage and recycling of CO2 are critical imperatives to stabilise the climate for continued human development.

CSS involves the capture of carbon dioxide (CO2) emissions from industrial processes, such as steel and cement production, or from burning fossil fuels in power generation. The carbon is transported from the point of production (via ship or pipeline) and stored deep underground in geological formations to prevent it from returning to the ground surface or seabed.

Within the industry, some power plants have already implemented CCS strategies.  The success of these progressive CCS programs relies on a unified cloud platform, capable project management, and technology that precisely tracks ESG objectives in real time to meet carbon reduction goals.

IFS customer Hafslund Oslo Celsio, Norway’s largest district heating and cooling provider, selected IFS Cloud to help it reach its climate goals. The technology will drive efficiencies across its green energy production processes, develop carbon capture and storage capabilities, and reduce waste.

 

Navigating what lies ahead:

The Energy, Utilities and Resources sectors have an interesting journey ahead of them. With critical developments at play, like global warming and the effects of a shrinking water supply, they must actively incorporate AI and automation into their organisations.

By leveraging these technologies, organisations in the EU&R sectors will be well-equipped to strategically utilise operational intelligence across all areas of their operations. This will enable them to not only maintain optimal levels of productivity but also demonstrate a strong commitment to excellence and success across the enterprise, while driving forward sustainable practices.

 

* Carol Johnston is Vice-President of Energy Utilities and Resources at IFS, a Sweden-based firm that offers the next generation of cloud-based enterprise software for companies all over the world.




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