- Software as a Service
- Distribution Management System
- Digital Future of Utilities
- Data Analytics
Software Strategies for Targeting Cooperative and Public Utilities
The cooperative and public utility market has been traditionally underserved within the electric power industry. This lack of targeted marketing by vendors is not too surprising; cooperatives and public utilities tend to be much smaller than their investor-owned counterparts, and they often lack the financial and human capital resources of larger investor-owned utilities. While these business constraints can introduce additional cost and deployment challenges, vendors should be capitalizing on these opportunities rather than shying away from them.
The market landscape is finally showing signs of adjusting, as vendors are exploring more flexible and modular solutions to target these lower tier markets. Three key strategies being advanced by top software vendors today to capitalize on these emerging services include the following:
- Software as a Service (SaaS): One of the biggest industry megatrends over the past 3-5 years has been the growing acceptance of cloud-based and managed service models. Initially popular across non-critical applications like meter data management (MDM) and analytics, SaaS has grown to encapsulate billing, workforce management, asset management systems, and more.
Control systems present the last frontier for SaaS—a major way for vendors to differentiate from the pack. While some utilities still balk at the idea at giving up their security and control, these concerns have subsided in recent years. Vendors are already stepping up to the table, as evidenced by several full-blown control systems deployed as a service, including a distribution management system (DMS)/SCADA offering from Open Systems International (OSI).
- Microservices: At a system architecture level, vendors are exploring microservices to open new market opportunities. Applications designed under a microservices architecture are developed as autonomous, loosely coupled services. These services are less complex and smaller since they generally focus on a single functionality centered around a business capability. This facilitates more solution flexibility and enables faster, non-centralized upgrades to keep up with changing market conditions.
For example, a full-fledged advanced DMS (ADMS) or distributed energy resources management system (DERMS) is often unnecessary for lower tier utilities; they may only require baseline or tertiary functionalities. Microservices architectures allow for more flexible, piecemeal software adoption. ABB and Oracle are two major vendors offering microservices-based control systems.
- Analytics Alternatives to Core IT: While cloud computing and microservices focus on alternative architectures and deployment models for advanced IT systems, some vendors are trying to bridge the gap with alternative technologies. Data analytics is one of the primary alternatives being leveraged by lower tier utilities to defer investment in systems like ADMS (DMS/OMS [outage management system]/SCADA/DERMS), MDM, and asset monitoring. For example, NV Energy was able to defer investment in a full-fledged ADMS via a grid monitoring platform utilizing inductively-powered sensors and a software package with predictive system analytics.
Software Utilization on the Rise
From the cooperative and public utility side, companies are willing to explore more advanced solutions. In fact, cooperatives hold the highest penetration of smart meters across all utility types in the US at nearly 75% at the end of 2019. This demonstrates and advances the market for value-added software solutions, which can maximize the value of advanced metering infrastructure and other sensor data (e.g., ADMS, customer information systems, MDM, analytics).
A handful of software vendors are already marketing their solutions to these lower tier markets, including OSI, the National Information Solutions Cooperative, and Survalent. This trend is finally making waves among larger vendors, with enhanced targeting initiatives now coming from most major utility software providers. What has traditionally been an underserved market is now primed for opportunity and differentiation. Who will take advantage of these opportunities?