2Q 2017

Defining the Digital Future of Utilities

This white paper complements Guidehouse Insights’ existing research into the development of the Energy Cloud. It builds on discussion in Guidehouse Insights’ Navigating the Energy Transformation white paper on an aggressive Energy Cloud scenario. In this scenario, distributed energy resources (DER), which include solar PV, energy storage, and EVs, are near ubiquitous. The same is true of transactive energy (TE), whereby DER owners can trade their self-generated power. In addition, utilities rely heavily on machine learning and analytics-driven automation to manage the grid.

By 2030, the future utility value chain will have transformed significantly. Guidehouse Insights argues that current distribution network operators will have transformed into distribution service orchestrators; they will be responsible for far more than just network operations. Likewise, the current energy supply business—already transitioning to a service-based model—will be fully transformed into an energy service provider (ESP) model. Companies will offer end-to-end energy services that have little in common with today’s volume-based approach to revenue generation.

This Guidehouse Insights white paper provides an overview of the opportunities and challenges that the industry will face during the transition to an intelligent and distributed future. The resulting new business models will require new IT infrastructure that relies heavily on the analysis of huge volumes of data. Distribution orchestration platforms will rely on the integration of existing advanced distribution management systems and DER management software, as well as the incorporation of a market pricing mechanism to reflect the changing value of millions of connected endpoints throughout the day. ESPs will rely on transactive energy platforms that enable prosumers to sell their power into the market, incorporate customer portals to provide in-depth account details, and provide billing and settlement functionality.

Pages 38
Tables | Charts | Figures 17

  • What will the energy market look like in 2030 based on Guidehouse Insights’ aggressive Energy Cloud scenario?
  • What will a future energy service provider’s (ESP’s) business model look like?
  • How will existing distribution networks business transform to manage near ubiquitous distributed energy resources (DER)?
  • What IT infrastructure will support an ESP’s business model?
  • What IT infrastructure will support a distribution system orchestrator’s business model?
  • What should utilities do to prepare for a transactive energy future?

  • Utilities
  • Advanced distribution and DER management system vendors
  • Billing and customer portal vendors
  • Smart grid hardware vendors
  • Regulators
  • Governments
  • Investor community

1. Executive Summary

1.1   Future Utility Value Chain of 2030

1.2   Intelligent and Distributed Future

2. The 2030 Utility Value Chain

2.1   Fast Forward to 2030

2.2   Cash, Electron, and Data Flows within the Energy Cloud

2.3   Customer Centricity, Customer Choice, and the Shift to Energy Services

2.4   ESPs Were Created after a Sustained Period of Disruption

2.5   ESPs Own the Customer Relationship

2.6   ESPs Provide Customer Choice through Multiple Services

2.7   Distribution Service Orchestrators Manage the Electricity Infrastructure

3. Platforms Create Access to the Market in 2030

3.1   Technology Infrastructure

3.2   TE Platform

3.2.1   TE Platforms Provide an Automated Trading Platform for Customers in 2030

3.2.2   TE Platforms Support Advanced Customer Portals

3.2.3   TE Platforms Must Also Support Billing and Settlement

3.3   Distribution Service Orchestrators Require Distribution Orchestration Platforms

3.3.1   DMS, Market Pricing, and DERMS Technologies Converge

4. Data Is the Key Market Differentiator

4.1   Data Flows Are as Important as Power Flows in 2030

4.2   TE Platforms Have Significant Data Requirements

4.3   Al Algorithms Choose the Most Favored Path for Customers

4.4   Aggressive Energy Cloud Scenario Requires Powerful Analytics

4.5   Distribution Service Orchestrators’ Data Management in 2030

4.6   Data Collaboration, Security, and Privacy in 2030

5. Back to the Present: Recommendations for Utilities in 2017

5.1   TE Could Be the Catalyst for Rapid PV Growth

5.2   Customers Sit at the Heart of the Future Energy System

5.3   Long-Term Strategy Must Be Sufficiently Flexible to Accommodate Change

5.4   Digital Transformation Is Central to a Flexible IT Roadmap

5.5   Treat Data as the Most Valuable Asset

5.6   Upskill to Meet Future Challenges

6. Acronym and Abbreviation List

7. Table of Contents

8. Table of Charts and Figures

9. Scope of Study, Sources and Methodology

  • Customers Sit at the Heart of the Energy Cloud in 2030
  • The Industry Relies on the Flow of Cash, Electrons, and Data
  • Flows of Cash, Electrons, and Data Are Bidirectional between Multiple Stakeholders
  • Control of Flows Shifts from Suppliers and Generators to ESPs, Customers, and Distribution Service Orchestrators
  • Key Stakeholders in the 2030 Energy Cloud Value Chain
  • ESPs’ and Distribution Service Orchestrators’ Business Models and Technology Platforms
  • Residential Premises Are Highly Connected in 2030
  • ESPs Evolved through the Consolidation of Multiple Services
  • Balancing Comfort, Cost, Profits, and the Environment in 2030
  • Customers’ Order of Preference for Buying the Cheapest Electricity in 2030
  • A TE Platform Connects Prosumers and Customers with Other Stakeholders
  • Storage and TE Flatten Duck Curve Peaks (Indicative)
  • The Transactive Energy Platform Technology Stack
  • The Value of Data Relates to the Value of Underlying Business Processes
  • The Energy Cloud Playbook

  • Different Applications Rely on Data from Multiple Sources
  • Different Data Types Require Different Data Strategies