Industry Insights
Industry Predictions: Where Challenges and Opportunities Reside
February 05, 2020
DISTRIBUTECH 2020 is one of our industry’s leading events, and this year it did not disappoint. The conference delivered an impressive line-up of thought leadership, innovation and education on the most important topics facing our industry.
I had the privilege of addressing attendees as one of the keynote speakers. It was an energizing experience to kick off the conference with our industry predictions, and to precede the second keynote from my inspirational colleague, Paula Gold-Williams, president and CEO of CPS Energy / Itron customer.
As a company, we are helping create a more resourceful world through innovation and technology. Heading into this new decade, there is so much opportunity across the industry brought on by new technologies and greater efficiencies. But, there is also caution, as the dynamic forces of aging infrastructure, environmental challenges and an evolving society shape how we move forward together.
Here are our five predictions for our industry:
Natural Disasters—since 1970, the number of annual disasters worldwide has quadrupled to around 400 a year, and it shows no signs of letting up. Unfortunately, it seems that these events are inevitable, and they appear to be happening with greater frequency and intensity. As a community of energy and water providers, we have no choice but to prepare for what is coming. Grid management, reliability, resiliency, safety and security will remain top priorities given this “new normal.”
Exponential Proliferation of Electric Vehicles—electric vehicles (EVs) are poised to greatly impact the grid. EVs are set to make up more than half of global passenger car sales by 2040. Last year was a record-breaking year for global EV sales, increasing 68% year-over-year, and rising to a total global stock of 5.12 million. This increased demand creates a need to more accurately forecast and use energy. For example, by monitoring AMI data streams, utilities could determine which homes have EV capacity and how many vehicles are being charged to avoid overloading local transformers.
Dramatic Increase in Diversity of Energy Mix—installed renewable energy capacity in the U.S. is set to increase to 443GW by 2030 – double the current capacity – according to a study by research firm Global Data. When Itron asked utilities about their grid modernization investment priorities, integration of renewables was their top priority. Additionally, it's becoming increasingly more economical to add battery storage to new renewable energy projects. This increase in renewables and distributed generation will impact utility operations, requiring that utilities leverage unique data streams to determine more short-term forecasting mechanisms.
Utilities Will Play a Pivotal Role in Cultivating Smarter Cities and Communities—urbanization of the global population is increasing, with the U.N. predicting that more than 67% are living in urban centers. As cities continue to grow at a very fast pace around the world, their strategies around digital transformation are maturing and generating interest in smart city programs. According to Navigant Research, the annual utility revenue opportunity in smart cities is expected to grow from almost $45 billion in 2018 to more than $100 billion by 2027. Smart cities offer a host of economic and societal opportunities, and innovation in technology along with public private partnerships will be key to putting smart city programs in place.
Distributed Intelligence Will Transform the Energy Industry— 30 to 35 years ago, utilities had virtually no visibility into the distribution grid. Fast forward to today, some utilities remain largely blind, on a real-time basis, to conditions within the distribution network and have minimal ability to manage rapidly changing conditions at the edge of the network. Distributed Intelligence (DI) is a game changer in this area. Applications running on the end device provide insight and control, bringing significant value on top of the operational benefits gained from an AMI network.
These five predictions are singularly and collectively intertwined with issues that we continue to see in the news and work on together, as challenges and opportunities reside in them all. We also see some offshoots in the areas of shared networks as cities and utilities solidify business models that allow more businesses to take advantage of overlapping utility network infrastructure footprints. And as water crisis concerns mount globally, water utilities will be compelled to improve control of water losses. Technology will also lead us to improved optimization and customer engagement – this is a key focus for Itron Idea Labs. In the coming year, Itron Idea Labs will focus on applications such as utility distribution optimization, distributed energy resource management, energy and carbon reduction, and solar energy prediction.
It's an exciting and evolving time for our industry. As a company, we are committed to innovating how utilities and cities manage energy and water worldwide. DISTRIBUTECH 2020 brought us together to collaborate on how to do better – and Itron is ready to meet the challenges of the decade ahead. Together, let’s create a more resourceful world.
I had the privilege of addressing attendees as one of the keynote speakers. It was an energizing experience to kick off the conference with our industry predictions, and to precede the second keynote from my inspirational colleague, Paula Gold-Williams, president and CEO of CPS Energy / Itron customer.
As a company, we are helping create a more resourceful world through innovation and technology. Heading into this new decade, there is so much opportunity across the industry brought on by new technologies and greater efficiencies. But, there is also caution, as the dynamic forces of aging infrastructure, environmental challenges and an evolving society shape how we move forward together.
Here are our five predictions for our industry:
Natural Disasters—since 1970, the number of annual disasters worldwide has quadrupled to around 400 a year, and it shows no signs of letting up. Unfortunately, it seems that these events are inevitable, and they appear to be happening with greater frequency and intensity. As a community of energy and water providers, we have no choice but to prepare for what is coming. Grid management, reliability, resiliency, safety and security will remain top priorities given this “new normal.”
Exponential Proliferation of Electric Vehicles—electric vehicles (EVs) are poised to greatly impact the grid. EVs are set to make up more than half of global passenger car sales by 2040. Last year was a record-breaking year for global EV sales, increasing 68% year-over-year, and rising to a total global stock of 5.12 million. This increased demand creates a need to more accurately forecast and use energy. For example, by monitoring AMI data streams, utilities could determine which homes have EV capacity and how many vehicles are being charged to avoid overloading local transformers.
Dramatic Increase in Diversity of Energy Mix—installed renewable energy capacity in the U.S. is set to increase to 443GW by 2030 – double the current capacity – according to a study by research firm Global Data. When Itron asked utilities about their grid modernization investment priorities, integration of renewables was their top priority. Additionally, it's becoming increasingly more economical to add battery storage to new renewable energy projects. This increase in renewables and distributed generation will impact utility operations, requiring that utilities leverage unique data streams to determine more short-term forecasting mechanisms.
Utilities Will Play a Pivotal Role in Cultivating Smarter Cities and Communities—urbanization of the global population is increasing, with the U.N. predicting that more than 67% are living in urban centers. As cities continue to grow at a very fast pace around the world, their strategies around digital transformation are maturing and generating interest in smart city programs. According to Navigant Research, the annual utility revenue opportunity in smart cities is expected to grow from almost $45 billion in 2018 to more than $100 billion by 2027. Smart cities offer a host of economic and societal opportunities, and innovation in technology along with public private partnerships will be key to putting smart city programs in place.
Distributed Intelligence Will Transform the Energy Industry— 30 to 35 years ago, utilities had virtually no visibility into the distribution grid. Fast forward to today, some utilities remain largely blind, on a real-time basis, to conditions within the distribution network and have minimal ability to manage rapidly changing conditions at the edge of the network. Distributed Intelligence (DI) is a game changer in this area. Applications running on the end device provide insight and control, bringing significant value on top of the operational benefits gained from an AMI network.
These five predictions are singularly and collectively intertwined with issues that we continue to see in the news and work on together, as challenges and opportunities reside in them all. We also see some offshoots in the areas of shared networks as cities and utilities solidify business models that allow more businesses to take advantage of overlapping utility network infrastructure footprints. And as water crisis concerns mount globally, water utilities will be compelled to improve control of water losses. Technology will also lead us to improved optimization and customer engagement – this is a key focus for Itron Idea Labs. In the coming year, Itron Idea Labs will focus on applications such as utility distribution optimization, distributed energy resource management, energy and carbon reduction, and solar energy prediction.
It's an exciting and evolving time for our industry. As a company, we are committed to innovating how utilities and cities manage energy and water worldwide. DISTRIBUTECH 2020 brought us together to collaborate on how to do better – and Itron is ready to meet the challenges of the decade ahead. Together, let’s create a more resourceful world.