The Energy Market and the Internet of Things

Graeme Wright
By , - InnovationEnergy & Utilities

In this new series, Fujitsu’s Utilities expert Graeme Wright will be taking a look at five factors poised to make a big difference to the Energy market. First – the Internet of Things.

home IOT

The utilities industry is slowly but surely reaching a tipping point of technology and structural change.  The pressure is high to deliver greener energy and reliable supply, whilst maintaining value for money for customers.  Technology will play a key role in meeting these demanding needs – in particular, the Internet of Things.

Smart devices and networks promise many benefits for suppliers, by enabling intelligent generation, distribution, usage and storage of energy closer to the point of consumption.  And increasingly, they’re being used inside the home for energy management and home automation.

Today’s customers are used to managing their digital lives seamlessly – whether banking with a smartphone app, or checking in for a flight online.  They demand an equivalent experience for their energy management and many systems – HIVE, NEST, and Apple along with others – have been developed to meet this need.  These offer consumers granular control of their energy usage and, in turn, better awareness of just how much they are using.

These systems are currently DIY solutions, but falling costs and the adoption of new business models will see market consolidation around standards, such as Google’s Thread – at which point adoption will rapidly increase.  It will only take one big-name brand to create a robust, connected home system to bring this long-running dream to fruition; whether the winners in this market will be Apple, Google, Microsoft or a new entrant as yet unknown.

The real transformation point, however, will come when information can be shared between consumer and non-consumer devices.  Intelligent homes will “know” when it would be cheaper to use energy for heating water or charging the family electric vehicle.  If that data can be shared with a smart generation and distribution network, the system can be optimized to drive up efficiency, reduce costs – and reduce environmental impact too.

Utility companies who take a lead in integrating these technologies will reap the rewards – both in real operational efficiencies, and in delivering a far better experience for their customers.

However, this will not be without challenges.  Utility companies already depend on a wide variety of technology, ranging from generation and distribution systems through to customer service and billing.  To take full advantage of the Internet of Things, suppliers will need to take a holistic view of their technology landscape, introducing the new capabilities of smart devices in alignment with business change and legacy modernisation programmes.

Perhaps the most important consideration is security.  With even simple devices able to sense and share information, the risk of data leaks and security breaches increases dramatically – as this report from the BBC illustrates.  Security is of paramount importance to protect reputation and maintain customer trust.

These challenges can be overcome by putting security at the heart of technology improvement – something often overlooked when rushing to take advantage of new capabilities.  Retro-fitting security is never easy and is usually very expensive, both financially and in terms of reputation.  Many organisations are already struggling with security before the challenges raised by the Internet of Things, so resilience needs to be put in place now with a view to enabling later, but more secure, adoption.

Graeme Wright

Graeme Wright

CTO for the Manufacturing, Utilities, and Services, UK and Ireland at Fujitsu at Fujitsu
Graeme Wright

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