By Guy Waterman, Infowave Software
Locating, reporting and managing the millions of assets that reside in the field has become a daunting challenge for utility companies due to increased regulatory reporting requirements, decreased investment in IT solutions over the past 15 years, and the need to support an aging infrastructure. Field technicians need a better way to collect and access asset information at the point of work, regardless of network availability, and they need more accurate data on current asset conditions to substantiate rate submissions.
Several issues have pushed the asset and network availability concerns to the front burner for utilities:
- The August 2003 blackout focused attention on the reliability and safety of T&D networks.
- Liability insurance costs are increasing based on the age and condition of distribution networks.
- SCADA systems are providing real-time status of the network to workers in dispatch centers, but this valuable information is evading the field workers who can also benefit from its access.
- Mobile workers are now interacting with information from multiple back-office systems as opposed to a single system as in the past. This is driving organizations to acquire next-generation mobile solutions that bridge enterprise operations.
- To meet regulatory reporting requirements and substantiate rate increases, utility companies must have more reliable data to accurately reflect current asset conditions. Using mobile applications to determine asset conditions and asset depreciation helps technicians meet these industry requirements.
These issues have driven utilities to adopt mobile computing solutions to improve their asset management operations.
To better understand the challenges currently facing regulated utility companies, it is important to review the events of the last 10 to 15 years and how they have impacted investment in IT solutions and physical assets. Following this review, it will become apparent that increased investment in solutions that enable organizations to better monitor, manage and maintain the utility delivery networks is imperative.
A Brief History of Under-investment
Market conditions have regularly affected the level of investment organizations make in their asset infrastructure. In good times, investment typically occurs at an accelerated rate; in down times, investment is tempered with the need to deliver value to investors and support growing portions of the business.
Looking back to the early 1990s, the utility industry was buzzing with the idea that deregulation would lead to improved competition among highly regulated utilities, and the resulting market forces would drive electric power prices down to a market-driven value. With the customer becoming the battleground for dominance in this new market paradigm, customer information systems (CIS) were targeted for replacement so utility companies and other energy providers could better manage existing customers while also adding new customers. With companies investing so much in these CIS applications, IT budgets for other parts of the organization were strained for years.
Shift the mindset to the late 1990s: Concerns over Y2K certification led utility CIOs to aggressively upgrade or replace many back-end systems. From ERP to EAM applications, the business again was seeing a tremendous investment in IT solutions focused on business processes as opposed to operations. Existing field systems were tested and ensured to be Y2K-compliant, but beyond that they were largely maintained at status quo. Investments in emerging mobile technologies were all but non-existent.
Fast-forward to the early 2000s: Market conditions dictated a spending imperative in energy marketing systems. After all, companies that had aggressively entered these markets were experiencing tremendous earnings, which translated to exploding valuations of their share prices. Investment in these real-time marketing systems picked up where the spending on Y2K initiatives left off. And, with returns in the regulated business managed to a 6 percent to 10 percent level, parent companies opted to increase their investments in energy marketing where they would see the best return.
During this time, utility operating companies were aggressively merged. Regulated arms of these utilities were either divested or segregated in order to not “drag down” the performance of the high-flying trading companies. There was an assumption that the reliable delivery of power and gas to the market would continue at low prices with the regulated infrastructure companies operating them. In fact, these regulated companies were struggling to keep up with new network expansions to support growth as the economy continued to expand. Investment in the delivery networks and systems that supported them continued to hover at an all-time low.
Then it happened. The bubble burst and companies were left with state-of-the-art trading centers that no longer delivered the triple digit returns of months prior. Projects attributed to Y2K system replacement were coming to completion, and companies were pressed to deliver the financial performance shareholders demanded.
Then, during a hot, mid-August afternoon in 2003, something happened on the network. Breakers popped as systems were not able to respond quickly enough to prevent what ended up becoming the most widespread and significant power blackout experienced in the United States and Canada.
Supporting a Renewed Focus on Reliability
Since the blackout, reliability, preparedness and security have become watchwords for utility delivery companies. The focus on network reliability is not a new concept, but the renewed focus is. The incentives are different now than they have been over the past 10 to 15 years. Public utility commissions are now more sympathetic to the network operators’ requests for increased investment in network reliability and safety, even if it means increasing delivery fees. Insurance companies are also joining in the effort (to avoid large losses such as those from the outage of 2003) by “sponsoring,” through lower premiums, the implementation of preventative measures that support network reliability. Inspections, improved maintenance programs and a more accurate view of the actual network in the field lead to lower claims paid out.
Additionally, properly accounting for the network’s status provides compliance with many state and local regulations. From Sarbanes-Oxley and other financial regulations to a myriad of safety regulations, it is imperative that electric and gas utilities be able to accurately value and quickly determine network status. Supporting these initiatives are mountains of data that need to be gathered and then continuously updated.
The burden of collecting and maintaining this data falls squarely on the field organization. From inspection orders to maintenance work orders, field workers are increasingly called upon to gather more meaningful information to accomplish the company’s accounting, operational and regulatory compliance objectives.
Enterprise Mobile Computing
Mobile computing is not a new technology for utilities. However, utility organizations have not often addressed the enterprise rollout of a single mobile strategy for all field computing needs. It was not until recently that capable technology existed to connect to multiple back-end systems and provide access from multiple device types.
Deploying an enterprise-wide mobile strategy enables a utility company to automate more of its workforce than has traditionally been cost-effective to achieve. With the added burdens of collecting more information about operations and data associated with the network, the enterprise should enable as many field resources as possible to maximize worker productivity.
Processes supported by mobile computing currently encompass all field operations in an electric and gas utility organization. Mobile computing supports the following processes:
- Tool and equipment management. Mobile computing supports the proper issuance, tracking and return of special equipment assigned to work tasks.
- Mobile work management. Mobile computing assists in the distribution of maintenance, work management and related information to the field.
- Asset configuration management. Mobile computing enables infrastructure management to be performed at the site where assets are deployed, which improves the accuracy of the “as built” to “as documented” information database. Knowing where assets are deployed impacts accounting issues regarding asset life. Accounting and depreciation elements contribute to compliance with the Sarbanes-Oxley Act.
- Asset locating. Assets can be inventoried and compared immediately to the ‘as documented’ records, which, again, aids in compliance with the Sarbanes-Oxley Act.
- Asset inspection and maintenance. Inspection programs have come under increased scrutiny due to the added requirements imposed by the DOT, EPA, OSHA, and Department of Homeland Security.
- Permitting. Site access, right of way, and system tagging permits can be automated and executed in real-time, eliminating costly delays while preserving regulatory compliance.
- Document access. The ability to search and retrieve schematic documents, approved procedures, and other information in the field is critical to getting work done.
- Supply chain integration. Field access to material catalogs enables the reduction of field inventory through the implementation of automated replenishment programs and delivery of requested parts to the work site.
- One-call locates. Enterprise mobile computing can provide an integrated environment for utility field workers and contractors to receive and clear locates as they are called in by contractors and land owners.
- Customer connection and disconnection of service. As part of the overall field service solution, mobile computing can be connected with existing scheduling and dispatch applications.
Mobile Computing is Key
Network support systems have felt the pinch of minimal investment for a number of years. Significant improvements in supporting systems–including mobile computing–have been delivered to the market and represent tremendous value to the utility organization if those systems are properly deployed.
Recent events now require utilities to gather additional information about their infrastructure to support regulatory reporting, to submit rate cases with the appropriate justification, to take advantage of reduced insurance premiums, and to implement programs that will aggressively drive down the cost of maintaining the network while improving reliability. Deployment of enterprise mobile computing solutions can enable utility organizations to more quickly realize the benefits attributed to this complex business opportunity.
Guy Waterman is vice president of corporate strategy for Infowave Software (www.infowave.com), a company that provides enterprises with scalable mobile solutions for improving operational efficiency and increasing the productivity of mobile workers.
Value Propositions for Enterprise Mobile Computing
Mobile computing solutions can help utility companies:
- Improve overall operational performance.
- Address regulatory requirements.
- Accurately record capital depreciation events. (As equipment comes on and off line, update financial systems appropriately.)
- Perform asset conditioning assessments and inspections.
- Streamline sourcing and procurement. (Track parts throughout the supply chain to reduce over-ordering & over-stocking.)
- Decrease capital expenditures through preventive and predictive rather than reactive maintenance.