Digital energy enterprise: A vision of enhanced industry efficiency, consumer confidence and technological reliability

By Mehrdod Mohseni, Tom Lonski, Rodney Dell, SchlumbergerSema

June 11, 2002 — The word “deregulation” has been a key part of the energy and utilities industries’ vernacular for the past few years. Although some of the effects of deregulation have been milder than once anticipated, deregulation has indeed played a significant role in changing some business practices, and it will continue to play an important role in driving regulated business reliability and efficiency targets.

This business driver, in addition to increasing customer expectations, will require strategic business transformation that effectively uses capabilities enabled by digital technologies. This new digital economy requires the conversion of old technologies and business trends into new digital enterprises.

E-commerce is playing a more important role in our industry, exposing customers, suppliers and partners to information that will drive operational efficiencies in the company – increasing reliability, reducing turn-around and response times and lowering costs. Recently’s vision of a digital energy enterprise must allow for information exchange across organizational boundaries of the disaggregating energy market. Additionally, utility companies must be able to approach customers with a best practice service model – a solution that streamlines interactions with the utility’s supporting business processes. Energy and utility companies that recognize these trends and work towards developing a digital strategy will be in a prime position to take advantage of the new digital economy.

The digital economy is revolutionizing customer expectations worldwide. Customers expect to take care of business whenever and wherever they want. Construction that used to take months or years to plan and implement is occurring in record speeds, allowing the utility companies very little time to plan for new energy requirements. With new modernized and computer-controlled equipment, even the slightest power flickers can wreak havoc with manufacturing plants. And with the explosion of information from normal day-to-day asset operational data to dynamic real-time data about the supply and cost of energy, utility companies are frantically searching for ways to harness and manage this information so that it can be utilized to everyone’s benefit.

Digital business transformation touches all aspects of an energy enterprise including business architecture and strategies, strategic business processes, management principles, systems functionality and integration, the management and flow of organizational knowledge and information and, finally, customer interactions. In order to take advantage of the new digital economy and its trends, the utility companies of the future must focus on developing a strategic technical and system architecture, along with a deployment plan, that enables incremental, return-on-investment-driven, business transformation and Information Technology (IT) initiatives.

These will provide the technical framework to coordinate and leverage not only their technical assets, but also their business processes and people. For transmission and distribution utilities, evolving spatial platforms and broader spatial application usage are areas of IT investment that can readily support incremental transformation and longer-term business and IT objectives.

This leads to the concept of an integrated data structure, which allows for normalizing data (a process by which data is standardized) across the front office, engineering and operations, and back office business processes and applications, while extending the overall Network Object Model (NOM) of a digital enterprise beyond the traditional geographical information system-based platforms.

Furthermore, it allows for the integrated energy and utility applications to be independent of specific vendor products.

There are several key processes within a utility’s core business practices that must be considered for a company to emerge as a digital energy enterprise, one of which is asset management.

The ability to optimize the maximum value from assets by defining the minimum asset life-cycle investment while ensuring acceptable quality of performance is of prime importance. Whether an organization owns and manages physical assets or is information-based, the spatial technology platforms of recently are a key strategic enabler for many distribution and transmission businesses, as well as other energy businesses within the disaggregated energy market, maintaining not only spatial relationships of assets but also network connectivity data.

An enterprise asset management (EAM) strategy provides a utility with the capability of managing their asset life cycle to meet the desired level of reliability at the lowest total cost of ownership possible. The correct EAM strategy also optimizes asset life-cycle investments that manage quality of performance risks.

At the core of the EAM trend is a decision support system (DSS) where information about assets from facility, work, and financial perspectives all come together to enable utilities to make short and long term investment decisions in an optimum way. At a minimum, the strategy should focus on the following:

* Optimal work planning that takes into account the life cycle cost implications of capital and O&M investment decisions and the criticality of the network location. This analysis should take into account the impact of component failures on the energy system reliability.
* Work definition, incorporating bid-units, that enables optimal work/contract assignment and execution of the work that has been planned.
* Optimal management of the asset location, connectivity, criticality, performance and cost information that will be managed in an asset repository for effective EAM decision-making.

Considering this strategy, the successful Digital Energy Enterprise will incorporate the following core components for its EAM solution:

* An asset investment planning system to optimize asset investment across capital and O&M investment opportunities.
* An asset repository that can link the operational information about assets with their financial information so that a true life cycle cost of assets can be tracked and leveraged.
* A spatially enabled network and asset database that will enable better and more efficient systems planning and reliability analysis.
* A focused inspection and maintenance system to track asset failures, condition, performance and cost of O&M at the asset level so that not only exception assets will be identified but also asset conditions will be monitored to maintain the desired reliability level and risk profile.

In summary, a digital energy enterprise is the vision of an IT environment that enables information exchange across the organizational boundaries of an energy enterprise within both the vertically integrated and the disaggregated energy markets. This vision is based on an integrated architecture and infrastructure that supports and extends to multiple domains across an energy enterprise operation.

At the heart of this integrated architecture and infrastructure lays the spatial platform that acts as the enabling framework to drive new application capabilities and related benefits opportunities.

These benefit areas range from integrated financial asset management (highlighted in this article), to intelligent energy network modeling, enhanced customer service and customer care and, finally, to business intelligence. Broader spatial application usage among these evolving spatial platforms is the key area of IT investment that can readily support incremental transformation and long-term business and IT objectives to achieve a digital energy enterprise.

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