Study: Utilities embracing cloud, almost all use or plan to use cloud technologies

People talk about the cloud in terms of the distant future and many think utilities are slow to get on board — but new research shows 45 percent of utilities currently use the cloud, and 52 percent plan to use the cloud. What’s more, 69 percent of utilities already use or plan to use cloud technologies for their customer information systems in the next three years.

According to the new Oracle Utilities “On Cloud Now: Cloud Technologies are Here for Utilities” study, larger utilities appear to be the earliest adopters (72 percent), with small and mid-sized utilities following suit (50 and 23 percent, respectively). Survey respondents indicated that they are considering both software-as-a-service and private cloud/hosting solutions as they transition to the cloud.

“The survey results signify a milestone for the industry — a fundamental change in how utilities are approaching their technology investments. Technology that used to be characterized by large homegrown systems managed by internal utility staff is transforming into more nimble partnerships with external providers,” said Rodger Smith, senior vice president and general manager, Oracle Utilities.

With the rise of distributed energy resources, a smarter grid, and the need for more advanced analytics, technologies for utilities continue to become increasingly sophisticated and complex. Data is growing exponentially, and technologies that previously lasted for decades are now becoming obsolete.

Nearly 50 percent of survey respondents listed keeping pace with technology changes and improving their flexibility as key drivers for their cloud investments. The cloud enables them to reallocate funds once required to upgrade and replace their legacy systems.

Many of the technologies that utilities are taking to the cloud today revolve around smart grid efforts and next-generation technologies — including meter data management, big data analytics, and distribution automation and network management. Utilities are also seeing opportunities for transformation in more traditional areas of the organization — customer information systems, mobile workforce management, and enterprise resource management.

Finally, while most utilities are already embracing the cloud, the study found that privacy, control, security, and system integration still cause them hesitation. Respondents rated their concern on a scale of one to five, where five indicated significant concern. Privacy earned a rating of 4.31, closely followed by control (3.90) and security (3.89).

“These concerns point to the need to ask technology and service providers the right questions about cloud technologies, and truly understand their approaches and plans,” said Smith. “Begin building your cloud strategy now — determining how to prepare for and leverage the cloud; align business and IT to ensure successful deployment; and talk with your cloud provider — ask questions and challenge prospective providers on their approaches to the cloud. With these steps, the cloud provides utilities a path for transformation into a more nimble, flexible organization that can better adapt to today’s changing marketplace.”

Conducted by research firm Zpryme on behalf of Oracle Utilities, the Oracle Utilities “On Cloud Now: Cloud Technologies are Here for Utilities” study surveyed 100 electric, gas, and water utility executives and directors about their cloud objectives.

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