The Integrated Utility of the Future: Transformation to Tomorrow’s Smart Energy Ecosystem

by Larry Kuhl, Microsoft

The power industry is on the cusp of a massive transformation to manage future economic and regulatory uncertainties, work force challenges and globalization.

New capabilities will empower the industry’s leading companies to welcome consumer participation, to anticipate price pressures and to face them head-on.

This transformation—aided by innovative information technology (IT)—will determine which utilities will successfully adapt to the smart energy ecosystem of the future.


Although electricity demand growth has slowed progressively since 1950, private-sector and U.S. government sources project demand to increase by 26 to 45 percent from 2007 to 2030. In combination with other market conditions, this increase is expected to stress the current energy industry infrastructure.

The transformation is a move to put the right technology infrastructure in place across the entire power industry value chain.

Although point solutions such as smart metering, mobile work force management and outage management are important elements of the overall solution, they don’t provide the full foundation.

The smart energy ecosystem spans everything from the power plant to the home, and therefore it is critical to connect business processes, systems, software, human interaction and assets across generation, transmission and distribution and customers. These connections create the integrated utility.

What does this transformation mean to utilities and their business and consumer customers, and what impact could they have on the world?

Data Becomes Usable With Smart Capabilities

Integration of utility systems across the enterprise is increasingly important as workers need instant access to information at the right time and in the right context and format.

The integrated utility of the future uses a combination of IT and operational systems that presents information to users based on their needs and defined business processes.

Within an integrated utility, role-based productivity allows utilities to leverage new unified communications, business intelligence, automated workflow, enterprise search and mobility capabilities tailored to each employee’s job function.

These capabilities give workers the ability to use and share data—and even analysis—to make better, faster decisions.

They also can collaborate to strengthen their interactions with customers, vendors and partners.

In this scenario, utility executives have real-time visibility across their enterprises, enabling faster and more informed decisions.

Technicians have access to asset history and the ability to search the enterprise for information concerning situations similar to those they face.

The best available resources are an instant message away through the power of presence without multiple phone calls or e-mails.

With role-based productivity technology, the fully integrated energy supply utility can run its power plants as a fleet to adapt to dynamic market conditions and increase availability vs. running as individual plants.

For example, a chief operating officer at a large, multinational utility uses a Microsoft SharePoint Server-based system that displays key performance indicators for plants throughout Asia all on the same dashboard.

With this system, he or she can see individual plant problems that could impact operations and profits at the same time or even before on-site plant managers see them.

Software-Plus-Services Improves Reliability

As demands on systems increase, integration utilitywide also allows companies to consider moving some data, applications and storage into the “cloud,” or Web.

Microsoft calls this mixture of on-premise and cloud-based computing “software-plus-services” (S+S) because it gives companies flexibility to maintain some processes and computing power on-site, while also leveraging the real-time nature of Web-based services.

For utilities, the move to an S+S platform can move many functions, from smart metering to customer systems into cloud services.

For example, smarter grid management solutions used in an S+S environment add communication and control capabilities, optimizing the electric grid and making it more efficient and reliable, said Jean-Michel Cornille, executive vice president for AREVA Transmission & Distribution.

“As a result, power companies will see fewer and shorter outages and shorter service restoration times as well as manage distributed generation from a variety of renewable energy sources—all of this with the active participation of their end customers,” Cornille said.

The main benefits of the S+S model include its ease of use and flexible data and systems architecture.

The flexible online-offline work environment it creates allows users secure and easy access from laptops or mobile computing devices via the corporate local-area network.

Adopting the S+S model makes it easy for large or expanding utilities because it requires limited on-site IT infrastructure and support and allows for quick deployment across operational jurisdictions.

Effective Emissions Compliance and Generation Mix Management

Integrated utilities also will implement an enterprise approach to emissions compliance and management that will provide the flexibility to keep up with the future’s dynamic regulatory landscape.

As requirements to monitor and report emissions become more rigorous, leading power companies are leveraging advanced IT solutions to automate data capture and integration and address reporting requirements.

American Electric Power (AEP), with about 5.1 million customers in 11 states, intends to use an environmental information management system to easily and accurately measure progress toward emission reduction targets.

John McManus, AEP’s vice president of environmental services, said that the goal is for workers to use the system to improve greenhouse gas, air and water reporting and compliance.

“The accurate and accessible emissions data and analysis will help us set reasonable targets and will help employees understand the big picture to meet reporting and permit requirements,” McManus said.

As utilities adopt more renewable sources, integration of real-time decision tools that allow them to more easily optimize and manage the overall generation mix becomes more important.

Real-time decision tools give the financial and carbon market perspective that will guide workers to an optimized generation mix that is fiscally and socially responsible—both necessities in the future’s smart energy ecosystem.

Alstom Power has seen a positive impact on emissions compliance and management with its customers who use the right software and processes, said Laurent Demortier, senior vice president of Alstom’s energy management business.

“The overall energy resource scheduling process will become more accurate with the opportunity to act on price-responsive loads similar to power plants, as well as truly account for CO2 optimization and capture in the process,” Demortier said.

Integrating Operation Support Systems Creates Opportunities to Streamline Work

On the power delivery side, new innovations such as integrated distribution management system tools integrated with smart metering solutions help companies improve grid reliability.

They also help operate the grid more closely to design limits, defer capital expenditures and reduce field and IT costs.

Most utilities have deployed and integrated their outage management and geographic information systems.

Fewer, however, have deployed or fully integrated their mobile work force management solutions with a more comprehensive distribution management system or asset management solutions, nor have they incorporated the notion of people presence.

People must have immediate access to the information they need in a way that it is easy to consume to facilitate better, faster decision-making.

Field workers should not wait inordinate amounts of time for searching and contacting the best available expert or other resources to immediately resolve a problem with a particular asset.

Ethan Boardman, product manager for AREVA’s integrated DMS solutions, has found that performance, interoperability and scalability are three of the top issues on which power companies focus.

“Integrated distribution management solutions give companies a suite of standards-compliant integrated products so they can control their grids, minimize interruptions for customers, keep track of whose lights are on and off and monitor committed resources and key performance indicators,” Boardman said.

Mobile workers have seamless access to mission-critical operations applications such as geographic information systems, which gives them real-time decision-making capabilities that keep the lights on while optimizing assets and reducing total operating and maintenance costs.

Where to Begin

Each utility has a complex technology mix, but all have the opportunity to integrate new capabilities and optimize work processes.

The first step to becoming a more fully integrated utility is to obtain the right infrastructure and architecture so that further integration is possible.

The infrastructure must be nimble in its ability to add new functionality, manage work flows, handle structured and unstructured information and unify human communications across the enterprise. Remember, this references integration from two high-level perspectives: application and human interaction.

Utilities are looking to leverage the common information model (CIM) to achieve application integration.

As more utilities deploy CIM as the application integration standard, additional software vendors will adopt it as the de facto standard, and more systems integrators will deploy it.

For communications, the ability to choose among e-mail, instant message, phone and the integration of these technologies with search and the notion of people presence will play an important role in optimizing worker productivity.

Now is a good time to discus within your company and with your technology partners how to improve business unit processes based on your current situation.

The recommended solutions should leverage existing technology. Adding new automation software will enable capabilities such as enterprise search, enhanced business intelligence and unified communications so that workers can make optimal decisions.

There is a dynamic, smart energy ecosystem on the horizon that companies can approach as a mandate or an opportunity.

Despite the global economic slowdown and other challenges, power and utility companies must be prepared to face this imminent but invigorating future.

By taking steps today, your utility will be better-prepared for the new, evolving, smart energy ecosystem as an integrated utility.


Larry Kuhl uses his nearly 30 years of utility industry experience to bring innovative solutions to utilities as Microsoft’s Worldwide Utilities business development and alliance manager. E-mail him at


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