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2010.04.12

CSC study foresees more opportunity as grids get smarter

FALLS CHURCH, Va. --(Business Wire)-- A study released today by CSC found that business and IT executives at the top 20 utilities and retail energy providers worldwide are finding opportunities for growth as new smart utility and meter-to-cash advancements are unveiled. Participants of the 2010 Smart Utility and Meter-to-Cash Study reveal that there is optimism in the utilities sector about implementing new technologies to support the “smart grid,” but that the business processes to support them are just beginning to take shape.

The study, commissioned by CSC and conducted by leading analyst firm, IDC Energy Insights, in the winter of 2009-2010, queried business and IT executives from leading utilities from Australia, China, the United Kingdom and the United States about their major initiatives, objectives, expected payback, readiness and challenges. IDC Energy Insights is a division of International Data Corporation (IDC), the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets.

Responses indicate that smart utility and meter-to-cash technologies are creating significant amounts of data and analytics for customer intelligence, which allows utilities to study consumer reaction to pricing, identify potential revenue leakage, forecast customers’ ability to pay and limit unbilled usage through move-in/move-out disconnections. Despite these advantages, less than half of the top 20 utilities are currently applying analytics to energy consumption, but utilities executives across all regions believe that with the proper planning, organizations can achieve desired profitability goals in a relatively short amount of time.

“Smart meters and a diversity of transmission and distribution grid sensors are generating volumes of data, and this has the potential to have a profound effect on the business,” said Jill Feblowitz, practice director, IDC Energy Insights. “Surprisingly, utilities executives indicated that they are not yet at a point where they’re making full use of this data.”

The study also showed that utilities recognize that they must do more to adopt new meter-to-cash processes to drive the bottom line. New remote connect and disconnect services can send an automated notification to customers of possible shut off, which creates a more open lines of communication with the customer and enhances their service experience. The availability of new data through updated meter-to-cash systems tells providers more about customer credit history, payment history and consumption will support improved approaches to credit and collections.

“A critical component of successful planning is a comprehensive, long-term roadmap for the smart enterprise that takes into account changes in technology, business processes and customer interactions,” said Robert E. Welch, president, CSC’s Chemical, Energy and Natural Resources Group. “CSC is working with its clients to ensure they are prepared to implement smart technologies and keep their business moving forward.”

More key findings from the interviews conducted for the study include:
  • Smart grid investments are strong across all surveyed regions regardless of whether or not utilities have received stimulus funding
  • Utilities embracing a comprehensive network strategy will benefit from scalability capabilities as new application deployments increase
  • Short-term planning will result in overspending, thus a long-term vision of enterprise architecture that considers changes in business processes and customer interactions is essential
  • Smart grid security will be a major focus for utilities and this provides a huge opportunity for security services outsourcing
“The move to smart energy provides utilities with the opportunity to improve competitiveness, profitability and customer satisfaction. ROI can be realized more quickly than many utilities recognize. The average payback for investments in smart metering/Advanced Metering Infrastructure is just six years. The average ROI period for dynamic pricing is even faster, just three years,” added Welch.

For more information, visit visit www.csc.com/2010SmartStudy.

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