In previous articles of 91¿ì»îÁÖ’s Energy 2020 blog series, we discussed the interplay of three major forces Ìý– maturing long-term energy trends, collapsing oil prices, and long-term ramifications of the COVID-19 pandemic – and how these events will push energy companies to adapt their business models driven by the evolution of a different energy consumer.Ìý

Energy 2020 will also drive companies to refashion their operating models for the future, the subject of this article.Ìý This will affect companies across the energy supply chain including T&D networks, retailers, energy solutions providers, renewables operators, and others.

Across the world, pandemic-forced lockdowns have forced energy and utility companies to respond rapidly to sustain their operations. Energy retailers that we spoke to have enabled thousands of frontline customer service agents to work from home. T&D utilities have ensured control center operations by sequestering control room staff, developing temporary accommodations, and enabling regional control centers to provide mutual fallback capabilities and readiness to take over control of larger service areas. These experiences are already shaping industry conversations around the potential for longer-term operational transformation.

What are the forces of change, and how will they affect the operating models of energy companies?

Energy 2020 will accentuate four transformational forces of change – Accelerated Digitalization, Intense Disruptors, Changing Customer, and Energy Transition – that present abundant opportunities to shape a future-ready operating model across your key value streams including assets, work, operations, front and back office, supply chain, health and safety, and risk and compliance.

Let’s define the four forces of change and examine a few examples of the opportunity themes emerging at their intersection with the value streams. Enterprise-specific opportunities that underpin future operating models can be mapped using 91¿ì»îÁÖ’s recommended framework, shown in the exhibit below, as a starting point.Ìý This framework, used alongside a service design-led methodology, will lead to a canvas of opportunities specific to your organizational context.

Accelerated Digitalization:Ìý Digital enablement of energy business processes is already underway, with greater investments in areas such as , analytics, and selective process automation and IoT. Companies are also making exploratory investments in emerging areas such as advanced AI, digital twins, mixed reality and blockchain.

The events of 2020 will permanently alter several work practices and operations at energy companies, including more remote working for front and back office teams, new health and safety protocols for field work, measures to de-risk supply chains, and more.Ìý Organizations will, therefore, need to reinvent key processes. Accelerated and broader digital enablement will be critical to achieving these new ways of working and sustaining long-term efficiencies.

In the work management domain, for instance, enabling teams to do more field-related work remotely, and making field work safer and more efficient are examples of key opportunity themes.Ìý Examples of specific opportunities here could include at-scale deployment of real-time machine vision and video analytics for asset and site inspections to reduce field visits, IoT to assure field worker health and safety, and advanced mobility and mixed reality-assisted field work.

Similarly, the maturity and versatility of IoT platforms, and the ability to quickly design and fabricate low-cost application-specific sensors, offer the opportunity to rapidly prototype and scale all manner of remote asset monitoring and operations.

In the front and back office domains, a significant shift towards working-from-home (WFH) will drive opportunities to reduce operating costs and promote employee welfare. This transformation will present opportunities to exploit a combination of process automation, AI and digital collaboration tools to achieve secure, productive and cost-efficient delivery of work.

Intense Disruptors:Ìý The wide-ranging disruptions to your energy business operations caused by the COVID-19 pandemic will already have helped you gain a deeper understanding of your operational strengths and deficiencies.Ìý Recent years have seen an increasing occurrence of high-impact events such as wildfires, severe storms, floods, and the more recent pandemic.Ìý These types of intense disruptors cause unprecedented large-scale damage and operational challenges within a short period of time and often with little notice. ÌýThese experiences emphasize the need for energy companies to invest in reinforcing their operational resilience and agility.

Opportunities to bolster organizational resilience will exist across your chain of operations. In the asset and operations domain, for example, an emerging theme is to build flexibility and agility for critical operations, such as asset and network control, to be more adaptive to severe disruptions. The decoupling of network control support functions, such as simulation and diagnostics, from core control room operations and allowing these to be delivered remotely will be a key enabler.Ìý New protocols will also need to be developed for co-located field crews with embedded safety practices such as social distancing and digitally-delivered work assignments.

Changing Customer:Ìý Sharp changes in customers’ lifestyle, work, financial, and social dimensions, driven by the events of 2020, will significantly influence their choices and behaviors.Ìý This, as we have discussed in an earlier post, will require energy companies to realign their business models.Ìý Additionally, these changes will also impact your operations and present unique opportunities to build operating models that are aligned to your future customer.

In the front and back office, for example, customer service operations that are digital-first and agent-light will rapidly become the norm.Ìý Other changes in customer mindsets – including a reinforced empathy for essential service providers such as utilities and a deepening do-it-yourself (DIY) mindset – will present opportunities to promote customer-assisted work such as low-risk visual inspections and imaging of faulty or damaged assets.

Energy Transition:Ìý The transition to renewable and low-carbon fuels, which has already achieved economic inflection points in several markets, will continue to accelerate.Ìý Energy storage, electric vehicles, peer-to-peer trading, embedded and rooftop renewable generation, and other trends will continue to grow quickly.Ìý This will influence the investments that energy networks, retailers and others in the value chain need to make in building operational flexibility and supply chain adaptation.

With an increasing number of customers participating in the transition, both as prosumers and participants in balancing markets, a more versatile distributed energy resources (DER) orchestration capability will be required for networks, system operators and aggregators.Ìý Enhanced operational technology (OT) complemented with application-specific IoT and AI solutions will play a key role.

Another emerging theme is the interplay of the energy transition and the circular economy movement in some markets such as Europe. ÌýThere is increasing interest on the part of both energy companies and their customers to participate in circular economy models.Ìý This opportunity theme will influence several operational aspects including the supply chain, front and back offices, and more.

Safety and security footprints will get wider

Updated safety and security capabilities will be key enablers underpinning the evolution of the future operating model across all the above-mentioned dimensions.Ìý The sudden advent of at-scale WFH arrangements will expand the definition of the workplace.Ìý Social distancing precautions will influence office and field work arrangements.Ìý These will require refreshed protocols and capabilities to assure worker health and workplace safety.Ìý

A key example of an opportunity theme in this context will be to scale up digitally-enabled training using collaboration tools, mixed reality, AI and digital twins to sustain competence development efforts while improving the training experience, and minimizing the need for physical co-location during training.

An adaptive cybersecurity posture that maintains the required protection levels of operations and assets while also allowing operational flexibility and agility will be crucial. This will be essential to enable, for example, permanent WFH arrangements for a wider scope of remotely delivered work and operational transformations such as enhanced DER orchestration.

An opportunity to lead the industry’s transition

Energy 2020 will amplify prevailing forces of change while introducing new ones, too.Ìý The events of the year have presented unprecedented operational challenges to energy companies.Ìý At the same time, they have also introduced unexpected trends and changes such as shifts in customer mindsets and the rapid adoption of digitally-consumed essential and lifestyle services during the lockdowns. These trends offer a strategic opportunity for companies to reinvent key aspects of their operating model on their way to building the energy enterprises of the future.

The key is to start now.Ìý

Are you ready to visualize a different future for your energy company and lead the change for your industry?

Please reach out to us at info.energy2020@wipro.com with your questions