Internet of Things in Utilities - Thematic Research
Imagine a world where an airplane can detect a fault in one of its engines in mid-flight and radio ahead to order spare parts without any pilot intervention. Or where your home thermostat automatically lowers the temperature when you leave the house and raises it the moment you return. The Internet of Things (IoT) refers to a world where various devices are connected to the internet with a view to automating more of our lives, saving energy, making industrial processes run more efficiently.
We are still early in this technology cycle. As yet there are no common standards, so it is difficult to predict any long-term winners and losers. However, executives need to understand the Internet of Things because it will soon morph into a mega theme. Inside, our analysis offers a framework in which to look at IoT, summarizes the important trends, and identifies the key players.
Utilities are facing significant challenges to their established business model, due to the increasing need to support distributed generation like wind and solar, storage, and electric vehicle charging, while keeping costs down. This is on top of the challenges of rising customer expectations, increasingly uncertain and complex regulation, and the need to replace assets that are reaching the end of their life.
One of the key ways that utilities are exploring in an effort to tackle these challenges is making their infrastructure more flexible and responsive and increasing the visibility they have into their assets. This approach means that utilities would ideally connect most sources of power, users of power, and the wires and transformers that move that power around and have data flows on all these assets. It also means that, to make the grid truly smart, utilities would also need these devices to be able to respond to central signals, and make decisions independently at the edge, in order to respond to system needs. Clearly, this is the very definition of IoT. Utilities have therefore been ahead of the curve in terms of adopting technologies like smart meters and smart grids, which are precursors to the wider adoption of holistic IoT solutions.
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