Industry Dynamics: 2010 Guide to Technology in the Utilities Industry

Date: May 1, 2010
Pages: 25
Price:
US$ 1,895.00
Publisher: Datamonitor
Report type: Brief Review
Delivery: E-mail Delivery (PDF)
ID: I613691D367EN
Leaflet:

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Industry Dynamics: 2010 Guide to Technology in the Utilities Industry
Introduction

This brief provides an overview of the opportunities and challenges that vendors are likely to encounter in the utilities industry, outlining the key structures and developments, and the effect they have on decision makers and end-users.

Scope

- Provides an overview of how utilities have implemented technology to mange unprecedented pressures in the industry.

- Ovum's take on the technology priorities of utilities

- Provides recommendations to vendors navigating the IT market in utilities

Highlights

The technologies that underpin utilities' business processes are typically kept separate from each other, are often based around proprietary standards, and have low interoperability with other systems in other parts of the business

The pace of change in the utilities industry is increasing rapidly, driven by environmental concerns, aging and inadequate delivery networks, market liberalization, scarcity of resources, increasing fuel costs, a rapidly aging workforce, and increasing payment defaults

As these business processes change, so does the technology that supports them. The traditional model of siloed technologies will slowly give way to more interoperable systems, providing an enterprise-wide view of a utility's business

Reasons to Purchase

- Learn about the priorities facing utilities

- Understand the drivers and inhibitors behind the adoption of technology in utilities

- Identify strategies which vendors should adopt for future success in winning utility business
SUMMARY

Catalyst
Ovum View
Key Messages

FAR FROM HOMOGENEOUS, THE UTILITIES INDUSTRY IS SURPRISINGLY DIVERSE

The utilities industry principally provides electricity, gas and water
There are numerous divisions within a utility business
The upstream division of a utility business is centered around 'Plan, Build, Operate and Maintain'
T&D is again focused principally on asset strategy
Downstream is concerned with recovering payment from consumers
Commodity trading and risk management
The structure and size of individual utilities is diverse and varies by geography
Europe is characterized by large investor-owned utilities, and markets that are heading toward liberalization at varying speeds
The US market is fragmented with varying degrees of liberalization
Utilities serve both mass residential and commercial & industrial customers
utilities' business requirements HAVE Historically BEEN SUPPORTED by siloed technology
Operation technology (generation and T&D)
Meter-to-cash technology
CTRM technology

EXTRANEOUS PRESSURES ARE FORCING UTILITIES TO CHANGE DECADES-OLD BUSINESS PROCESSES

Environmental concerns have led governments and regulators to reduce carbon emissions
Future capital expenditure in infrastructure is vast
Market liberalization is coming, albeit slowly
Utilities are facing an unprecedented demand on resources, particularly in electricity and water
The high cost of fuel has put pressure on utility retail prices and has forced cuts in operating costs
An aging workforce will see a large proportion of utility staff retire over the next 10 years
The economic downturn has led to an increase in payment defaults

RECOMMENDATIONS FOR VENDORS

An endless pot of cash does not exist, therefore, utilities will be discerning about their investments
Conservatism is still a barrier to technology investment and outsourcing

APPENDIX

Ask the analyst
Definitions
Further reading
Disclaimer

LIST OF FIGURES

Figure 1: The utility business value chain
Figure 2: The business processes of upstream utilities are dominated by asset management
Figure 3: While still asset-focused, there is a greater emphasis on regulatory reporting in the midstream
Figure 4: Downstream business processes are essentially meter-to-cash
Figure 5: The responsibilities of the CTRM function
Figure 6: The restructuring of the US market has largely stalled
Figure 7: Major applications supporting upstream and midstream
Figure 8: Major applications supporting the retail business
Figure 9: Major applications supporting CTRM
Figure 10: Breakdown of predicted investments in UK electricity infrastructure
Figure 11: Price regulation in the EU, 2010
Figure 12: US utilities have a far older workforce than other industries

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Industry Dynamics: 2010 Guide to Technology in the Utilities Industry
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