Virtual power plants, Internet of Energy, and greater demand for renewables: the Australian utility industry is in the middle of major disruption, and is developing at a breakneck pace.
“We’re at a point where we’ve never had so much disruption in the industry,” says Leeanne Chau, head of strategy and data analytics at Ausgrid, a major electricity distribution company.
Chau spoke to GovInsider about the major sources of disruption, and how utility providers have been innovating to stay ahead of the game.
1. Technological transformation
Increased technological capability has created an “explosion of data” in the utilities industry, changing up the way utilities can respond to demand. “Moving to smart meters and so on means that we’ll have a huge, exponential increase in the amount of data,” says Chau. More data also creates more opportunities for innovation, creating a snowball effect of technological transformation.
One of Ausgrid’s newest innovations is its Virtual Power Plant, a system which feeds surplus electricity from residential solar battery systems back into the grid. Residents who have solar panels installed on their roofs can be paid for the electricity they provide. The additional power source helps reduce pressure on the grid at peak times. Utilising Internet of Things technology to link the batteries through the cloud, the decentralised network is dubbed the “Internet of Energy”.
So far, 233 customers have signed up in Sydney for the first trial. Ausgrid CEO Richard Gross said in a statement: “Solutions like a virtual power plant not only help customers, it helps the grid. If the trial is successful, it could provide a lower cost alternative to grid investment.”
More data insights have also led to a better customer relationship management platform. Ausgrid is no longer using snail mail to notify customers of planned power outages, and has now moved onto an app to communicate maintenance information to customers. “In the future, we’re going to be able to have the full history and knowledge of all the interactions that a customer has had with us,” Chau says.
2. More open markets
According to Chau, the opening of the utility market in Australia has been the single “biggest source of disruption” for Ausgrid, formerly a state-owned enterprise and monopoly utility provider in the state of New South Wales.
Increased competition has forced Ausgrid to become more efficient, more customer-oriented, and to keep innovating to retain its presence in the market. “Customers have more choice now than they’ve ever had before,” says Chau.
The increased consumer demand for renewables has created what’s known as the industry trilemma: how to balance sustainability, affordability and reliability of electricity services. Ausgrid hopes to take advantage of the technological innovations in the energy sector to better engage with consumer demands.
For example, Ausgrid is supporting customers who want to transition towards more sustainable energy sources. They are currently undertaking $4.2m project with the Australian Government Renewable Energy Agency in several Sydney suburbs to encourage residents to install solar panels and retrofit inefficient household light fixtures.
This trend towards the liberalisation of utilities is not limited to Australia, as markets overseas have begun to open, including in Singapore and USA.
3. Becoming more inclusive
As innovation is transforming the utilities industry, Chau hopes that the traditionally male-dominated industry can also transform itself to become more inclusive. “Ausgrid’s transformation strategy not only revolves around implementing new technologies, but also a cultural change as well,” she says.
Over the past few years, inclusiveness is becoming one of Ausgrid’s priorities – a stark change, according to Chau, where previously the lack of diversity was not recognised as a problem.
Chau herself is involved in student mentoring programs with local universities, and helps create support networks for young women entering the industry. “Showing up and demonstrating that there is a support network can help make our industry more attractive to different demographics,” Chau says. “Diversity in the sector leads to diversity of thought and diversity of ideas.”
The energy sector is more inclusive, more open and developing faster than ever before. “There’s never been a more exciting time to be in the utility industry,” says Chau.