We’ve moved away from 'more data is better' to utilizing the data to transform the industry.
Denver, Colorado (PRWEB) October 15, 2014
Interview Part II on Big Data Analytics with Michael Schneider
We were fortunate to have the opportunity to sit down with the Vice President of Operations Support for SDG&E and SoCalGas Michael Schneider and discuss the current and future state of smart metering in the context of big data analytics. What follows is our edited interview that is part of our Thought Leadership Series across industries:
ClickFox: What is your perspective on the rapid adoption of smart metering in the U.S. and worldwide and what that means to utilities?
Schneider: As the industry has changed and technologies have evolved, the need for smart metering—-for integrating demand to supply at a micro level—-has become much more apparent. That is, consumers will have choices that they never had before. The smart meter is the gateway to providing integration on the grid and energy solutions overall. Really, it is a technology that is ripe for adoption and necessary in order to transform the industry in a positive way.
ClickFox: Do you see the United States as ahead of the curve in terms of smart meter technology adoption?
Schneider: Yes and no. We have opportunities to leapfrog in certain areas, but I wouldn’t put us ahead of the more progressive nations right now. The cost of energy has effectively pushed other markets to adopt faster cutting edge smart metering and time of use metering technologies. Until recently, we’ve had fairly economic energy costs in the U.S. Now we’re at a point in time where energy costs have increased to a level getting consumer attention, and there’s tremendous potential to leapfrog other countries. Smart metering is necessary to move us into the next generation of energy supply and demand.
ClickFox: How do you see smart meters helping companies better understand their customers?
Schneider: The key is gaining insight into very specific customer usage information and being able to use that data to provide solutions going forward. The fact is we are now able to measure and track consumption patterns, end use and consumer preferences at a much more granular level. We provide energy solutions based on this data, opening the door to many new opportunities. Just identifying the potential gaps in the way that customers use and value energy puts us at the forefront of offering the next generation solutions. Smart metering is an important part of this future.
ClickFox: We want our readers to better understand how smart metering might impact consumers in a positive way. What types of data might be collected in the home--and beyond what’s in the home--that could be useful to consumers?
Schneider: We want to help the consumer contextually understand the moment of truth. Oftentimes, consumers get a bill and if it’s within a reasonable range then they pay it, but they may have reservations. With smart metering data, we can provide a granular view of the household. We can show customers their distinct energy usage as compared to others; we’ll know if a house is insulated and whether additional insulation provides value to the customer. Moving forward, we are working on providing more options to customers based on data that we get from the advanced smart meter. This combined with billing and housing stock data gives consumers enough information to know if they’ve done everything that they can do to conserve energy. Of course, the danger here will be to avoid overwhelming consumers with too much information.
In the future, the customer will have a very different experience. For example, customers may be able to stipulate that they only want to pay a bill of “x” amount, and technology will take care of cycling appliances based upon a loading order, pricing order and alerts so that when customers are close to exceeding their usage limit, they will be alerted about how much energy they have left within the billing cycle. Customers get to decide what they want to do about that.
A word that I think plays well in this question/answer is transparency. In situations where customers don’t get to choose the provider (as in utilities), transparency is especially valuable. Smart meters give us and our customers a lot of transparency on usage and billing.
ClickFox: Analysts are predicting in three years that just under half of utilities’ smart metering solutions will be leveraging SaaS big data analytics for tracking and measuring because otherwise the demands of processing this data to obtain actionable information will overwhelm utilities. What are your thoughts on this prediction?
Schneider: Where the data is housed and access to the data are both open to debate, as are the solutions around it. Security and privacy issues also need to be thoroughly assessed. I had the responsibility of chief privacy officer in my past so these concerns are always in the back of my mind.
I would agree up to a point. All utilities aren’t equal. Of the 3000 or so US utilities, perhaps only 10-15% have the scale and the resources to leverage big data effectively in-house. I can easily see where small to mid-size utilities would be better served by software as a service providers. In our case, we’ll very likely use some of those providers as well as our own processing capabilities.
ClickFox: Do you think combining this information with other types of data would provide utilities with actionable insights into asset performance, consumption patterns and anomalies?
Schneider: Absolutely, the data will provide insights as we’ve discussed. Beyond the billing cycle, I am intrigued with the idea of moving beyond the utility industry to broader resource opportunities. To me the biggest opportunity in Southern California is using this technology in terms of water conservation, which is the Holy Grail of how this type of technology can be used to address resource scarcity. The most valuable aspects of leveraging smart metering data are that we can offer customers real understanding and control over their energy usage, their household preferences and appliances. We can also positively impact water usage management by applying the same awareness and conservation outcomes being realized with smart metering in the energy industry. There are many parallels between water and energy and how they are codependent with energy generation among the largest water user and water utilities a significant electricity user.
ClickFox: What advice would you give your peers on addressing their future analytical needs in smart metering and other areas?
Schneider: My advice is to focus on the value proposition as opposed to simply chasing vast amounts of data. We’ve moved away from “more data is better” to utilizing the data to transform the industry. We build our analytics engine with certain levels of flexibility. We’ve also learned that consumers don’t want to be overwhelmed with data any more than I want to be overwhelmed with data. We all want our time to be saved and the data to be provided in the context of actionable insights.
ClickFox: Where do you see utilities headed in the near- and long-term in terms of big data analytics?
Schneider: The industry is trying to understand in the near term what the greatest value proposition is for consumers. The business offerings will grow in that context. I see the same general model with telecommunications being applied to our industry. I think it gets back to determining a lot clearer way to manage energy costs and giving consumers choices. We’re already well into the smart meter integration, and we need to have time of use pricing, real price signals to the market, products integrated from a supply and demand perspective, as well as appliance integration. We also need to see the adoption and impact of wholesale electric vehicle and battery technology. In the next five to ten years, we’ll see a tremendous amount of change in the industry.
We’re already well into the smart meter integration, and we need to have time of use pricing, real price signals to the market, products integrated from a supply and demand perspective, as well as appliance integration. We also need to see the adoption and impact of wholesale electric vehicle and battery technology. In the next five to ten years, we’ll see a tremendous amount of change in the industry.
In terms of the smart grid, things like home generation with rooftop solar and electric vehicles must be considered in maintaining stability. Right now, we are planning for an instantaneous environment utilizing these technologies that help keep the grid in equilibrium with integrated resource planning.
For more insights on interesting topics, go to the ClickFox website.
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