3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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ESILIENCE3Rs THAT MATTER in Utilities’ Transformation Journey

3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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Utilities across the world are radically transforming their businesses.

This is happening despite differing regulatory regimes and across the

diverse electricity, gas, water, and waste businesses. For instance,

technology is changing how energy is produced, transported,

consumed, and conserved. Technology is key to reducing the wastage

of water. Meanwhile, customers are not just increasing their experience

expectations — they are becoming prosumers with an active role in

energy markets. New business models are emerging, requiring utilities

to go beyond the traditional commodity business. Offering combined

distributed generation and energy storage at home is just one example of

how utilities are changing the way they accomplish their mission. Digital

disruptors are circumventing industry entry barriers, and utilities are being

reborn in 3D: decentralized, divergent, and digital.

While navigating along the journey, utilities have to maintain the right

balance between reinventing and growing their core and expanding into

new business models and revenue streams.

IntroductionIDC suggests that utilities should focus on three main elements: relevance, risk, and resilience.

3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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3 Are we relevant for customers?

3 For employees?

3 For best talent?

3 Are we securing a bright future to our companies?

3 Are we shaping the industry future?

3 Are we reducing complexity for our customers?

3 Are we de-risking innovation?

3 Are we managing risks?

3 Are we cyber-resilient?

3 Do we protect customer and employees’ data?

3 Are we embracing change?

3 Are we technically resilient?

3 Do we have a resilient business?

Source: IDC, 2019

RRR

3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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By 2022, 20% of

digitally determined utilities revenue

will come from new products and services.

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3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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Digitally determined utilities will be best-

positioned to evolve their businesses, adding

new business models and revenue streams,

as well as carving efficiencies out of their core

operations, with data as the pillar of innovation.

With the traditional commodity business

becoming progressively unsustainable, utilities

need to redefine their strategies to be relevant.

Find out more about IDC Energy Insights:

Worldwide Utilities Customer Experience

Strategies

7%

36%

16%20% 20%

ImpromptuDX

LOB DX Short-termDX

Integrated strategy

DX is the strategy

59% The Digitally Distraught

41% The Digitally Determined

The Digitally Determined Utilities

3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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By 2023, utilities will have

digitally connected “ “75% of their critical assets

to predict and prevent equipment failure and prescribe best maintenance

options to optimize and extend asset life cycles.

3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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Utilities around the world continue to embark on

IoT projects for myriad use cases. Nonetheless,

a staggering 23.3% indicated that their IoT

deployments to date were unsuccessful.

Utilities need to rethink their approaches to

IoT, ensure they are launched company-wide,

and not pigeon-holed into single or multiple

departments. Also, utilities should tap into their

ecosystems of partners earlier on, and not wait

until after all the technology decisions have

already been made.

Find out more about IDC Energy Insights:

Worldwide Utilities Connected Asset Strategies

Connected Assets

Already using

Plan to adopt in the next 12 months

Remote meter management

Remote asset monitoring

Sensor -based asset diagnostics and maintenance

Commercial and industrial building energy management

Sensor-based quality control

32%

31%

30%

29%

28%

Areas where utilities use or plan

to use the Internet of Things (IoT)

3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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By 2023, 65% of electricity companies will have invested in

digital technologies and platforms to support

flexibility services, thereby

activating a load potential of up to

35% of installed capacity.

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3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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IDC Energy Insights research finds that 80% of utilities

have either launched or are planning to establish a

flexibility services business within two years, and that

over a third believe flexibility will be a critical value

contributor to their retail operations by 2025.

Find out more about IDC Energy Insights: European

Utility IT and Operational Technologies Strategies

Flexibility Will be a Critical Value Contributor

Peer-to-peer wholesale energy trading

Peer-to-peer retail energy trading/microgrids

Market data registry/exchange

16%

16%

16%

14%

Why are utilities piloting or planning to use

blockchain? (% of European electric utilities only)

Meter-to-cash automation

Grid balancing, flexibility, ancillary services

eMobility services

13%

12%

3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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Make Meaning

and Be DivergentHelp Utilities be Relevant, Embrace Risk, and become Resilient

Scale up Insights to

Manage 360° Risk

Build Your Intelligent

Core Edge is key

Continue to be Customer

Obsessed but Focus on

Your Employee

Adopt Cloud to Reduce

Risks and Enable Agility

Enable an Agile

Organization

Do Not Forget Personal

Resilience

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3Rs that Matter in Utilities’ Transformation Journey ELEVANCE

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Related Research

3 What the Future Holds for Utilities: IDC Energy Insights’ 2019 View 

(IDC #EMEA44908219, March 2019)

3 Relevance, Risk, and Resilience: Peeking into Utilities’ Future 

(IDC #EMEA44852319, February 2019)

3 Utilities’ Digital Determination: Strategies, Road Maps, and KPIs 

(IDC #EMEA44389118, October 2018)

3 IDC FutureScape: Worldwide Utilities 2019 Predictions 

(IDC #EMEA43108918, October 2018)

3 The Digitally Determined Utility 

(IDC #US44330118, October 2018)

3Rs that Matter in Utilities’ Transformation JourneyELEVANCE

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For more information

www.idc-ei.com

insighteurope@idc.com

#IDCUtilities

IDC EMEA