Sep 07, 2017
Digitalisation is enabling power generators to turn industry challenges and complexity into opportunities
When the Digital Lead of ABB’s power generation and water business, Susan Peterson-Sturm, met with power generators and original equipment manufacturers (OEM) during the technology firm’s global customer event in China last June, the conversations made her smile: Everyone wanted to inject digital fuel into their growth tanks. “These customers are keen to look at digital solutions as a means by which to scale their businesses,” she says. “Power generators want to better understand how to improve the flexibility and thermal efficiency of their plants to be more competitive, given current low power prices in China. OEMs participating in One Road, One Belt opportunities outside of China want to look at remote collaboration and virtual power plants to efficiently scale their businesses for global markets.”
Digital is the solution
Peterson-Sturm is often asked how digital (or the Internet of Things, IoT) will transform the power industry. She says that “The power industry is undergoing tremendous transformation. Digital is a tool successful power companies will leverage to thrive in this complex market.”
She rattles off a few of the major changes her colleagues in the power industry have experienced over the past 20 years: power market deregulation, enforcement of more stringent environmental constraints, the creation of wholesale power markets and the addition of renewable generation resources. There is no shortage of challenges to solve. The result is a global power market in transformation, with traditional business value streams and asset utilization models being turned on their heads.
Peterson-Sturm says, “At ABB we’re privileged to have partnered with the world’s leading utilities to develop, test and operate digital solutions that have allowed generators to find new business models and thrive, despite market complexity.”
Problems ABB’s digital solutions solve
Knowledge and expertise retention: A key challenge for those operating in mature power markets in Asia is the retirement of experienced operations personnel, notably in Japan and Korea. For example, the ability to access both remote internal and external expertise is a huge enabler for these markets. ABB’s Collaborative Operations Centers provide infrastructure as a service, securely allowing experts outside the plant to monitor performance, support troubleshooting and maintenance, and help optimize plant operation. While Collaborative Operation Centers support improved health and safety of workers and reduce the number of technical experts required to operate and maintain plants, says Peterson-Sturm, Collaborative Operations Centers can also reduce operating costs.
Improving operational practices: Another challenge for those operating fleets of power plants is to ensure that best practices are applied and lessons learned are shared across plants. Leadership in many power companies want to enhance operational visibility of key performance indicators across their fleets. They want the ability to “double click” into individual plants or specific classes of equipment across their fleets. How can the best practices of the most efficient plant be implemented across the fleet, they ask? How can lessons learned from a recent forced outage be applied in operational and maintenance practices.
Managing complexity: The third example Peterson-Sturm provides relates to enabling power companies in highly complex markets to adapt to new opportunities and business models, beyond traditional operation. “For example, distributed energy resources, like rooftop solar or even demand-side management have made it hard for traditional unit commitment or dispatching functions to respond to fluctuating load requirements quickly and profitably,” she says. “Power companies can use digital solutions to make more accurate forecasts with data from smart meters, create more profitable unit commitment and bidding decisions with neural network generation forecasting modules, and minimize labor and complexity by deploying advanced analytics that can aggregate forecasts from many small renewable resources into a larger virtual power plant’”
What are other keys to success?
It starts at the top. Utilities are undergoing a “cultural shift” towards an information-based digital economy - where primary processes are digitalized - and moving away from the traditional business model that requires heavy investment in physical assets. In the face of this change, chief executives feel there is a real danger of getting left behind if they fail to rally their organization to the new digital order. The drive from leadership is key to the implementation of successful digital projects. It is vital that there is a clear link between any digital project and a company’s strategic priorities.
Think big but start small. While it is vital to have a big-picture vision for digital, early adopters started with small projects and pilots that quickly delivered tangible results. “Results and success drive more action and greater cultural adoption of digital solutions on the plant floor.” With the organization on board, larger and more ambitious projects are easier to execute.
It’s all about people, process and technology. Peterson-Sturm says “If companies do not make the necessary changes to their business processes so that digital solutions can deliver results, they will be left with cool technology that never gets implemented”. We cannot afford to make our colleagues feel alienated or not part of the industry’s digital future. We need digital programs, projects and pilots to engage the right stakeholders, which extend beyond operations and often involve colleagues in information technology, compliance and finance. In other words, remember to bring the right team along on the digital journey.”
ABB (ABBN: SIX Swiss Ex) is a pioneering technology leader with a comprehensive offering for digital industries. With a history of innovation spanning more than 130 years, ABB is today a leader in digital industries with four customer-focused, globally leading businesses: Electrification, Industrial Automation, Motion, and Robotics & Discrete Automation, supported by its common ABB Ability™ digital platform. ABB’s market‑leading Power Grids business will be divested to Hitachi in 2020. ABB operates in more than 100 countries with about 147,000 employees.