Are you ready for challenges and opportunities for the energy sector?*

By: Carol Johnston, VP, Energy, Utilities & Resources, IFS

Today’s energy sector is complex, diverse, and facing unprecedented pressure and change. The drive to reach net zero requires sustained-year-on-year investment in renewable infrastructure to realize majority generation from solar, wind, hydrogen, and hydro is continuing into 2024 and beyond.

In an asset-intensive industry, managing, maintaining, and upgrading/renewing a distributed portfolio of linear, vertical, and portable assets poses several strategic and practical dilemmas. But technology has a key role in enabling an effective asset management strategy and creating opportunities for business transformation with data insights and optimized asset operations, maintenance, and performance efficiencies.

Replace, repair, or build back better?

Energy companies are faced with designing and creating a sustainable grid that is fit for today yet offers the capacity and resilience to meet demand tomorrow. Given limited resources, including a diminishing skilled workforce and finite capital, organizations are increasingly looking to predictive asset maintenance to extend asset lifetimes.

Research suggests most assets now in the field are operating beyond their original intended lifetime. In the US, over 70% of energy assets are over 25 years old1. Any forward-looking asset management, maintenance and investment strategy must be able to recognize where it makes sense to extend existing asset lifetimes, or where replacement or redesign is the most viable route.

By using data from sensors, scanners, and customer demand reports, asset performance monitoring, coupled with AI-based predictive analytics, allows informed, data-driven investment planning.

Capture now, benefit tomorrow

Capturing current performance and condition data of assets can provide valuable indicators to inform future investment. Today’s data, when correctly filtered and interpreted, can expose trends such as performance degradation, highlighting the viability (or otherwise) of future asset management and maintenance options.

Climate change and aging assets: the perfect storm

Capturing current performance and condition data of assets. Global warming is resulting in extreme climatic changes and events.

Unlikely weather-driven failures are happening far more frequently. Heatwaves are causing sweeping wildfires, destroying infrastructure. Exceptional sub-zero temperatures accompanied by heavy snowfall and ice are causing failures and outages. Unseasonably heavy rainfall, high winds and storms are creating flooding. Ignorance is not a solution for inadequate network resilience.

Up to 70% of the network may be operating beyond its intended lifespan, with failure rates and maintenance costs rising accordingly. Assets are also struggling to deal with ever-rising consumer demand, operating under extreme load.

Faced with this landscape, a predictive asset management program is essential; scheduled maintenance is simply no longer viable or affordable.

Big data, little insight

While energy organizations potentially have vast data volumes available, most have no automated filtering to extract meaningful insights. Data collection from smart meters and IoT offers a wealth of business intelligence, yet currently most ambitions don’t extend beyond billing. Using data effectively underpins strategic asset investment and a predictive maintenance program.

For example, major network outages are rare in most regions, but very visible, damaging in terms of both consumer confidence and brand reputation. Yet without automated monitoring and reporting, smaller frequent micro-events, which could be early warning signals, are often hidden and ignored – despite the fact that they may cumulatively erode margins more – perhaps even by up to 10%. Data visibility and insights highlight trends. They support informed decision making to reduce spend and increase network reliability and safety.

*The article above is extracted from the eBook, “Optimizing asset investment in the energy sector – Challenges and opportunities for a new era”, published by IFS. This eBook details how enterprises may find the right asset management strategy for them to optimise business success opportunities, with the following highlights:

• Opportunities for business success with the right asset management strategy
• The role of data insights, digital twins, and predicting consumer demand
• How IFS Cloud automates the management of assets and projects in a single, seamless platform

The eBook may be downloaded here.