Energy and water companies operate in a complex and demanding environment. Often existing within a strict regulatory regime, they must balance service provision with the need to maximise customer or development opportunities. They rely on IT and communications within the corporate environment, in the field, at their plants, and across their transmission or distribution networks. And these IT services are critical in their nature, both in terms of being a national asset and in ensuring that operations are safe and efficient.
Mason Advisory has an established track record of supporting both upstream and downstream energy and water businesses, including large-scale communications projects at Middle-Eastern oil plants, IT strategies for national utilities, and assurance projects for smart metering programmes. From our experience of delivering a range of projects in the sector, we have identified a number of common challenges.
Monitoring and control. Machine-to-machine communication sits at the heart of the design and procurement of secure, resilient systems, including data, telemetry (SCADA etc.), and voice networks. Often in hostile environments – such as oil and gas fields – safety-critical IT systems and applications have to be implemented to ensure natural resources are harnessed in a safe and environmentally friendly way.
Cybersecurity. Energy and water companies must protect their assets from the risk posed by cyber attacks led by hackers, criminals and terrorists. From exploration to delivery, the sector holds a wealth of valuable information in relation to critical infrastructure, the corporations themselves, and their customers.
Smart metering. This brings a whole host of technology challenges, from national networking to customer-focused applications. Smart metering implementations help customers to manage their energy and water usage in real time, while the deployment of smart grids helps to manage distribution – minimising outages while keeping costs as low as possible. And although in many places the national infrastructure will be implemented by government, utility companies will be affected from their billing systems through to the security of the information on the devices they put in people’s homes and businesses.
Sourcing and IT delivery. Utility companies have traditionally had large in-house IT operations, running some highly customised applications. Many companies have started moving towards outsourced solutions for their corporate systems, but there is still significant caution about off-the-shelf applications and cloud-based solutions. IT leadership teams need to develop sourcing strategies that can exploit the benefits of market developments without compromising delivery.
Meeting critical and corporate needs. Utility companies need to provide very high-availability operational communications and as well as highly efficient corporate IT. This is a balancing act that can lead to a complex delivery model, or over-specified IT services that meet the needs of the most critical parts of the business. Utility companies need to look at the best ways of setting up contracts, while still ensuring that service providers are meeting the extremely high demands of optel networks through effective service level agreements and good service management.
Business transformation. Energy and water companies continue to be heavily regulated, and in many countries they are still adapting to aftereffects of privatisation. Many are in the process of delivering change programmes, but the scale of the businesses involved means progress can be slow. Technology can support this transformation, but needs to be carefully planned and aligned to the overall vision of the business.