August 21, 2009
When it comes to a smarter grid, utilities have been learning that success is about more than just technology. It's about people -- people inside the utility and people outside.
That is, in order for a project to succeed, it is important to have all of the internal departments on the same page and working together. These include administration, operations, engineering, IT and customer service. Similarly, understanding and cooperation are vital with external entities, such as municipalities, legislatures, regulators and consumer groups.
It would be nice to wave a magic wand and create stakeholder harmony. If only it were that easy. It's not, but success is possible.
Internal cooperation
According to Matt Wakefield, a program manager with the Electric Power Research Institute, smart grid/intelligent utility projects tend to converge many technologies -- especially engineering and operational systems. "Historically, utility IT groups have tended to be independent and not very well leveraged," he pointed out. "With smart grid, though, utilities find that they need to rely more on IT."
Wakefield believes it is important for engineering, operations, customer service and IT to work closely together. This is especially true for security issues. "In some utilities, engineering is responsible for IT, but this can pose a problem, because they aren't the real experts, especially when it comes to IT security requirements," he said.
Robert Sarfi, Ph.D., a partner with Boreas Group LLC, noticed "that it is rare that I run across utilities where there are completely harmonious relationships among departments. Making this even more challenging have been the budget cuts that have occurred during the past couple of years as the economy has worsened."
External relationships
Reaching out to, and cooperating with, external groups can be just as challenging as doing so internally. Here, education is the key.
Some key relationships include legislators and regulators. "It is important to remember that, when working with legislatures -- and even with public utility commissions --electricity is only part of their job," noted Frank Hoss, principal, utility business and technology solutions, Capgemini. "As such, it is important to emphasize education when working with these groups."
While many utilities focus on interacting with legislatures and regulators, similar interactions with consumer groups and consumers are even more crucial.
Just how important are consumers to the process as a whole? According to Niraj Bhargava, CEO of Energate, consumers may be the most important stakeholders. "It is important to engage consumers to support the kind of smart grid projects you want to do," he said.
"The one group that seems to have been left out, or at least the group that hasn't been receiving the right message, is the customer," suggested Capgemini's Hoss. According to Hoss, there are really two ways to build cooperation with consumers and consumer groups -- cost and the environment.
"The solution is to create more collaboration with community groups, municipalities and other external organizations," suggested Sarfi. Once this begins, then it is possible for the utility to create goals that are in alignment with consumer groups and other external stakeholders, and vice versa. In so doing, though, utilities have to be very careful to thoroughly inform people of the consequences of what they say they want. "For example, people may all say that they want a smart grid, but they may not want to pay as much for it as would be necessary," he noted.
It won't happen overnight. In fact, it's a little like watching sausage being made. But the one critical component that is often overlooked by those who want to see the smart grid come to light is people. And it will take all of them working together if that is to happen.
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William Atkinson
