The utility sector will require data-driven strategies to successfully navigate the energy transition and meet its net-zero emission goals. Fossil fuels like coal, oil and natural gas are the largest climate change contributors, responsible for over 75 percent of global greenhouse emissions. As a significant contributor to air pollution, the utility industry is under pressure from regulators, customers and corporate boards to do more in fighting climate change. It is positioned to lead the way by increasing the use of clean and renewable energy and encouraging customers to not only choose clean energy but also conserve overall energy use.

The energy transition is a global effort to increase more efficient use of energy by customers and decrease greenhouse gas emissions by shifting to cleaner energy sources (from fossil fuels) like wind, hydro, solar and battery storage. That said, the utility sector can only meet net-zero goals with data-driven technologies and buy-in from customers and corporate leadership.

This IDC blog examines four key areas in the utility value chain that will play a critical part in the energy transition and can help the utility sector meet net-zero emissions goals: Customer engagement, asset optimization and management, field services, and renewable and distributed energy resource management.

1. Customer Engagement

Customer engagement platforms and technologies will play a key role in helping utilities reach their net-zero goals. Customer data and analytics can provide utilities better insight into customer energy consumption patterns and preferences by allowing them to engage with environmentally conscious customers interested in green energy and demand side management and response programs. Leveraging Generative Artificial Intelligence (Gen AI) and Gen AI models, utilities can identify customers willing to help reduce emissions and energy use by participating in electric vehicle initiatives and distributed energy and energy efficiency programs, among others (see Figure 1).

Nearly 50 percent of global utilities are investing or plan to invest in Gen AI technology in the next 24 months (IDC's Europe, Energy Insights Survey 2023). Digital channels can drive customer engagement around these programs and raise awareness of their environmental benefits as part of the fight to address climate change and reduce energy demand and emissions.

Figure 1: Utilities' Planned Investments in Customer Programs for Energy Transition

2. Asset Optimization and Management

Pursuing a strategic data-driven approach to asset optimization and management will help utilities take a conditioned and proactive approach to asset management instead of following a reactive model such as a scheduled or time-based approach to maintaining assets. Leveraging models driven by AI and Machine Learning (ML) can allow utilities to get in front of asset failures before they occur, preventing asset downtime and increasing operational efficiencies. Additionally, market management systems driven by critical operational data, including historical data and forecasts on market fundamentals and asset performance, can assist utilities in how to best optimize their assets in the most effective and environmentally friendly manner possible (see Figure 2).

Note: Results from IDC client APM users

Figure 2: Strategic Asset Performance Management Impact in Utilities

Source: IDC, 2024

3. Field Services

Field services have been a growing investment area for the energy and utility sector to help decrease carbon emissions. Advanced field service management offerings can enable field technicians to utilize timely data and analytics related to critical assets and equipment. This data can arm field technicians with valuable knowledge and insight about equipment in inventory, previous maintenance procedures and recommendations on how to best restore assets and equipment. Leveraging digital tools that can access real-time data and remotely assist troubleshooting can result in faster restoration times, greater productivity from workers in the field and fewer unnecessary truck rolls, all of which can support efficient operations and contribute toward net-zero efforts.

4. Renewable and Distributed Energy Resource Management

Investment in renewable and distributed energy will require advanced technologies and data-driven approaches to manage the power grids of the future. Investments in advanced distribution management systems, along with distributed energy resource management systems, will enable utilities to effectively manage these resources and provide greater grid reliability and efficiency. A data-driven cloud-enabled platform approach to grid operations can integrate core systems and leverage data from systems such as asset management, advanced distribution management, field services and customer engagement applications to provide a unified and holistic approach to operations. Such an approach would include all utility operations stakeholders, ensuring a comprehensive strategy to optimize assets and encourage customer participation in running an efficient, reliable, affordable and clean energy system.

Breaking down silos of core systems, personnel and processes will also be needed to ensure success in meeting net-zero goals and creating sustainable operations to help utilities navigate the energy transition. IDC believes as the energy transition evolves and gains momentum, more utilities will turn to data-driven digital strategies to meet their net-zero emission goals.

Discover how ESG analytics can empower your utility organization to meet net-zero emission goals and drive sustainable success.

Note: This is a guest blog sponsored by WNS.