The 10 changes utilities will face in 2014



Quick Take:  IDC Energy Insights has come out with its annual forecasts for utilities. Some of them are so obvious and general as to be useless (CIOs will evolve). And some of them are cloaked in a thick layer of analyst-speak (adaptive utilities will embrace dynamic resiliency). But scattered amongst the silly stuff are several predictions that -- although they won't surprise you -- will provide a good reminder of the challenging times ahead. - By Jesse Berst


"Despite regional nuances, the globally utilities industry is in the midst of a major paradigm shift," said Roberta Bigliani, associate vice president of IDC Energy Insights. "Flexibility and innovation are the 'new normal' and digital technologies and distributed generation are the cornerstone of the transformation across the entire value chain,” Her firm made these 10 predictions:

1.     Utilities will hunt for flexibility and innovation in their operations and business models

2.     Microgrids will force business model change. At minimum, service opportunities will require it and distribution adaptation.

3.     CIOs will devote more time and attention to... cybersecurity, enlarging their scope of action.

4.     CIOs' role will evolve, driven by IT and operational technologies convergence.

5.     Eroding utility revenues and the increase of capital and operating costs will force utilities to develop analytics strategies.

6.     Adaptive utilities will embrace dynamic resiliency to survive the ecosystem changes.

7.     Utilities will need to seek new paths for data management to propel smart grid innovation.

8.     Utilities multi-channel customer management will call for platform and architecture investments.

9.     Gamification will gain traction in utilities to create consumer engagement, loyalty and trust.

10.  Global utilities IT spending will surpass $59.3 billion in 2014.


"In 2014, utilities will invest in analytics, mobility, cloud, social media, and cybersecurity," Bigliani concluded, "while CIOs will adopt alternative sourcing models to enable business agility and reduce IT investments."


Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.