Utilities Digital Services: Traversing Challenging Times with Technology Disruption

The utilities sector (electric, gas, and water), bolstered by legislative investments across the US and Europe, is poised to overhaul outdated systems and match other sectors in tech adoption. However, providing cost-effective energy/water and expedited customer services remains challenging. Despite these challenges in delivering affordable services quickly, utilities are diversifying energy sources and embracing digital upgrades for better efficiency. Investments in new tech aim to balance energy needs with climate realities. Moreover, sustainability is now critical, driven by regulations and expectations, with generative AI playing a key role in meeting compliance demands.

Both demand- and supply-side trends are covered in Avasant’s Utilities Digital Services 2024 Market Insights™ and Utilities Digital Services 2024 RadarView™, respectively. These reports present a comprehensive study of digital service providers in the utilities industry, including top trends, analysis, and recommendations. The reports also closely examine the leaders, innovators, disruptors, and challengers in this market.

Avasant evaluated 41 providers using three dimensions: practice maturity, investments and innovation, and partner ecosystem. Of the 41 providers, we recognized 19 that brought the most value to the market during the past 12 months.

The report recognizes service providers in four categories:

• • Leaders: Accenture, Capgemini, Cognizant, HCLTech, Infosys, and TCS
  • Innovators: Hitachi Digital Services, Kyndryl, Tech Mahindra, and Wipro
  • Disruptors: Atos, CGI, Genpact, IBM, and SAP
  • Challengers: Birlasoft, DXC, Fujitsu, and LTIMindtree

Figure 1 below from the full report illustrates these categories:

“The utility sector faces new challenges and opportunities, with increased investments and growing prosumers adding to grid complexity,” said Robert Joslin, Avasant partner. “Digital transformation, backed by federal funds, is key to modernizing the infrastructure and upskilling the workforce to prepare for the future.”

The full report provides a number of findings, including the following:

• • Across the world, electric, gas, and water utilities are leveraging federal investments to bolster grid security, increase reliability, optimize asset use, and promote eco-friendly practices.
  • With consumer demand for EVs and alternate energy devices soaring, utilities are standardizing renewable energy delivery with AI for grid balance. Quantum computing and digital twins are aiding in planning for renewables and grid capacity, ensuring effective integration of distributed energy resources.
  • Utilities are meeting customer demands for swift digital service with AI. AI chatbots offer 24/7 support for quick issue resolution, while generative AI enhances the experience with personalized communication.
  • Extreme climate events are causing fluctuations in energy costs and affecting utility services. To prevent outages, utilities employ specialized tools for energy management. They are also adopting resilient grid technologies to withstand disasters. AI-based predictive tools aid in ensuring a consistent energy supply throughout the year.
  • Facing a labor shortage, utilities are turning to digital solutions for efficiency and safety. Private 5G, AI scheduling, and AR/VR are streamlining operations, reducing manual work, enhancing safety, and fostering workforce upskilling.
  • Water utilities are adapting to new regulations and consumer demands for digital oversight and adopting platforms for online water quality monitoring and wastewater treatment. Additionally, digital twins and geographic information system technology ensure real-time water tracking, aligning with international usage and consumption standards.

“With advances in AI, rising consumer demands, and evolving regulations, the utilities sector faces new complexities,” said Praveen Kona, associate research director with Avasant. “Embracing generative AI can transform operations, streamline processes, enhance predictive maintenance, and drive innovation, positioning utilities as leaders in the digital age.”

The Utilities Digital Services 2024 RadarView™ also features detailed profiles of 19 service providers, along with their solutions, offerings, and experience in assisting utility companies in digital transformation.

This Research Byte is a brief overview of the Utilities Digital Services 2024 Market Insights™ and Utilities Digital Services 2024 RadarView™  (click for pricing).