IS Departments Feel the Wrath of Deregulation Activities

Transmission & Distribution World June 1998

By Chuck Newton, Automation Editor

Just as T&D professionals are learning that deregulation is having lasting effects on T&D investment and technology issues, so too are the IS departments of the world's electric utilities. More than 40% of the 70 IS managers recently surveyed said that deregulation would mean a "major overhaul" of information technology (IT) systems and services. Just about the same percentage indicated the very real possibility that the IS organization may become a separate business. Twenty percent said that deregulation concerns were causing serious delays in IT planning and implementation. A review of three subject areas reveals some interesting observations about the future direction of IT systems and services at utilities.

Internet Activities
As I noted in my June 1997 column, the Internet continues to grow in relevance and importance to utilities. Ironically, fewer than one-in-six utility IS executives indicated any use of the Internet for serving as a front-end to any production utility information systems. On the other hand, nearly one third indicated that such applications would be coming on line in the future. In fact, extensive planning is already under way for the Internet to play a key role in customer communications—with about one third of the respondents indicating that their utility was already doing this. A possible future role in providing Internet-based customer account information and bill paying mechanisms was also noted by several IS managers.

Integration and Communication Issues
Few utilities currently have any significant integration of enterprise (business) applications with operational applications; however, 30% plan to have strong links in the future. Meanwhile, 70% of the electric utility officials said that advanced customer communications capabilities were being developed. Respondents supplied a variety of reasons for this development. Among these, "Internet access" had the most mentions (54%). Automatic meter reading was next (44%). Seventeen percent of the IS managers indicated that customer premises security monitoring services would be offered, and 10% said that the communications capabilities were being extended to provide "smart house" services.

One of the most frequently discussed possibilities for non-energy related offerings, the launching of a telecommunications services business, was discussed in this survey. Somewhat surprisingly, 72% have no plans to launch such a service, at least in the near term.

Operational Systems
In another surprising finding was that only 40% of the electric utility IS executives thought that access to real-time operational data was "critical" for decision makers. Most of the rest indicated that such access was "somewhat important" to business managers.

IS officials pointed to outage management and trouble call systems as the most important operational system for marketing access. Revenue metering was not far behind in importance. More than 40% felt that service dispatch was vital and about one third thought that access to some EMS data was pivotal.

For business planning officials at these utilities, IS reported substantial interest in access to distribution management systems/applications. Finally, for the finance department, revenue metering data was termed especially important.

IS officials were more optimistic than their T&D operations and engineering counterparts about the outlook for full or service area wide deployment of pilot systems. Fifty-two percent of the officials indicated that they expected to see an increase in full deployment rates for currently piloted systems.

Year 2000 Compliance
The Year 2000 compliance issue is finally catching up with utilities as well. Even now, only about half of responding officials indicated that the issue was "critical to their utilities' computing and operating infrastructure. Meanwhile, 8% claimed "resolution" of this issue. Budgets for resolving the problem ranged from a few thousand dollars to several millions of dollars. About 25% of these significant allocations are being used to fix problems with "imbedded" systems, such as remote terminal units, programmable controllers, and other "smart" field instruments and intelligent electronic devices. Some IS executives were so bold as to indicate that compliance issues for these imbedded assets were "not their concern."