Plugged In

Plugged In is KPMG’s signature global publication for the power and utilities industry, and in this edition KPMG experts explore how technological advancements are shaping the sector around the world.

Many of the global challenges AI, automation and smart grids are being touted to play a pivotal role in addressing, also impact New Zealand. In fact many are amplified by our unique market challenges.

This report covers the latest global trends and advancements in AI, automation, and smart grids, exploring:

Real-world case studies of how these technologies are being used to help improve efficiency, reliability, and sustainability.
Leading insights on the challenges and opportunities facing the power and utilities industry.
Practical guidance on how you can implement these technologies in your own organisation.

Our local energy team have also considered some ‘Kiwi considerations’ - the unique challenges and opportunities that the energy sector in Aotearoa New Zealand faces in our transition to Net Zero.

Plugged In

Power and utilities magazine Third edition

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Plugged In Edition Three Exec Summary

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How AI and automation can improve efficiency and reliability

Discover how AI can be used to help optimise grid operations, predict and prevent outages, and improve customer service.
Learn how automation can help streamline processes, reduce costs, and improve safety.

How you can accelerate innovation responsibly

Kiwi considerations:

Technologies such as artificial intelligence could play a key role in the optimisation of the grid, load shifting, and the delivery of affordable, reliable, and sustainable energy can be achieved through the use of technologies such as artificial intelligence. The issue of load shifting in New Zealand has been in the spotlight lately, especially with recent reports of peak time shortfalls as the country experiences the first cold snaps of winter.

Increasing automation in New Zealand's energy system can reduce the need for manual intervention and help address workforce gaps, leading to lower operating costs and more affordable power.

KPMG Australia's research suggests that many utilities have a "hidden debt" of low productivity among their workforce, which technology can improve by transforming processes and service delivery models. This recognition is also starting to emerge in New Zealand, with utilities companies seeking to future-proof their operating models and reduce inefficiencies (as evidenced by Genesis's new operating model which may cut 200 jobs1).

Although AI will play a crucial role, the sector will also face the challenge of dealing with technology debt caused by legacy systems, and ensuring they can keep pace with the advancements in technologies.

1 https://www.genesisenergy.co.nz/about/news/genesis-meets-expectations-in-challenging-operating-environment

The role smart grids play in the transition to a low-carbon future

Explore how smart grids can integrate renewable energy sources, help improve grid resilience, and enable demand-side management.
Discover how smart grids can help utilities meet their decarbonisation goals.

How you can implement smart grids successfully

An interview with Ben Wilson, Chief Strategy and Regulation Officer at National Grid Group plc

Kiwi considerations:

Smart grids will play a crucial role in New Zealand's efforts to tackle the challenges posed by peak energy demand, which are expected to intensify with the increasing adoption of electric vehicles and electrification in general. It is recognised that addressing these challenges cannot solely rely on the supply side, and the ability to shift demand will be essential.

While major electricity consumers like the Tiwai aluminium smelter and NZ Steel already engage in demand side shifting, the implementation of smart grids will enable retail consumers to actively participate in the energy ecosystem as well.

The Energy Efficiency & Conservation Authority (EECA)’s recent Electrifying Aotearoa report2 found that nearly 8 in 10 people on off-peak energy plans change their power use to reap the benefit of lower costs, but only 30% of all participants were aware of off-peak plans and were enjoying the benefits of lower costs at different times of the day.

EECA’s research finds that awareness is high, but there are still barriers to wider adoption of smart grid technology. As appliances are replaced with smarter alternatives, regular consumers will have greater opportunities to shift electricity usage to periods when electricity is more readily available, cheaper, and environmentally sustainable.

2 https://www.eeca.govt.nz/assets/EECA-Resources/Research-papers-guides/Electrifying-Aotearoa-the-Consumer-Perspective-April-2024.pdf

How power and utilities companies can prepare for the future

Learn about the key trends and technologies that will help shape the industry in the years to come.
Get insights on how you can develop a future-proof strategy for your organisation.

How you can embed resilience across an organization

Kiwi considerations:

New Zealand’s distribution and transmission networks are signalling high investment needs to serve an increasingly renewable energy sector. Balancing the trilemma to a more sustainable system requires careful management of these costs against the challenges that intermittent renewable generation creates for energy security.

Bringing down investment costs will be key, and the Fast-Track Amendment Bill may help to cut consenting red tape. There are however many procedural considerations to define the eligible projects and ensure selected projects are not subject to the risk of judicial review. Through the submissions process, industry has called for greater clarity around whether reconsenting projects will be included and concerns around the ministerial decisions differing from the expert panel recommendation being open to appeal.

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Our country's isolation makes it necessary for us to find solutions on our own, as we cannot rely on other nations who have more options available to them. One such challenge is the lack of connectivity for importing electricity and transition fuels like gas. In fact, New Zealand, along with Iceland, is the only OECD country without a gas import or export connection. This lack of connectivity means we have a smaller safety net, which emphasises the importance of leading in the adoption of these technologies, we may not be able to afford to be a late adopter.

Get in touch

Our team welcomes the chance to talk to you about the insights raised in the PluggedIn report, how they relate to the Aotearoa New Zealand energy industry and how we can work together to meet your unique business needs.