The role of technology in the future of energy

Our latest Women in Energy forum explored how technology will help to shape the energy transition. 

Technology will undoubtedly play an instrumental role in the energy transition. An influx of innovative solutions will create new possibilities, helping the industry to unlock a clean and resilient energy system that’s fit for the future.

But at the same time, emerging technologies present some unique challenges.

This is what KPMG’s Women in Energy forum came together to discuss. Nina Arora, Director, Technology in M&A at KPMG, hosted a panel including:

• Yvonne Brzesowsky-Ruys, Global Industry Director, Energy and Resources, Microsoft
• Helen Dawson, Innovation and Digital Transformation Strategist
• Lara Beers, Global Director, Business Development, Kraken Technologies (part of Octopus Energy)
• Teodora Kaneva, Head of Smart Infrastructure and Systems, techUK

Together, these industry leaders explored the opportunities and issues associated with new technologies, the drivers to digital transformation and examined how to shift consumer engagement especially with the potential of artificial intelligence (AI). And they underlined the importance of women to the industry’s technological future. 

To kick off, the panel shared their views on the opportunities that new technologies are bringing about in the energy industry:

For Teodora Kaneva of techUK, Britain’s position as a world technology leader is a golden opportunity for the sector in this country.

As well as traditional digital technologies, the UK is highly competitive in the global markets for emerging capabilities like quantum edge computing and artificial intelligence. Quantum computing alone could lead to a host of fuel innovations. We’re also a leader in the semiconductor space.

She sounded a warning note, however. “Investment in technology infrastructure will be crucial. Without it, the UK won’t be able to stay competitive in these markets, or attract the all-important tech talent.”

Yvonne Brzesowsky-Ruys sees cloud technology driving energy companies’ ability to scale. Migrating to the cloud will force them to look at their processes and databases, and bring data sources together to inform scenario-planning.

Some key activities can be done easily at scale on the cloud, she pointed out – such as:

• predicting supply and demand patterns and plant maintenance requirements
• ensuring that green energy actually comes from renewable sources
• matching renewable energy hour by hour, based on real-time data from smart meters (known as ‘24/7 matching’) 

The conversation moved to the digital transformation journeys that firms across the energy sector are on. What’s driving them? What are the challenges along the way, and what will underpin success?

In Lara’s view, digital transformation will be necessary for two reasons: to maintain customer engagement, and respond to change in the industry.

“Utilities’ core business is no longer selling energy, it’s customer service,” she affirmed. “Trust is what makes people engage with a business, and so the customer experience has become a key source of competitive advantage.” 

A great customer experience demands compelling propositions – which is a real opportunity for utilities providers in the current market.

Indeed, the panel saw huge promise in consumers’ adoption of smart meters, solar panels and electric vehicles (EVs). “Utilities can make this easier with full-service offers. For an EV, for example, that might cover the vehicle lease, electricity tariff, and feeding charge back to the grid.”

Delivering this sort of interconnectedness will require integrated systems. But offering smart products will transform customers’ thinking, by enhancing their literacy when it comes to energy.

“It will change the game.” Lara enthused. “It will change people’s mindsets when using energy. We know that customers with smart products contact their utility provider two or three times more often than those without. They have far greater visibility of their energy use, and are more preoccupied with it.” 

Consumers care about “connecting things that matter, so as to actually make an impact on the planet”, Lara affirmed. They want to take positive and practical steps, like changing their car, using renewable electricity to heat and cool their homes, and installing smart thermostats.

“Consumers are making rational decisions,” said Helen. But prioritisation is proving tricky, as Lara pointed out: “People want to know: what should I do first when balancing the grid? Do I prioritise my car? Do I pull from my solar?”

Firms must invest in sophisticated customer platforms and systems to enable such offerings. In Teodora’s view, a single ecosystem that consolidates customer data will help them map their customer base – and importantly, identify their vulnerable customers. “Having the data to understand who they are, where they live, what they need and when, will be hugely beneficial.”

Real time data can also assist business premises with their energy efficiency via “scheduling, you can see how long people are typically in a building, and adapt to those patterns with things like smart lighting,” Yvonne explains. “In most cases, an EV will just stand there for around six hours, so you can balance the grid accordingly. All these adjustments have an impact.”

In this context, organisations must “be able to react to changing customer needs, so that they’re not outpaced by new market entrants,” Lara warned. In her view, some firms are preparing to ride this wave. They’re overhauling their technology infrastructure, by shifting their customer operations off-premise.

Helen Dawson added that embracing consumer trends and behaviour will depend on an invisible and highly efficient supply chain, “seamlessly distributing a mosaic of new energy sources”.

Agility will also be crucial, given the pace of change facing the sector. But instilling it won’t be possible without the latest technologies.

Lara gave the example of continuous integration and continuous deployment (CI/CD) technology, which replaces periodic system upgrades with constant updates. Kraken enables approximately 200 updates a day – these might previously have happened only twice a year.

“That sort of speed is what drives agility and innovation – which in turn enhances customer engagement, because it’s what consumers expect.”

Our panel highlighted a number of hurdles in the way of digital transformation.

Leadership shortcomings seemed to be at the top of their list. Lara and Yvonne both pointed to leaders not always having the courage to make the big decisions and take the necessary risks. This is causing what Helen called a “strategy gap”, and Yvonne described as “functional conservatism”.

For Teodora, regulation is inevitably throwing up barriers in what is, of course, a highly regulated industry. In particular, the rules on data-sharing between businesses are holding back progress in her view.

She also highlighted a lack of data-readiness among the UK’s energy distribution, transmission and utilities companies. “There’s no quantum-ready data in the UK at all, and the picture is similar for digital twinning.”

Lara underlined the difficulties involved in integrating systems, so as to connect assets to the customer proposition. “You may need to connect 20 different systems, all with different data formats, to make transformation possible,” she explained.

In Helen’s experience, two underlying elements define the energy sector’s most successful transformation programmes.

First, they start small. They don’t attempt to transform everything at once, but focus on a few priority areas, such as EVs or customer engagement. And they make sure these areas play to their strengths.

Second, they tackle their legacy IT systems head-on. Problems with these systems often stall organisations’ transformation efforts, leaving them to spend most of the budget “keeping the lights on” – and the rest just “sprinkling” applications onto their current systems.

“You can’t do digital on the side,” Helen said. That won’t unleash the benefits of next-generation technologies like digital twinning and predictive maintenance.”

As KPMG’s latest CEO Outlook survey discovered, AI – generative AI in particular – is business leaders’ number one investment priority right now.

So a discussion about the technological future of the industry wouldn’t be complete without examining the impact of AI. Especially given the opportunities and challenges it presents for the energy transition.

“AI will become business as usual very quickly.” Teodora declared. “It has so many potential applications.”

Lara pointed out that it’s already business as usual at Kraken: “It’s essentially part of the platform,” she said.

It’s being used to automate time-consuming tasks like call summaries and customer communications, which bots can do faster and more accurately than human beings. “Around 45% of our digital communication is now being written by AI – without replacing jobs,” Lara explained.

“So instead, our staff can focus on more complex jobs, like serving vulnerable customers, which humans are better at.”

For Yvonne, one of AI’s most important uses in the energy sector will be improving safety in the field. It will allow engineers to access manuals, technical information and advice onsite, quickly and easily. “That will not only make them more productive – it will keep them safe, which is vital in our industry.”

AI will also help to scale renewables, she underlined, which will be critical to the green transition. With industrial metaverse technology, for example, you can simulate a wind farm before development – modelling different wind speeds, market pricing, and more. “You can envisage the optimal wind farm before building anything,” said Yvonne.

At the same time, AI can unleash the power of the multigenerational workforce – particularly for grid companies. It can remove mundane tasks, and offer the slick tools and processes younger employees expect.

The conversation turned to the role women will play in the industry’s technological future.

Several panellists expressed concern about the glass ceiling women face in the sector. Lara pointed out that there are 76 fewer women than men working in energy. Helen highlighted that for every 100 men receiving promotions in UK firms, only 87 women do. And Teodora lamented the fact that around 40% of women don’t return to the energy industry after maternity leave.

These barriers affect women throughout their time in the workplace: women tend to be held back from early on in their careers.

Helen also underlined the widespread pay inequality in this space: 92% of energy companies, and 91% of technology companies, pay their men more than their women. “The gender pay gap is real,” Helen affirmed, “As we progress in our careers, we owe it to ourselves to help the women working for us through the system. Because the system isn’t equal.”

Lara agreed, “We must bring it out of the shadows. I encourage our female leaders to ask for a raise as soon as they can justify it – not to wait on a timetable that's being pushed down from above.”

“The opportunity to see and learn from women in positions of power and influence is inspiring.”

The issues facing women in energy raised by the panel underline the need for a diverse workforce in the sector – and especially in technology roles.

It’s something the panel were keen to draw attention to. “Anything women can do to improve their digital skills will help them get involved in the most exciting projects,” Helen advised.

Teodora echoed this sentiment: “My advice to women today, especially if they want to work in energy, is to gather technical knowledge.”

“Women in technology roles will be critical to the future of the energy sector,” Yvonne predicted. Lara agreed: “We have a huge impact: we get stuff done. We deserve a seat at the table.”

This is why KPMG established the Women in Energy Forum: to bring diverse perspectives to the challenges facing the industry. Our vision is to build a network of women across the sector, to discuss the pressing issues and support women in driving the energy transition.

To find out more, and to watch the full conversation on-demand, please visit our Women in Energy hub.