THE ELECTRICITY INDUSTRY
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1 CISB413 MALAYSIAN ELECTRICAL AND POWER LANDSCAPE Use of INFORMATION SYSTEMS in the POWER UTILITY Industry Prepared by Ammuthavali Ramasamy, 2013 THE ELECTRICITY INDUSTRY 1
2 Support Activities Function of the electricity industry Generic Electricity Industry Value Chain HUMAN RESOURCES PROCUREMENT FINANCE, LEGAL & OTHER SUPPORT SERVICES Profitability INFORMATION TECHNOLOGY GENERATION SYSTEM OPERATIONS TRANSMISSION DISTRIBUTION CUSTOMER SERVICE Profitability Primary Activities 2
3 Industry Trends The electricity sector is continually evolving to better serve its customers and employees. Over the next 10 to 20 years, experts predict significant changes in the following areas: Sources of supply Demand for power Generating green electricity Intelligent energy transmission Industry Trends Sources of supply Experts predict the use of solar, geothermal and tidal power, as well as of wind and other renewable sources of electricity, will increase dramatically over the next 10 years. 3
4 Industry Trends Demand for power Despite the many national media campaigns, tax incentives and other initiatives that promote energy conservation, load forecasters predict that demand for electricity will continue to increase in proportion to population and economy growth. Industry Trends Generating green electricity Energy providers to reduce the environmental impact of power generation through renewable energy sources, cogeneration, distributed generation and many small sources of energy, such as rooftop solar panels. 4
5 Industry Trends Intelligent energy transmission Automated transmission systems are minimizing the need for workers to diagnose and correct elementary problems in transmission and distribution operations. Regulatory and Business Trends Operation moving from vertically integrated monopolistic industries to competitive industries Technological changes have been an important driver to allow the implementation of competitive schemes in an industry that had been historically considered as a vertically integrated monopolistic industry Overall inefficiencies, relative prices of fuel and higher environmental restrictions. Electricity is considered as a commodity, meanwhile transmission and distribution remain as a regulated service. 5
6 Electric Power Business Structure The Changing Electric Power Business Structure 6
7 Business Trends Energy markets have developed worldwide across a wide variety of different local market conditions. The situation faced by utilities in Asia can be summarized as: Growing energy demand De-regulation process has started Growing confidence in the stability of political and economic frameworks Need for increased infrastructure investments These changes are transforming traditional government owned integrated utilities. The future utility industry is expected to be less integrated, more diversified and more competitive. Technology Trends Utilities leveraging on IT as a key driver to enhance operational efficiency as well as create competitive advantage. Globally utilities have recognized the importance of integrating its key IT systems. The de-regulation of the industry has led to increased competition Wide use of the Internet and mobile technologies 7
8 Technology Trends Globally utilities have recognized the importance of integrating its key IT systems. Integration of business and engineering systems enables top management with adequate operations related information to support strategic decision-making. Technology Trends The de-regulation of the industry has led to increased competition Utilities have focused their attention on customer acquisition, retention and satisfaction. Customer Relationship Management programs, which leverage extensively on IT. 8
9 Technology Trends Wide use of the Internet and mobile technologies Utilities leveraging on such technologies in areas such as work dispatch, maintenance scheduling, project management and customer services. The use of intranets has allowed more effective communication between internal personnel Use of extranets has enabled cost effective communication with external agencies such as suppliers, customers as well as investors. Utilities Large, Small, Public and Private Are Focusing On Operational Excellence How can we increase customer satisfaction and deal with ongoing capital constraints? Changing Business Conditions How can we increase enterprise-wide efficiency to face deregulation, ongoing M&A activity, and fluctuating commodity prices? Environmental Issues How can we analyze contributions of new products and services toward changing environmental goals? Rising Customer Demands How can my organization meet increasing customer expectations for product availability, information, and service quality? 9
10 Electric Utility Business Process A Snapshot of Electricity Utilities Services 10
11 11
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