Exhibit to Agenda Item #1a

Transcription

1 Exhibit to Agenda Item #1a Board Strategic Development Committee and Special SMUD Board of Directors Meeting Tuesday, June 19, 2018, scheduled to begin at 5:30 p.m. Customer Service Center, Rubicon Room Powering forward. Together.

2 Sacramento Municipal Utilities District Internet of Things (IoT) Presentation June 19 th, 2018

3 Today s Agenda Internet of Things (IoT) Introduction and Overview Overview of IoT Industry IoT Market Landscape Overview Industry Adoption Review Utilities focus Internet of Things Strategic Framework Internet of Things Value Analysis Relevant IoT Utility Use Cases Smart Thermostats Smart Meters Electric Vehicle Charging Stations Smart Grids Edge Analytics IoT Implementation Considerations IoT Future Projections and Closing Remarks

4 Internet of Things (IoT) Introduction and Overview Definition: The interconnection of uniquely identifiable embedded computing devices within the existing Internet infrastructure Historical Background: 1990s: real-time implementations of RFID in logistics, warehouses, supply chain Smart Devices Some level of automation; programmable for specific use Configuration flexibility limited Consumer product examples: smart bulb, smart thermostat, smart security devices Level of Sophistication Connected Devices Remotely controlled and monitored (mobile appable ) Configuration flexibility limited Connectivity options: Bluetooth, LTE, Wi-Fi, wired IoT Devices Software defined productbase containing: product, application, analytics, internet/network Potentially more value than smart or connected devices: scalable, upgradable, automated and future-ready Context: Data amassed from these devices can be analyzed to optimize products, services, and operations Energy optimization: sensors deployed across the electricity grid can help utilities remotely monitor energy usage and adjust generation and distribution flows to account for peak times and downtimes

5 IoT Potential Internet of Things (IoT) Introduction and Overview IoT s Purpose is simple: extending connections between people and computers to include objects as well. But this simple concept has big consequences. 10,000,000,000,000,000,000,000 bytes of data over 18,200,000,000 connections. That is the current scope of the Internet of Things, as estimated by Cisco. Any given organization can have billions of ways to mix and match connections to gather and analyze data, many of which can have powerful benefits. Tapping into this unlimited potential requires investing time in exploring the IoT today. Time [The IoT] has the potential to grow global corporate profits by 21% in It s exponentially increasing. Wim Elfrink, EVP Industry Solutions, Cisco Source for quote and statistics: TechRepublic You are here. The Internet of Things has reached the knee of the curve, where it will suddenly advance so rapidly that potential uses are beyond the reach of speculation. Like all new technology, the IoT is advancing exponentially. Its advancement in the last few years is nothing compared to its potential in the next few years.

6 Measure Internet of Things (IoT) Overview of IoT Industry Protocols Sensors / Controllers Activity Domain Cellular Wi-Fi Light HVAC Magnet Home Vehicle NFC Seismic Bluetooth Imaging Thermal Office Z-Wave Acoustic Zigbee RFID TCP/IP Chemical Water Location Health Identity Control Utilities Manufacturing Industry Retail Finance Oil & Gas Healthcare Analytics

7 Internet of Things (IoT) Market Landscape Overview Wearables Industrial IoT Connected Home IoT Infrastructure and Sensors UAV / Drone Smart Utilities and Energy Connected Fleet Sources: CB Insights, Statistica

8 Industry Adoption Review Utilities focus Barriers to Adoption exist Barriers Aging US energy infrastructure Complexity of system-wide rollouts Confusion over available options Notes 70 percent of the power transformers in the country are more than 25 years old Single point of failure scenarios abound, impacting ability to record and transmit data effectively Slows decision making over investments; growing number of devices and network options available Although Opportunities Do Too Opportunities 2007 Energy Independence and Security Act New connectivity options Notes Install base of hundreds of millions of digital meters supported by remote reading capabilities, increasing efficiency and control costs for providers and education for end consumers NarrowBand-IoT (NB-IoT), combined with more secure platforms are opening the doors of innovation in enterprises

9 Internet of Things Strategic Framework Objective Create more billable events Application Introducing new consumer-oriented products such as electric vehicle charging stations Improve productivity of operations Introducing connected field worker solutions [such as wearables] to improve personnel security and task optimization The Internet of Things infographic The Connectivist based on Cisco data Maximize the utilization of capital assets improve yield of the distribution grid, power station, facilities

10 Internet of Things Value Analysis Value Analysis Legend: Significant Large Moderate Minimal None Corporate Value Levers Consumer Value Levers IoT Technologies Revenue Growth Operating Efficiency Asset Efficiency Functional Value Economic Value Observations Smart Thermostats Smart Meters Complimentary to connected/iot home 2007 Energy Independence Act prompting adoption EV Charging Stations Increasing EV adoption Smart Grids IoT helps maximize return of investment in infrastructure Edge Analytics Helps simplify field operations

11 Use Case #1: Smart Thermostats Definition: Devices that can be used with home automation and are responsible for controlling a home s heating and/or air conditioning. Context: Smart Thermostats perform the same functions as a Programmable thermostat as they allow the user to control the temperature of their home throughout the day using a schedule, such as setting a different temperature at night. Impact: Utilities can use information from smart meters to realize additional applications in this new business area, alone or with partners. Municipal, regional, and national governments are launching smart-city initiatives, aimed at promoting technical innovation and systematic applications of the Internet of Things in urban landscapes. Utilities are partnering with cities and builders to implement sensing technology and data analytics in self-learning buildings, as part of integrated municipal energy and environmental planning.

12 Use Case #2: Smart Meters Definition: Enable two-way communication between the meter and the central system. Such an advanced metering infrastructure (AMI) differs from automatic meter reading (AMR) in that it enables two-way communication between the meter and the supplier. Context: Since the inception of electricity deregulation and market-driven pricing throughout the world, utilities have been looking for a means to match consumption with generation. Smart meters provide a way of measuring site-specific information, allowing utility companies to charge different prices for consumption according to the time of day and the season. Impact: Data of a higher quality and with greater veracity. Tailored products can be developed, such as demand-response programs to customers allowing utilities to control their heating and cooling. Variation in maintenance contracts that provide distributed facilities with improved service based on data analysis. Long-term potential for utilities to own the distributed facilities and sell optimized hours to facility operators and other customers (customer proximity, technological competence, and digital capabilities as a competitive advantage). Connecting/disconnecting service and read meter consumption remotely are potential labor savings for utilities.

13 Use Case #3: Electric Vehicle (EV) Charging Stations Definition: Onsite infrastructure that supplies electric energy for the recharging of electric vehicles. Public charging stations are typically on-street facilities provided by electric utility companies or located at retail shopping centers and operated by private companies. Context: Global electric vehicles market is estimated to grow in volume at a CAGR of 28.3% from 2017 to 2026 EV owners prefer public charging stations connected to charging networks with a single monthly fee and the ability to recharge their vehicles at hundreds or thousands of charging stations. Charging stations provide opportunity for property owners to generate extra income and provide services to customers or employees. Charging stations also need to make intelligent use of the electrical power supply. Charging stations need to be aware of electric rates and have the ability to react. Impact: Impacts grid management. Increasing demand for EV stations will stimulate innovation of EV stations from connected devices to full-blown IoT-level sophistication.

14 Use Case #4: Smart Grids Definition: An electricity network that can intelligently integrate the actions of all users connected to it - generators, consumers to efficiently deliver sustainable, economic and secure electricity supplies. Context: Well-maintained assets are more cost effective. Using smart grids to monitor environmental factors makes economic sense Analytics can be used to discover problems and quickly identify probable causes by comparing data patterns. Impacts are assessed and steps taken to minimize downtime Sensor-enabled machines can detect when a part is approaching end-of-life and text for a replacement before it fails. Grids can display safety instructions whenever an employee approaches dangerous machinery, minimizing the risk of damage to equipment and its operator. Impact: Maintenance is also cheaper sending a drone or robot down to monitor or repair underground pipes, cables or wires. IoT can help optimize work processes. Cognitive computing allows operations teams to look at sensor data combined with field geolocation and weather data to optimize service routes.

15 Use Case #5: Edge Analytics Definition: An approach to data collection and analysis in which an automated analytical computation is performed on data at a sensor, network switch or other device instead of waiting for the data to be sent back to a centralized data store. Context: Advancements in embedded systems on a Chip (SoCs) now enable commercial devices powerful enough to run full-fledged operating systems and complex algorithms. Edge analytics (combined with cognitive computing), allows companies to analyze data wherever it resides in the network, and reduced the need for data storage. Computing approach not only simplifies field operations, but improves operations generally by optimizing performance of the grid and preventing equipment failures. Impact: Edge analytics are changing how utilities make decisions, including increasing the speed and accuracy - of decision making.

16 IoT Implementation Considerations Concerns: Managing Security and Privacy of IoT In a Tripwire survey of over 200 people, less than a third of security professionals said they were prepared to deal with IoT security risks. Managing a Growing List of IoT devices Internet of Things (IoT) sensors and devices are expected to exceed mobile phones as the largest category of connected devices in Manage the Data of IoT Less than one percent of the data generated by sensors currently used for decision making. Solutions: Adopting & Maintaining Voluntary Security Standards Absence of industry-wide IoT standards, with security, interoperability and cost considerations comprise > 50% of executive concerns on IoT Enable Better Decision Making Additional data provides capability of new data and potentially improved decision-making capability that benefits consumers Implement New External Functions New business functions and revenue opportunities are possible, allowing organizations to build customer intimacy

17 IoT Future Projections and Closing Remarks The Internet of Things is both evolutionary and disruptive. Additional developments such as blockchain / distributed ledger technology bring additional value to the IoT ecosystem Digitally-engaged customers are more engaged customers: Security and privacy remains an important concern The IoT remains essentially about connecting material things to the Internet

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