How Utilities Can Leverage the Power of Digital to Stay Relevant

by sagacity

For a long time, digitalization has been at the heart of the transformation of major utility companies, significantly contributing to the reshaping and reinventing of their business processes and business models. This is also because there is a growing urgency to adapt to the new ‘climate’ ecosystem that is environmentally sustainable and economically efficient.

As more utility companies continue to face unique challenges, digital transformation initiatives are now a must, considering the demands of changing customer expectations and market needs.

Going by this  Accenture report, 59% of utility company executives say that the pace of digital transformation for their organization is accelerating. This is likely to further gain momentum as more utilities companies begin to adopt renewable sources of energy. The transition to “clean energy” requires a new type of utility infrastructure along with a new decentralized business model.

Which are the new trends that are likely to impact utility companies, and how do they leverage digital technologies to stay relevant? Let us discuss.


The focus on customer engagement

In 2021, millennials and Gen-Z account for a major percentage of the customer base for utility companies. Digital transformation offers a unique opportunity for energy companies to develop meaningful customer relationships through digital tools that add value to both customers and companies.

According to this PwC paper, utility companies need to have a clear strategy for developing new products and services along with a matching customer relationship mechanism. Thanks to changing customer behavior, utility companies will be faced with key questions including:

  • How to prepare for the connected mobile customer?
  • What should be the strategy for smart energy technologies?
  • What choices in energy supply, payment modes, and green solutions should be offered to customers?


Further, customer engagement can be enhanced through faster response times, omni-channel experiences, self-service using mobile and web devices, and AI-powered conversational bots and analytics. For instance, Bounce Energy created a consumer rewards program to actively engage with its customers on Facebook, Twitter, and other social media outlets.


Find new revenue streams in renewables and digital payments

Renewable energy accounts for over 20% of the generated electricity in the U.S. and Europe in 2021, which is expected to increase to 33% by 2025.

Today’s younger customers are climate-conscious and are increasingly interested in new energy choices (including renewable energies) that offer greater control, comfort, and sustainability.

By adopting a renewable-centric strategy, utility companies can not only improve their operational efficiency but also reduce their carbon footprint and introduce new revenue streams.

This report prepared for the American Water Works Association (AWWA) and the Association of Metropolitan Water Agencies (AMWA) estimates that drinking water utilities in the U.S. will lose $13.9 billion in revenue due to non-payment of bills during the 2020 pandemic. Adding to that, an ACI Speedpay Pulse study found that 57% of users at the end of 2019 prefer to pay their utility bills online, and directly from the suppliers’ website.

Around 90% of power utility companies are now accepting digital payments in the form of online payments and digital wallets. The availability of digital payment technologies is enabling utility companies to provide customer convenience as well the mode to recover their losses and generate new revenue streams.


Smarter IoT-driven utility operations

Call it the Internet-of-Things or the Internet-of-Energy, smart utilities are taking the IoT approach to connect more energy devices and integrate new digital technologies to streamline business operations.

Traditionally, the energy & utility sector has always lagged because of strict local and global regulations. Smart utilities are different. For instance, smart grid technology will extend the long-term usage and value of energy distribution and integrate more renewable energy sources, thus decreasing carbon emissions.

Device-independent IoT solutions such as smart metering will accelerate business payoffs by reducing the need for technical assistance and support. For example, smart metering is not prone to challenges in hand-held meter reading such as probe failures, keying errors, meter memory failures, and low reads because of wiring issues. With smart metering, utilities no longer need to estimate bills or offer bill adjustments due to meter reading errors. It comes as no surprise that 115 million smart meter deployments are expected in the U.S alone by the end of 2021 (up from 107 million in 2020)


 AI-driven data insights

Energy and utility companies continue to apply smart technology including sensors, cloud computing, wireless devices, and network communication. This has led to the generation of large data sets (and data volumes) collected over some time.

Typically, any utility company can collect around three petabytes of data every 15 minutes for a year for about one million households with the use of smart meters. This influx of high volumes of data, if rightly used, can prove useful to make high-quality and accurate business decisions.

The use of Artificial Intelligence (AI) technology opens a wide range of opportunities for utility companies in the following ways:

  • Forecasting real-time supply and demand of energy using Machine Learning (ML) algorithms.
  • Enhancing infrastructural support using unmanned drones, thus replacing intensive and risky manual inspections.
  • Reducing energy frauds and thefts and providing cybersecurity with smart security solutions.


Modernizing workplace and improving workforce management

Today, utility companies need to constantly improve their performance and maintain high uptime. Energy customers also demand shorter response times to power outages and network faults.

How do utilities meet these challenges? By using digital workforce management solutions. With digital technologies, field workers can now use apps on smartphones and tablets to access relevant cloud-stored data, in place of handheld devices or traditional software tools.

By optimizing their workforce management, utility companies can increase workers’ availability in the field by 50% and reduce the time needed to complete daily routine jobs by 25%.

For instance, utility provider, PG&E, set up Digital Catalyst, their digital center of excellence. The team created a mobile app to help field crew complete asset inspections more efficiently and safely.



The energy and utility sectors are undergoing a massive digital transformation in the post-COVID environment. How ready are energy companies in leveraging the power of digital transformation? This will play a crucial role in their future success.

In the coming years, the energy sector is expected to further decentralize and offer personalized solutions to its consumers. From developing next-gen apps to leveraging analytical capabilities, Sagacity is at the forefront of digital transformations. You can reach out to us for support in your digital transformation journey.


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