Innovation emerged as a key strand, running through most headline topics at Utility Week Live. Whether sessions focused on future strategy, trust, or the resilience of infrastructure and assets, conversation gravitated toward a recognised need for innovation – and often disruptive innovation at that.
But despite this recognition, there was an overwhelming sense the change-hungry individuals within traditional utilities are finding their ambitions frustrated by the conservatism of their organisations which, it was observed by several show delegates, have little interest in seeing an overhaul of the establishment.
This is not to say that incumbent leadership actively avoids or squashes radical change. Rather, that leaders find their attention channelled ruthlessly on meeting the expectations of shareholders and regulators – leading to risk aversion as the norm and a dulled ability to think creatively about their relationship with big picture shifts in technology or society.
Crucially however, without active promotion of innovative thinking and behaviours at the top of our utilities, there is also limited trickle-down sustenance with which to build strong cultures for innovation . This was recognised as a major limitation in a round table discussion sponsored by technology giant HP and participants looked enviously to fast-paced companies in other sectors where innovative thinking was valued, supported and implemented within business as usual – not as a hived-off function.
Of course the ability of utilities to learn from sectors like manufacturing and digital technology is limited by the heavy hand of regulation. While schemes and funds, provided by regulators to stimulate innovation were recognised, the extent of their innovation was questioned.
Again at the Utility Week-HP round table debate on disruptive innovation, it was pointed out that innovation schemes originating from the regulators consistently ask companies to define expected outcomes in terms of benefits to the consumer before projects are given support.
Clearly this is a symptom of understandable focus on value for money. But it is fundamentally counterintuitive when seeking disruptive innovation, to attempt to define outcomes. HP’s Nick Wainwright also pointed out that it would be helpful to shift the terminology around innovation support from “funding” to “investment”.
Perhaps the overriding message on innovation across sessions at Utility Week Live was that business model innovation must be embraced alongside technology innovation.
Conversation and presentations proved that while the renewal of the UK’s aging utilities infrastructure with smarter, connected assets and customer touch points is a big challenge, it is a technical one which the engineering minds of sector experts are far more comfortable with than the struggle to reroute value streams, revenue flows and delivery models.
In a series of presentations focussed on the role of utilties in Future Cities, Paul Brodrick, head of connected communities at Siemens, revealed that its work with the Horizon 2020 funded Triangulum project in Manchester is set to move on from proving the technological scope for making the Oxford Road corridor and autonomous energy system, toward proving “how people will get paid” for supply and demand services in the new, dynamic energy environment.
An essential first step in understanding how lessons from projects like Triangulum can be absorbed on a larger scale was pinpointed by John Scott, director of Chiltern Power in a mind-bending panel debate exploring the changing paradigms of consumption.
Scott emphasized the essential requirement for a whole system administrator to be established as more connectivity, two ways flows and third party interventions attempt to plug into the energy system. Without such a “system architect” there is a very really danger of attempts at technological advance ending in consumer frustration, failures of service, and ultimately system collapse.