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Energy, Utilities & MiningRoundtable discussion paper
Smart from the startManaging smart grid programmes
“You need buy-in and total commitment of yourwhole company before you startJim Meadows, Director, SmartMeter™ Field Deployment, Pacific Gas & Electric Company
because it will touch every aspect of theoperation of the utility.”
“It’s a once in a lifetime opportunity
Stephen Knight, Chair of UK Smart Metering Group, PwC
to engage with customers but there is a fine line between winning their faith or losing their faith.”
Smart from the start
1 Executive summary
2 The extent of change
Today’s global picture
Tomorrow’s potential
6 Getting it right
Managing project scale and breadth
Thinking about customers from the start
Working through the ‘whole organisation’ implications
14 Checklist
15 Contacts
Contents
“Smart grids are fundamentalto the changes thatneed to come – replacement of ageing infrastructure, clean energy, electric cars,securing supply and many more challenges. All thiswhile reducing the total cost. It seems impossiblebut this is where smart grids come in.” Jon Stromsather, senior smart grid manager, Enel
Executive summary 01
Smart grids are one of the biggest developments inthe power utilities industry worldwide in moderntimes. They offer the potential to significantly reducegrid inefficiency, enable more interactive demandmanagement, better integrate distributed powersources into the grid, change customer experienceand facilitate new uses for electric power.
However, the realisation of these benefits is not agiven. Like any major project, there are the challengesof delivering on time, on budget and operatingsuccessfully. But it is not just a matter of rising tothose challenges. Success also relies on a complexinterplay of technological, cross-sectoral, behaviouraland regulatory factors in addition to effective projectimplementation.
In Autumn 2010, we brought together around 40people in a roundtable of senior executivesfrom the US, Europe and the Middle East, as well asPwC smart grid experts, to gain first-hand insightinto the rollout of smart grids. Participants in theroundtable included major utility companies, networkoperators, suppliers, regulators and PwC specialistsworking on smart grid projects in different parts of theworld. The event benefited from the insight ofcompanies in a variety of markets and a variety ofdifferent rollout stages.
Key presenters of the roundtable included PacificGas & Electric Company (PG&E), one of the largestcombined natural gas and electric utilities in theUnited States, and ENEL, Italy's largest powercompany and Europe's second largest listed utilityby installed capacity. Both companies are at anadvanced stage in smart meter installation and smartgrid development.
This report draws on the experience of these andother companies at different stages of smart meterand smart grid implementation. The overridinglesson from the participants in our smart gridroundtable is ‘don’t underestimate the scale andreach of smart grid projects.’ They need to beplanned on the basis of a large capital project.
They also need have a very strong and robust focuson the concerns of customers and the wider publicright from the start and be accompanied by arealisation that the move to smart metering andsmart grids has implications for the wholeorganisation. Companies that view smart gridprojects in narrow technological terms are likely tofail to realise the benefits of smart grids at best andrun into major cost and reputation damage at worse.
02 The extent of change
By its nature the development of smartgrid infrastructure is evolutionary. Differentparts of the smart grid jigsaw, such assmart metering and high voltage directcurrent (HVDC) and energy storage, arebeing rolled out at different speeds. Therollout of the smart meter element ofsmart grids is furthest advanced in NorthAmerica and Europe.
Within North America, Pacific Gas & Electric Company(PG&E) in California has embarked on an ambitiousUS$2.2bn programme to install 10 million smart metersby 2012. It is firmly on track with over 6.2 million inplace by mid 2010. Elsewhere in the US, smart meterprogrammes are being rolled out in a number of otherstates, including Texas and Florida. In Canada, smartmeters are being rolled out to all small businesses andhouseholds in Ontario by 2010.
In Europe, Italy has the world’s largest smart meterdeployment. Enel became a global first mover byinstalling smart meters from 2001 onwards and nowhas 32 million in place. By 2011 all 36 millionelectricity customers in Italy are expected to becovered by smart metering. Spain and France will seethe next biggest smart meter deployment with Enel-owned Endesa, Iberdrola and EDF announcingprogrammes that will total 50 million meters.
With a smaller customer base, Sweden was the firstcountry to achieve 100% coverage. Elsewhere,European governments are adopting targets for smartmeter deployment with the UK, for example, aiming for100% coverage by 2020. Other parts of the world haveseen more limited deployments with testing and partialrollouts in countries such as Japan, Australia and NewZealand.
“Smart grids are a massive development for utilitiescompanies in all different parts of the globe, accountingfor a large slice of the already substantial capitalinvestment programmes planned by the industry,”observes Steve Randle, UK energy, utilities and miningconsulting leader with PwC.
The challenge goes well beyond the task of successfullyimplementing major smart grid programmes. Randlepoints out that smart grids herald a change or role andway of working for companies: “Utilities are also formingalliances and working closely with companies outside oftheir industry as part of the transformation of the powergrid. In doing so, they are sharing the growing financialand operational burdens as well as taking on addedresponsibility in a new, widened role of systemsintegrator.”
62% of utilities in a recent global surveycited smart grid initiatives as the reason forincreasing capital expenditure in 2010, and64% said the same for 2011.*
Today’s global picture
*The Newton-Evans Research Company, “Global CAPEX and O&M Expenditure Outlook for Electric Power T&D Investments: 2010-2011. Funding Outlook for Smart Grid Development”, Newton-Evans Research Company press release, February 25, 2010.
The extent of change 03
Zero penetration – no smart meter activity
Low penetration – minimal smart meter trials and/or limited rollout
Medium penetration – advanced trials and significant rollout
High penetration – completed or near completion of smart meter rollout
Europe
North America
Middle East
Asia
Australasia
Smart meter installations – planned and actual*
Smart meters – a global view
*500 million+ meters to be installed by 2025
Smart metering provides the bedrockfor many of the other elements of thesmart grid future.
Smart meter programmes form thebuilding blocks of a future where activeand interactive management of demandand load control is possible, new energysources can be fully and safely integratedinto the grid and new uses of electricityfor transportation can be supported.However, many technological andbusiness case questions remain. It is nota future that will automatically evolve.
A senior executive from a leading UK utility company inour roundtable commented: “What we are building themeters to withstand is not in our hands because of thecompetitive nature of the market. It poses a lot of risksand challenges for us. The communications technologywill ultimately be decided by the regulator through thecreation of a data communications company but, in themeantime, we have to make assumptions.”
Mark Coyle of Bglobal, a smart energy infrastructure andinformation services company, says: “The key thing werealised when rolling out meters is to separate outcommunications from the meter and make themextensible through easy upgrades without having tochange the meter. If you look back at communications10 years ago, it was a completely different world and itwill be a completely different world in a decade fromnow or even two or three years’ time. It is vital to makesure you don’t rollout something that would have to beredeployed or even disposed of.”
As the smart grid develops, the presence of companiesand brands from outside the utilities market is likely tobecome more visible. Luk Sterckx, CEO of SPE-Luminus, Belgium’s second largest gas andelectricity utility, says: “If you look at the horizontal levelthere are very strong interests from the telecoms andonline/IT sectors and, potentially, from appliancemanufacturers. These parties and interests are going toplay a role in a very big battlefield which we have notreally seen the beginning of yet.” Both Google andMicrosoft are active in looking at what can be done withthe data, how best to present it and enhance thecustomer experience.
Stephen Knight, chair of PwC’s UK smart meteringgroup, points out: “Smart metering reduces barriers toentry because it simplifies the energy market. Thisprovides an opportunity for specific offers of the kind weare seeing from Google with its energy monitoring tooland, potentially, for actual home energy retailing offers.Brands who have built up trust with customers may beattracted to an energy retail space which will be moreautomated.”
The wider interest in smart meters was evidenced inSpring 2010 when Google joined with 46 othersignatories in a letter to urge President Obama to adopta goal of providing every household with real timeinformation about their electricity use1. The list ofcompanies signing the letter was dominated by bignames from outside the immediate utilities sectorincluding General Electric, Hewlett Packard, Intel, Nokia,Verizon and Whirlpool.
04 The extent of change
1 A letter to the President of the United States, The Climate Group, April 2, 2010.
Tomorrow’s potential
The necessary ‘glue’ to ensure system cohesion is stillthe subject of debate and development. Manygovernments and regulators are still deliberating overthe right policy frameworks. Technology is evolving andthe market for ‘smart enabled’ products for customers,such as ‘smart’ domestic appliances, is yet to emerge.
Smart metering typically has a strong business casewith return on investment in the form of workforcesavings, billing accuracy and automation. However, forother smart grid initiatives such as e-mobility, thebusiness case might work at a ‘whole system’ level butis not sufficient at a ‘single player’ level. Michael Hurley,PwC’s global energy and utilities advisory leader,observes: “Many smart grid projects have benefits forthe whole energy system and wider markets and societythat don’t accrue just to the company making theinvestment. Frameworks have to be devised so that thisinvestment is appropriately rewarded.”
Hurley’s point is taken up by Jon Stromsather, Enel’ssenior smart grid manager: “The business case isn’tthere as a DSO to do this by ourselves so it won’t bepossible without the active involvement of theregulators. If not, we are going to be here in 10 yearsand talking about pilots again.” His views are echoed byPG&E’s Jim Meadows: “Smart grid is a challengingbusiness case. Smart metering is easy enough becausethere are a lot of operational savings and a lot ofprogrammes that can now be offered to customers.After that it will be much more of an incrementalapproach because it is not so obvious how you grow itfrom here without a more holistic approach. But thebackbone is in place – the base to start from.”
An area of significant uncertainty is communications andstandards. There is great variance in choice ofcommunications technology between Europe and NorthAmerica. In competitive markets such as the UK,companies face additional risk.
The extent of change 05
In California, a major part of the drive to rollout smartmetering came from the experience of rolling blackoutsin 2000 and 2001. Blackouts occurred on summer dayswhen peak load was at its highest and demandexceeded supply. There were ways to interact withcommercial customers who drew the heaviest loads byoffering them demand programmes but, without smartmeters, it was not possible to have a more dynamic wayof managing demand from small commercial andresidential customers.
The goal of shaving demand on peak days is already beingachieved. SmartRate is a tariff that accompanies PG&E’sSmartMeter™ programme. Already there are 25,000 peopleactive in the programme resulting in 16% peak demandsavings on critical summer days. Jim Meadows, PG&E’sdirector, SmartMeter™ field deployment, heads the projectmanagement office responsible for delivering the company’sseven year smart meter installation programme. Heexplains: “SmartRate customers get an energy saving therest of the time if they can cut their consumption on criticalpeak days. They get a text, e-mail or phone call a dayahead and know that, if they can find a way to turn the aircon off, maybe get out of the house, make it to a movie orthe beach, then they will save money.”
The numbers sound small but Meadows points out that “itdoesn’t take that many people to do the right thing on a hotday to make the business case pay off. You only need 15%to 20% of people to make it a winning business case.”Peak load shaving is just part of the picture for PG&E’ssmart meter rollout. The full implementation will bringsubstantial savings in meter reading and management costsas well as losses arising from older inaccurate meters. “Theoperational end game is US$170 million of savings. Beforesmart meters, we had a 1,000 strong meter field force andwe read every account each month for billing purposes.”
Spotlight: California and Italy – smart metering in action
In Italy, Enel is reaping similar substantial rewards from itsfirst mover investment in smart meters and associatednetwork innovations. The company’s investment was madeon pure business grounds without any regulatoryprompting. Jon Stromsather, Enel’s senior smart gridmanager, says: “It has brought huge benefits. We haveachieved a dramatic quality of service improvement and areduction in operating expenditure. On an investment ofEuro 2.1 billion we have had estimated annual savings ofaround Euro 500 million – a payback time of little morethan four years.”
Like PG&E, Enel’s opex savings have come from workforcesavings. Paolo Scuro, smart grid project manager at Enel,says: “We had 19 million remote activities in 2009 – thingssuch as contract changes, connections, disconnections,reconnections etc. Previously, all of these would haveneeded a worker in the field if we didn't have the smartmeter system and associated automation. We went froman operational cost of about Euro 80 per customer in 2001to Euro 49 in 2008, in large part thanks to the Telegestoreautomatic meter management.” Another benefit has beenthat smart meters have enabled a more flexible tariffstructure, with bi-hourly or flexible tariffs, day and night,peak and non-peak, etc. so that customers can savemoney and adapt their energy usage to fit supplycircumstances.
Enel’s smart meter rollout has been accompanied byparallel programmes covering network automation,workforce management, including all workers with hand-held tablet communications devices, and assetmanagement. Around a quarter of all the company’ssecondary substations are now remotely controlled,enabling much earlier interventions to correct faults.Stromsather points to “supply interruptions being cut from128 minutes in 2001 to 50 minutes in 2008 which, while itis still not comparable with some other countries, is quitegood given the state of the network in Italy.”
“It doesn’t take that many people to do theright thing on a hot day to make the peakshaving business case pay off.”
One participant in our roundtable observed: “it was easyto fall into the trap of it seeming like a meter installproject when we first started – worrying about thelabour, worrying about the supply chain and the qualityof equipment – but you quickly realise there is much,much more. Our project management office (PMO)started off with about 20 people but quadrupled in sizeto take account of all the controls you need coveringthings from vendor management to changemanagement.”
In this particular company’s case the PMO is focused onall aspects of the delivery of the capital project –procurement, quality assurance, workforce etc – whilewider corporate ownership of the project, and all theattendant implications for organisational change,customer and stakeholder relations, are managedthrough an operational steering committee. Again,ensuring the scale of change is understood andappreciated at the corporate level as well as the projectmanagement level is key to programme success.
It is essential that risk is not just dealt with at the projectlevel but also at the enterprise level. Something thatgoes wrong with the project could actually affect thewhole enterprise. It is essential to flow key project risksup into the enterprise and, if necessary, enterprise levelproject risks can flow down into the project. Manycompanies struggle with this. Conceptually it is easy butto actually do it for real can be tough. PwC seescompanies that are great at identifying lots and lots ofrisks but are not so adept at knowing which ones arekey and getting the right flows to happen.
The sheer size and complexity ofdeveloping smart grids should not beunderestimated. It involves integratingrenewable energy, enabling distributedenergy and planning infrastructure aroundelectric vehicles, to name a few of theelements. The challenges utilities areencountering, if not properly managed,could potentially hobble or derailambitious, multiyear smart infrastructurebuild-outs, some estimated at hundreds ofmillions of dollars.
The challenge for utility companies of managing smartgrids is all the greater as, in most cases, smart gridcapital expenditures are layered on top of already-expanding capital expenditure budgets. In the US, forexample, overall capital investment by the utilitiesindustry is estimated to reach US$75 billion in 2010,more than double that in 2004 (US$36 billion), accordingto one recent survey 2.
Just the smart meter component of smart grids is amassive undertaking on its own, typically requiring thereplacement of many millions of meters. It requirescomplex technology, supply chain, stakeholdermanagement and organisational change choices alongthe way. Daryl Walcroft, partner with PwC in SanFrancisco, is a major capital project managementexpert. He says “it is so important to treat a smart meterproject as a large capital project, with all its attendantgovernance, supply, stakeholder and public risk, and notjust as a technological rollout. There is no doubt thatsmart meter projects are mega projects. In ourexperience projects of this size need a different level ofcontrol to other projects.”
2 “Capital Expenditure Update”, SNL Energy, Financial Focus, March 25, 2010.
06 Getting it right
Managing project scale and breadth
Roundtable take-outs
Getting it right 07
“Organisations that underestimate the scaleof these projects risk being in trouble fromthe start.”
Project scale and breadth• Smart meter projects are ‘mega projects’.
• Increased level of complexity and scale requires an enhanced level of control.
• Regulatory environment and public awareness require careful management and consideration.
• Best practice examples and lessons learned can be taken from other sectors (e.g. energy, mining, transportation).
• Think about integrating systems with cost and risk management data, allowing probabilistic analysis, resource analysis and in some cases earned value analysis.
• Consider sophisticated estimate to completion (ETC) models that account for escalation factors and probabilistic inputs, giving realistic upper and lower time and budget forecasts.
• Get the basics right – apply controls and contingency management clearly and consistency across all aspects of the programme.
• Minimise technology risks by making communications extensible, this enables remote upgrades.
It doesn’t take a lot of customer complaints or publicconcern to cause problems. For example, in theNetherlands it didn’t take many people to get involved indata privacy issues in a way that has delayed smart griddevelopment by a number of years. As a result, theNetherlands is still facing uncertainty with regards to afull smart meter rollout in the near future.
Following pressure group activity and review by theDutch Data Protection Agency, a law enforcing the rollout of smart meters has been dramatically modifiedand remains delayed. Law makers and industry foundthemselves responding to public and political debateson data privacy rather than engaging with suchconcerns from the start.
Paul van Engelen, senior manager at PwC in theNetherlands, says: “The privacy discussion had a majorimpact on the smart meter rollout. Currently there arearound 300,000 meters in pilot programmes in the fieldbut we could have had a million or more in place by nowif privacy had not been an issue. Since the privacyconcerns became apparent Dutch grid companies havetaken initiatives to develop data privacy and protectionpolicies, a code of conduct and have started opendiscussions with different stakeholders. If theseinitiatives had taken place from the inception of the lawback in 2005, there would have been a good chance ofavoiding the legislative setbacks.”
Two way communication lies at the heart ofsmart grid technology. Its effectiveness,though, relies on such communicationtranslating into behaviour change. Smartgrid technology is for nothing if customersdo not adopt it and respond to it byconsuming electricity in different ways.Future smart devices may enableconsumption to be optimised automaticallybut, even with such technology in place,customers have to be won over and thereare many trust and other barriers toovercome along the way.
Indeed, in a media environment where issues such asdata privacy and technology malfunctions can grab bigheadlines, smart grid rollouts have the potential to makeor break reputations. The importance of the customer’sbuy-in to smart metering and the risk of potentialreputation impacts mean a strong emphasis must beplaced on customer communications right from the startof the project.
The very nature of a smart grid rollout offers a uniquecustomer relationship opportunity as Stephen Knight,chair of PwC’s UK smart metering group, observes: “It isa once in a lifetime opportunity to engage withcustomers but there is a fine line between winning theirfaith or losing their faith. It provides a face to facecommunications opportunity that will virtually disappearafter that.” Q&A and scripts for meter installers plusback-up information materials and dedicated telephonesupport for customers feature among the steps taken tooptimise this opportunity by companies in ourroundtable discussion.
With issues such as data privacy andtechnology malfunctions able to grab bigheadlines, smart grid rollouts have thepotential to make or break reputations.
08 Getting it right
Thinking about customers from the start
Getting it right 09
Elsewhere, smart meter rollouts have been hindered bysome clear ‘own goals’. In Australia, for example, criticalpeak pricing was introduced but information forcustomers was overlooked with the result thatunexpected high bills were then blamed on the smartmeter. A similar association of smart meters with highbills occurred in Canada when a new rate plan wasintroduced at the same time as a smart meter rollout.
Companies need to plan ahead and be mindful of thelikelihood that attitudes to smart meters will follow thecourse of what Knight describes as the ‘smart meterhype cycle’ (see graph below). They need to balance theneed to make customers fully appreciative of thepotential that smart meters can offer while alsomanaging expectations, mindful that not all features willbe available or accessible immediately. “Seeing thingsfrom a customer point of view is essential to gettingthrough the hype cycle as fast as possible and avoidingslipping into a trough where negative issues set in. Ifthat trough delays the upturn by three or four years thebenefit case is pretty shot,” says Knight
Energy savingand environmental panacea
Trigger Inflatedexpectations
Trough ofdisillusionment
Slope of enlightenment
Plateau of productivity
Smart is anindustry idea
Government see the opportunity to helpclimate change and fuel poverty
Smart will save you money Roll out begins and customer
communication intensifies
Customer outreachand education
Strong scope,schedule and budget management
Poor installationexperienceand education
Price shock
Customer disillusionment as promised benefits donot materialise
Suppliers start to provide innovative and customer focused product offerings
Customers see thebenefits of accurate bills and improved services Majority of customers
accept ‘smart’ as a good thing and broader benefits are recognised
Innovative approaches offer customers new choices and increase market competition
Managing the smart grid hype cycle
The potential for pressure group activities or a smallnumber of vocal complaints to hinder smart meterrollouts highlights the need for utility companies to havevery pro-active communications strategies at the heartof their smart meter programmes. A clear view shouldbe established on how the customer smart meterjourney is to be managed. Tight control on theprogramme and tracking early benefits can be used tobuild confidence by communicating how well theprogramme is progressing.
Systems for monitoring customer enquiries andcomplaints need to be aligned with the rollout so thatany emerging problems can be nipped in the bud.Customer and public information programmes should bedesigned to prevent and counter ‘smart meter myths.’Companies that downplay such communications andsee such projects in purely operational or technicalterms are not only unlikely to gain the full benefits ofsmart meter consumer behaviour change but also riskreputation damage.
Once negative attitudes start to appear, they gathermomentum and the smart meter can fast become aneasy target to blame for all sorts of unrelated things.Participants in our roundtable recounted instances ofhouse fires being blamed on smart meters andcustomers blaming the meter for being too accuratecompared to their previous old meters which might haveunder-recorded actual consumption. Harmful effectsfrom smart meter radio frequency (RF) emissions wereanother common scare story even though expert studiesshowed radio waves from a smart meter, at a distanceof 10 feet, are only about one one-thousandth as muchas a typical cell phone3.
The intensity of the debate around smart meters inCalifornia was such that the California Public UtilitiesCommission (CPUC) ordered an independent, third-party assessment of PG&E’s SmartMeter™ programme.The assessment, published in September 2010, statedthat the new meters are recording customer electricusage accurately. It also found that issues that aroseearly in the programme were limited in scope, werebeing "appropriately addressed by PG&E" and oftenreflected factors unrelated to the meters, includinghigher-than-normal energy usage caused by a heatwave.
The report for the CPUC was the second expert third-party evaluation of advanced metering devices inthe US. The previous assessment, conducted for theTexas Public Utilities Commission, concluded thatsimilar utility smart meters were also accurate.
10 Getting it right
Thinking about customers from the start
3 http://www.pge.com/myhome/edusafety/systemworks/rf/
“Companies need to have very pro-activecommunications strategies at the heart oftheir smart meter programmes.”
Getting it right 11
Roundtable take-outs
“Tight control on the programme andtracking early benefits can be used to buildconfidence by communicating how well theprogramme is progressing.”
Thinking about customers from the start • Begin customer engagement and education early and maintain throughout the rollout.
• Develop a deep understanding of your customers.
• Engage fully with privacy concerns, seek to shape the regulatory context and develop policies that make it clear how data is used and what it can’t be used for.
• Approach installation as an opportunity to improve customer engagement.
• Invest in strong project management and complaint monitoring.
• Have a clear customer journey in which expectations are managed by being explicit about the steps that need to be taken before the final destination is reached.
• Develop clear and compelling smart pricing to match smart meter capabilities.
• Examine ways to ensure that the advantages of smart meters are distinctive and don’tget blurred by other market changes or events that might be taking place.
• Seek to own the communications space by ensuring that the full facts about smart meters and smart grids are pro-actively communicated and avoid the danger of letting others fill a communications vacuum.
It is important for companies to have top level projectsponsorship for their smart meter programmes. If it isnot from the CEO, it needs to be jointly from the rangeof senior executives, such as the chief customer officer,regulatory officer and chief information officer, whoseinvolvement is mission-critical. In one sense, everysingle employee is involved as all employees have tounderstand the rollout and be ambassadors for it. Moredirectly, in terms of the way people do their jobs, manypeople’s jobs will change.
Job losses are inherent to realising the business benefitsof smart meters as the meter reading workforce is nolonger needed. At the same time, companies will needto strengthen the workforce in certain areas, particularlyinformation and communications technology (ICT).Enel’s Jon Stromsather says: “We had no big layoffs - ithas been natural turnover or people retiring. There hasalso been a lot of re-educating people as we becomemore ICT focused and, indeed, struggle to find the rightpeople. It is not only energy anymore, it is ICT. So it hasbeen a big change not only in numbers but also in termsof workforce capability.”
Harnessing the full benefits of smart meterand smart grid programmes entailssignificant organisational change as well asdifferent ways of working and thinkingwithin utility companies. Smart meters, forexample, have obvious implications for thesize of the field force and the way utilitycompanies approach the customerrelationship. Existing systems and dataneed to be cleaned up and modernised tobe smart grid ready. Utility companies haveto be ahead of the curve on issues such ascyber security and data processing and, assmart grids and home energy innovationsdevelop, the very role of utility companiesneeds to evolve into that of a home energyand clean energy ‘systems integrator’.
PG&E’s Jim Meadows is in no doubt of the importanceof working through the implications for the wholeorganisation of smart meters. “You need buy-in and totalcommitment of your whole company before you startbecause it will touch every aspect of the operation ofthe utility,” says Meadows. “There is no stone unturned.All the vice presidents that run the different divisionshave a stake and are ready to support the programme.We have directors from all areas of the utility on ouroperational steering committee, so they know what theplan is, can input their perspective and weigh up theimplications for the new programmes that need to berolled out.”
12 Getting it right
“It has been a big change not only innumbers but also in terms of workforcecapability.”
Working through the ‘whole organisation’implications
“There is no stone unturned. All the vicepresidents that run the different divisionshave a stake and are ready to support theprogramme.”
Getting it right 13
Roundtable take-outs
Working through the ‘whole organisation’implications• Ensure the programme sponsorship is high-level enough to gain buy-in and deliver change
across the whole organisation.
• Begin planning early and set smart meter rollout in the context of the wider automation, clean energy and customer relationship journey that you see yourself on.
• Think through the implications for the part that your company plays in the marketplace and what your emerging role as an integrator of clean energy generation and home energy management systems means for business, customer and stakeholder relationships.
• Engage with the workforce and trade unions early and plan opportunities for natural wastage, redeployment and new skills development.
• Examine the implications for cultural change, particularly in how you think about the customer relationship, embrace issues such as cyber security and privacy and what real time automation will mean for your employees.
• Address skill shortages or existing data or system shortfalls early so that you are not caught out in ways that endanger your programme.
14 Getting it right
1 Are you recognising the scale and reach of your smart grid rollout and matching that with an appropriate capital project planning, risk and governance framework?
2 How far ahead of time are you planning? Have you considered the advantages of techniques such as ‘front end loading’ using a stage-gate process to plan more fully and robustly early on?
3 Do you have strong and realistic understanding of the concerns of customers and the wider public right from the start and are you addressing this in your project plans and communications?
4 Are you influencing and shaping the regulatory framework in a way that will optimise smart grid development? Are you addressing the data privacy and security aspects of policy as well as the energy regulatory context?
5 How are you addressing technological risk? How ‘future proofed’ are your technological choices and have you got the right arrangements in place with suppliers and partners to maximise your smart grid benefits?
6 Is your customer journey clear? Are you making the most of the opportunity given by smart meter rollout?
7 Are you developing innovative smart pricing offers and taking particular steps to make sure your customers’ early experience of smart meters is positive and not undermined by price hikes or other shocks?
8 Do you have a pro-active communications strategy to get the facts across about smart meters and dispel the myths?
9 Are you matching smart grid change with parallel ‘whole organisation’ change? Do you have the right mechanisms to get buy-in and deliver change across the organisation?
10 Are you thinking through the implications of your emerging role as an integrator of clean energy generation and home energy management systems for your business, customer and stakeholder relationships and your positioning in the marketplace?
Checklist
15Contacts
Global Contacts
Manfred WiegandGlobal Utilities Leader+49 201 438 [email protected]
Michael HurleyGlobal Energy, Utilities & Mining Advisory Leader+44 20 7804 [email protected]
Territory Contacts
AfricaMark Ally+27 11 797 [email protected]
Jan Gey van Pittius+27 11 797 [email protected]
AustralasiaBrian Gillespie+61 7 3257 [email protected]
Darren Smith+618 9238 [email protected]
Harry Koller+612 8266 [email protected]
AustriaGerhard Prachner+43 1 501 88 [email protected]
Erwin Smole+43 1 501 88 [email protected]
Bernhard Haider+43 1 501 88 [email protected]
BelgiumBernard Gabriels+32 3 259 [email protected]
CanadaPenny Rae+1 403 509 [email protected]
Brian Pawluck+1 604 806 [email protected]
Janet Rieksts-Alderman+1 506 653 [email protected]
ChinaGavin Chui+86 10 6533 [email protected]
Hongbin Cong+86 10 6533 [email protected]
DenmarkPer Timmermann +45 3945 [email protected]
Finland Juha Tuomala+358 9 22 801 [email protected]
France Philippe Girault+33 1 5657 [email protected]
GermanyRalf Kurtz+49 211 981 [email protected]
Christian Hahn+49 30 2636 [email protected]
16 Contacts
GreeceSocrates Leptos-Bourgi+30 210 687 [email protected]
IndiaKameswara Rao+91 40 2330 [email protected]
IrelandDenis O’Connor+353 1 792 [email protected]
ItalyGiovanni Poggio+390 6 57025 [email protected]
Latin AmericaJorge Bacher+54 11 5811 [email protected]
ArgentinaMarcelo Iezzi+54 11 4850 [email protected]
BrazilGuilherme Valle+55 11 3674 [email protected]
ChileRafael Ruano+56 2 940 [email protected]
Middle EastIsmail Maraqa+962 6 [email protected]
NetherlandsJeroen van Hoof+31 088 792 1328 [email protected]
New ZealandCraig Rice+64 9 355 [email protected]
NorwayOle Schei Martinsen+47 95 26 11 [email protected]
Ståle Johansen +47 9526 [email protected]
Russia & Central and Eastern EuropeDave Gray+7 495 967 [email protected]
John Wilkinson+7 495 967 [email protected]
SingaporePaul Cornelius+65 6236 [email protected]
SpainGonzalo Sanchez Martinez+34 946 022 [email protected]
SwedenMartin Gavelius+ 46 8 555 335 [email protected]
SwitzerlandRalf Schlaepfer+41 58 792 [email protected]
United KingdomAnthony Morgan+44 20 7213 [email protected]
Qadir Marikar+44 20 7213 [email protected]
Steve Randle+44 20 7213 [email protected]
Duncan Michie+44 20 7804 [email protected]
Stephen Knight +44 20 7212 [email protected]
Dennis Mahoney+44 (0) 20 7212 [email protected]
Ross Hunter+44 20 7804 [email protected]
United StatesStephen Lechner+1 415 498 [email protected]
Daryl Walcroft+1 415 498 [email protected]
Matthew Labovich+1 703 918 [email protected]
Further information
Olesya HatopGlobal Energy, Utilities & Mining Marketing+49 201 438 [email protected]
Contacts 17
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