Integrating the customer experience through unifying software - The Microsoft Vision

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1 VAASAETT - RESPOND 2010 Integrating the customer experience through unifying software - The Microsoft Vision Principal Author Andreas Berthold- van der Molen, Microsoft EMEA Contents The New Energy Ecosystem Connecting with Customers in the Home Current Platform Constraints The Microsoft Approach Performance Oriented Infrastructure Holistic Life- User Experience Network Optimization Conclusion EXECUTIVE SUMMARY Power utility companies are facing fundamental changes in the nature of their future business relationship with customers. They need new capabilities to inform consumers about their role in a new energy ecosystem. This new ecosystem is one where consumers can use electricity in a cost- rational manner and also contribute to the grid with distributed renewable generation sources. Finding the right technology platform to create that environment is a primary challenge for utilities. In our view utilities must integrate their utility business operations and their underlying technology enablers with consumer behavior in order to be successful. 1

2 The New Energy Ecosystem In many places around the world, utility consumers are already entering the marketplace as active participants. New Web- and computer- based programs are enabling them to learn more about their energy consumption and they creating the desire in consumers to take more control of their electricity spend. Who doesn t want to lower their bills when they can? But consumers aren t the only ones changing the game. Instead of undertaking the extreme capital expense of building new plants, utilities are looking to make energy efficiency and demand response the first fuel choice. When consumer use of home management programs becomes more widespread they will create new usage patterns that, in turn, will cause transmission and distribution grid planning and operations to change as well. The adoption of energy efficiency technology, distributed generation and demand response will all serve to transform the pattern of what now is considered normal energy flows. We term the new environment a smart energy ecosystem. In this new environment, the historical one- way radial flows will be redefined and control of energy demand and supply behaviors will shift to the consumers. Demand response and price sensitive load response must also grow in order for utilities to realize the benefits of their investments in smart meters and advanced metering infrastructures. As a result, utility companies will need IT systems to deliver these energy efficiency and demand response programs, customer self- service capabilities, outage reporting and notifications, customer service and relationship management, new billing options and pricing calculations, and home energy management. And therefore it s necessary that the utility company s IT architecture will extend farther into the home for security, load control, customer care, and billing. Connecting with Customers in the Home The result of these transformative trends will be what Microsoft refers to as the Connected Home, where energy efficiency technologies become integrated into the 2

3 fabric of an enabling Web- based cloud and premise technologies - - transforming customer care and service into a highly interactive and mostly consumer- controlled environment. For instance, the smart energy ecosystem will likely need to accept power coming from the solar arrays on the rooftops of commercial buildings and private homes. It will also need to incorporate power coming from strong, but variable, wind farms. When millions of individuals own plug- in hybrid electric vehicles (PHEVs), a smart energy ecosystem will conceivably allow them to buy electricity from the grid during late night, non- peak hours. Then, if the grid needs power during peaking events, the utility might draw from the stored power in those very same PHEVs. Indeed, utilities are already deploying many devices with the microprocessors and two- way communication that will enable a wide variety of capabilities not possible before, including collection of more information, local decision- making and coordination. Current Platform Constraints Before this vision is realized, the transmission grid has operational constraints that still need to be carefully managed. Distribution network constraints will become more apparent as consumers purchase more PHEVs and deploy more distributed resources. For instance, where a distribution feeder may have been designed for average customer loads of 1.5KW, the charging cycle of a single PHEV can add a load of up to 20KW. As more PHEVs come onto the grid, they can easily exceed the capacity of a distribution feeder, requiring large scale physical upgrades and/or coordination of PHEV recharging. The utility will prefer the coordination option, in order to minimize peaks and provide for balanced operation of feeders within their designed limits. New factors and their constraints are emerging around the basic utility function of metering. In the past, it was only possible to measure usage for all but large consumers on an aggregate monthly basis. With advanced meter deployments, it is now possible to measure usage for all customers in near real- time on an interval basis, where all customers usage may be reported every 15 minutes. Such interval reporting provides 3

4 new opportunities to charge customers more for electricity consumption during more expensive peak hours, or provide reduced rates for usage during off- peak hours. This time- of- use pricing provides customers with the incentive to change their consumption behaviors and/or leverage devices within their home or business to rationalize overall energy costs. The communication infrastructure used for the advanced meter then becomes a gateway between the customer and utility or service providers for additional services including demand response, outage detection, power quality monitoring, etc. The Microsoft Approach Microsoft views the new Smart Energy Ecosystem as one requiring a five- pronged approach, as seen in the figure below. In the context of creating the vital connection with the customer, we will focus on the first three components: a performance- oriented architecture, a holistic life- user experience, and an optimized energy network. 4

5 Performance Oriented Infrastructure For the utility s benefit, a performance oriented infrastructure would include those features that make an information technology architecture complete and appropriate to business needs. These include: Economic: The infrastructure must provide cost effective means to deploy and integrate functionality. Deployment: Components have to consider flexibility in how and where they can be deployed. Location agnostic: Services are designed so that they can be deployed on- premise or in the cloud. Always connected: Users and software components have access to platforms and services wherever they are located. Manageability: Infrastructure components can be efficiently deployed, managed and monitored. Transferability: Functionality and information can be migrated easily from one version of underlying infrastructure components to another with minimal interruption or intervention. Secure: Deployed components, functionality and associated information are protected from unauthorized access or malicious attacks. High performing and scalable: Support for more users, larger models, increased transaction volumes, etc. can be accommodated through increasing hardware performance (scale- up) or the linear addition of hardware and network resources (scale- out). Virtualization: Components can be deployed in a manner that optimizes the use of hardware resources. Highly available and self- healing: Support for transition to new equipment in the event of equipment failure. Disaster recovery and backup: Capability to move to a new platform or facility or recovery from a natural disaster or terrorist event and the back- up of results to facilitate the transition. 5

6 Holistic Life- User Experience For the consumer s benefit, the utility s information technology architecture must enable a holistic life- user experience that enables all participants to view the smart energy ecosystem from the perspective of other participants. To Microsoft, this equates to ensuring that the host company understands how customers experience the world and how technology fits into that experience. A technology architecture that facilitates the smart energy ecosystem will then necessarily consist of: A rich, integrated technology user experience for home, car, control center and field workers. Browser- based collaboration using rich clients rendered appropriately across a multitude of devices. Supporting functionality for collaboration and mashups through the use of Microsoft Office SharePoint Server and services. A unified communications infrastructure, where the nature of the underlying communication infrastructures are transparent to users. Energy Network Optimization Finally, for the purpose of connecting the utility to the consumer to create this environment, Microsoft s vision for an integrated technology platform requires the following: Flexible communications: Deployments can leverage a variety of communications paths and technologies and are easily reconfigured minimizing the time required to make new information available to users. Smart connected devices: Intelligence is added to devices and they are connected to the communications network enabling both intelligent autonomous operation and visibility of the operation of the network. 6

7 Desktop, server, embedded and mobile operating systems: Operating systems (OS) can be effectively employed leveraging the right OS, at the right level, for the right role, with the right performance. Application architecture: This is the architecture for applications infrastructure and services for commonly used capabilities so developers can focus on domain- specific functionality optimizing speed to market and the reliability of solutions. CONCLUSION Finally, in our view, there is no existing software application that achieves all of these requirements to enable tomorrow s smart energy ecosystem. Instead, the final architecture must be able to use all or most of the utility s existing IT infrastructure in a manner to create the above environment. Where those existing pieces fall short, they need to have bridge components are familiar to use and allow easy integration and agility. In our view, Microsoft offers all the required connecting components that, in many cases, are already in use at utilities around the world. It s a matter of understanding the vision for where the sector is headed and what s needed to tie it all together. 7

8 8 RESPOND 2010

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