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Digital technologies’ impact on business earnings

Accenture has issued the results of its survey investigating the impact of digital technologies on the earnings of energy distribution companies.

The study, Digitally Enabled Grid research programme, in its fifth year, is based on a survey of 150 utility executives across over 25 countries.

94% of utility executives believe distributed earnings growth will be severely pressured until 2025.

Factors negatively impacting on an increase in earnings include:

  1. Network capital investment levels falling below depreciation
  2. Increasing targets for service reliability and performance regulation
  3. Energy demand erosion

However, 97% of executives said they believe distribution earnings will grow beyond 2025.

Efficiency and improved network performance owing to digital technologies and new business models will drive increases in earnings.

Energy distribution businesses challenges

Other key findings include:

  • Regulatory pressure and new technologies shifting consumer dynamics
  • 93% of executives say energy distribution businesses are struggling to deliver the benefits of digital transformation
  • The performance of other utilities cited the greatest threat of utility business
  • Key technologies to have greater impacts on operations are Autonomous vehicles (59%), digital twin (55%), AI (54%), augmented and virtual reality (47%), blockchain (44%) etc
  • Utility executives expect to become the trusted third-party provider of energy-related data services to consumers

Stephanie Jamison, a managing director at Accenture who leads its Transmission and Distribution business, said: “Improved operational performance will be key to succeeding in this transition. Distribution businesses have the opportunity to become intelligent grid optimizers, developing and scaling advanced grid operations capabilities to accommodate, operate and navigate a fast-changing ecosystem of energy devices being adopted for homes and businesses.”

“Distribution companies have the opportunity to lead the debate about the most effective regulatory model to support the electricity system.”

Jamison added: “The model should foster innovation, expand customer choice and deliver efficiency while providing the opportunity for the highest-performing businesses to reap financial rewards. Distribution companies are well-placed to help accelerate the transformation process to create a more-distributed, low-carbon and customer-centric electricity system.”

The study was conducted in countries including Brazil, Canada, the UK, and Germany.

This article was featured on our sister website Smart Energy International

Babalwa Bungane
Babalwa Bungane is the content producer for ESI Africa - Clarion Events Africa. Babalwa has been writing for the publication for over five years. She also contributes to sister publications; Smart Energy International and Power Engineering International. Babalwa is a social media enthusiast.