Digital technologies are transforming our lives in unimaginable ways. When we look into the energy sector, it has undergone a digital transformation over the last few years. And this has visibly improved the efficiency and safety of the building, and it has facilitated the increased use of renewable energy.

Currently, the industry is at a tipping point of exponential technological advancement. We are already witnessing this with the internet of things generating and sharing data. Machine learning and artificial intelligence are already automating and optimizing operations. Digital technologies are driving cost efficiency, providing new revenue opportunities, and changing business models. 

CM today speaks to industry experts on this transition in the energy sector. The report delves into the benefits, the trends, and the impact it has on the relationship between energy companies and their clients. 

The energy sector across the world is undergoing sweeping changes, with decentralization, digitalization, and sector coupling. This is giving rise to new processes and business models. In the region, the phenomenon is not completely new. Many companies have moved on to the path of digitization and shown innovative results to their clients. 

The transformative change can be seen with workers, who have been forced to adopt new digital tools for remote work, and the status quo has been disrupted.

Digital innovation through the use of predictive analytics to better anticipate the future, data to better inform current decisions in the here and now, and digitization and automation to deliver cost efficiencies and speed is driving renewed growth energy organizations globally.

Organizations that have pivoted to digital successfully are already generating up to 2 and 10 percent improvement in expanded production and up to 30 percent savings in cost.

An industry report showed that the main barriers to the implementation of changes provided by digitalization are due to limited knowledge sharing (77%), insufficient digital training (74%), and a lack of digital talent (72%). Regarding the lack of digital talent, 2019 data from oil and gas companies, collected by KPMG, found that chief information officers (CIOs) feel there are skills shortages in business analysis (47%), big data/analytics (41%), artificial intelligence (37%), cybersecurity (35%) and enterprise architecture (33%).

Wael El Khatib, who currently serves as Director - IT, Digital and Call Center across all of Enova's operating countries, talks about how digital transformation in the energy sector has redefined the relationship between energy companies and clients. 

“Nowadays, real-time data and analytics are available from any device and at any time. Dashboards can be customized to suit a client's exact needs – all relevant KPIs at a glance. Our clients appreciate this increased operational visibility and performance transparency,” he adds.

As part of his role, El Khatib has spearheaded the design and implementation of the company’s Digital Strategy for the last years. And has been the driving force behind many of Enova’s digitalization, automation and cybersecurity efforts including the transition of the company’s infrastructure to the Cloud.

“Big data and IoT bring endless possibilities and Enova is continuously looking into new ways to harness operational information and devise new value-add solutions for customers and building occupants of the smart built environment,” he explains. 

El Khatib goes on to add that through pure data-driven Energy Conservation Measures (ECMs), Enova is now capable of achieving savings without any CAPEX investment. “This solution is powered by Enova’s smart monitoring platform Hubgrade and the case study of MAF Tower 2 shows a real-life success story. The most recent information display innovation is the live CO2 and temperature data in the Enova by Veolia app, allowing clients and operational staff to track customer-centric KPIs in real-time,” says El Khatib.

Talking about the benefits of digital transformation in the energy sector is Robert White, Head of Technology and Innovation, ENGIE Solutions Middle East. He says that the energy industry, in particular, has been an early adopter of 4IR technologies. A Markets and Markets report estimates the value of AI in the oil and gas industry will reach $2.85 billion by 2022, growing 12.7% percent annually. “With the ongoing pandemic, there is now a greater need for automation and supporting technologies such as predictive artificial intelligence, machine learning, Internet of Things, to analyze demand, manage and optimize operations,” he adds.

Through technological and data-fuelled business models, the energy industry is shifting from a traditional cost management approach towards tangible optimized business productivity. And Robert says that this provides environmental and operational efficiencies including utility use, analytical, reactive, deployment, and communication. “It also has a direct impact on reducing costs, improving internal infrastructure, and helps energy players reduce their overall carbon footprint,” he adds.

As organizations in the energy sector continue to incorporate energy-efficient technologies into their strategies, there is also an ongoing global momentum towards the transition to carbon neutrality. 

In the Middle East, countries have pledged to take collective efforts to accelerate climate action for the success of the Paris Agreement. At the Regional Dialogue for Climate Action, the UAE, Oman, Kuwait and Qatar called for enhanced Nationally Determined Contributions and net-zero commitments ahead of the 26th United Nations Climate Change Conference of the Parties (COP26). Moreover, national strategies have been launched, such as the ‘UAE Energy Strategy 2050’, and Saudi Arabia’s renewable energy strategy, which is in line with the Vision 2030 framework to reduce the Kingdom’s carbon footprint.

“The pandemic has also caused many disruptions in the industry and is creating a greater need for the energy industry to evolve and create a sustainable carbon-neutral economy. Together, there is an urgent need for organizations to incorporate technologies that will not only increase efficiencies but also positively impact the environment,” explains Robert.

New and innovative technological solutions are optimizing energy use, reducing client costs across their portfolio, and freeing up resources. Robert takes the example of ENGIE Solutions, where they have developed and implemented a Smart Operation and Maintenance (O&M) and Energy services platform. 

“This solution was developed in response to our identification of market expectations, where customers expect more value from service providers managing their assets while keeping costs as low as possible. ENGIE Solutions aims at designing & delivering differentiated O&M offerings to address the market needs in a disruptive way,” he states.

Technologies such as Artificial Intelligence (AI) and Machine Learning (ML) are used to collect and analyze live asset data from buildings, to make data-driven decisions about asset operations. This combined with O&M and Smart Building technologies, allows organizations to remotely and proactively monitor the operation and maintenance of assets. Organizations can then predict maintenance issues before assets fail, thereby making data-driven decisions about asset lifecycle and replacement.

“Additionally, IoT is one of the main drivers for the digital transformation of energy sector operations,” adds Robert. “IoT sensors monitor changes in temperature, current, and vibration, making it possible to prevent equipment failure. Faults are identified early enough and rectified, minimizing downtime,” says Robert.    

In conclusion, it is interesting to see how such technologies are not only driving energy efficiency but are also positively impacting the organization’s bottom line and helping organizations to decarbonize in total. The transformation has certainly laid down the path for more new building owners to adopt more such solutions for a more sustainable tomorrow.