Why Dell is exploring smart grid opportunities

Why Dell is exploring smart grid opportunities

The convergence of information and communications technologies (ICT) with the traditional operations technologies (OT) is an ongoing smart grid trend.   Within the U.S. -- and its more than 3000 electric utilities -- smart grid investments are increasingly focused on optimizing grid operations through machine to machine (M2M) communications and forays into data analytics for applications ranging from revenue assurance to voltage conservation.

This ICT/OT convergence trend is encouraging new entrants into the vendor ecosystem that supports electric, gas and water utilities. One of the latest entrants is Dell Computers. Dell made two announcements recently that illustrate how ICT companies are exploring smart grid market opportunities. 2013 will be the year to watch their strategies and progress.

Dell recently unveiled their Smart Grid Data Management Solution which combines high-performance computing, networking and storage to manage data for review and action in utility operations. Leveraging domain expertise, and the PI System from OSIsoft, they developed and tested a reference architecture in a simulation environment that modeled a utility's transmission grid operations.

This is a noteworthy collaboration between a traditional ICT vendor (Dell) and a traditional OT vendor (OSIsoft) that is focused on grid operations. Dell’s solution coupled with OSIsoft’s provides faster updates and makes actionable data available to staff, applications and business systems and is an excellent example of how M2M communications and data management technologies can become ubiquitous in the smart grid.

But Dell has also signaled its intent to get involved in the consumer side of the electricity value chain by joining the Pecan Street Inc. Advisory Board.  Pecan Street is an energy and smart grid research and development organization, and serves as a living laboratory with a community microgrid characterized by residence-based solar generation, electric vehicles (EVs), energy efficiency and energy management solutions for homes.  The project is conducting research in the brave new world of consumer/prosumer evolutions and their energy interactions through data analytics.

While the term "big data" is used in this project, its volumes are dwarfed by the volumes of data that are generated by today's grid testing deployments.   Similarly, if smart meters ever provide data to utilities at 15 minute intervals, that would constitute really big data, at least as analytics providers in financial services or telecommunications would define it.  It's more accurate to describe the Pecan Street project as one that offers horizontal complexity and scalability as the types of devices, with all their variations in hardware, firmware, and software will need to be managed in addition to the networks that connect them.  There aren’t too many analytics companies out there that can offer this expertise, and the best ones are proven performers in other industry sectors outside of electric utilities.

However, Dell has proven abilities in the arena of data management, and they understand a thing or two about consumers after successfully building a competitive business that sells direct to them. So their moves into the smart grid sector portend more than a continuation of the ICT/OT convergence trend.  It also highlights another trend: Businesses experienced in consumer retail operations (such as Verizon and Comcast) are exploring activities to directly engage with electricity and water consumers.

Traditional utilities may discover that their business models are disrupted more by this second trend than the first.  Of course, this second trend is a riskier play, and it is too early to tell if these new players will become intermediaries between consumers and utilities.  It will be interesting to watch Dell in 2013 and see how these trends progress.

Grid conceptM by Risto Vista via Shutterstock