Water Utilities Trends Report
An industry strategic foresight trends report.
Water utilities are overwhelmed by the number of unprecedented changes and disruptions in the industry. Facing uncertainties about transforming the digital business to adopt rapidly changing technologies, leadership teams often lack insights to identify relevant and critical trends.
Our Advice
Critical Insight
When facing disruptions and uncertainties, water utilities need to focus on strengthening their core business capabilities and embracing technology advancements to bolster business resilience.
Impact and Result
Info-Tech’s Water Utilities Trends Report investigates strategic foresights and identifies the relevant trends for water utilities. Our aim is to guide you through this transition and help create a sustainable future we can all imagine together.
- Perform a broader scan to highlight the demonstrated and relevant trends to water utilities.
- Demonstrate how industry leaders capitalize water utilities tech trends.
- Highlight the opportunities and risks associated with these trends.
- Provide practical recommendations on people, process, and technology.
Water Utilities Trends Report
An industry strategic foresight trends report.
Analyst Perspective
In the past year, the world has witnessed a spate of water-related disasters. Record-breaking droughts in the western United States is one of the many wake-up calls that we have been getting. The cracks in Lake Mead painted a vivid reality of the severity and urgency of the water crisis we are facing. Devastating floods worldwide have forced millions of people to evacuate and left many homeless.
Nature is giving us no choice but to change. Water utilities, providing one of the most essential services to societies and communities, have a crucial role to play in changing the trajectory of the water crisis. In the face of challenges, water utilities must embrace collaboration and innovation.
Technology leaders must become strategic partners with business leaders to proactively plan and transform their operations to ensure their future resilience. Info-Tech’s Water Utilities Trends Report investigates strategic foresights and identifies the relevant trends for water utilities. Our aim is to guide you through this transition and help create a sustainable future we can all imagine together.
Jing Wu
Principal Research Director,
Utilities Research
Info-Tech Research Group
Executive Summary
Your ChallengeWater utilities are overwhelmed by the number of unprecedented changes and disruptions. Leadership teams often lack insights to identify relevant and critical trends. There are uncertainties about transforming the digital business to adopt rapidly changing technologies. |
Common ObstaclesUtilities leaders often think IT does not have an important role in defining and achieving digital business goals. Risk-averse utilities do not see the value of trends or how they link to the digital business plan. IT leaders might not think that industry trends have a significant impact on the IT organization. |
Info-Tech’s ApproachPerform a broader scan to highlight the demonstrated and relevant trends to water utilities. Demonstrate how industry leaders capitalize on water utilities tech trends. Highlight the opportunities and risks associated with these trends. Provide practical recommendations on people, process, and technology. |
Info-Tech Insight
When facing disruptions and uncertainties, water utilities need to focus on strengthening their core business capabilities and embracing technology advancements to bolster business resilience.
Water pressure is on the rise
Source: “Water Stress,” Statista, 2022
“Quickening urbanization, population growth, climate change and economic development are placing pressure on water systems.”
Source: The Economist Intelligence Unit, 2021
Water operations interconnect with the digital environment
Consider the digital water journey through different lenses
Digital transformation is key to developing resilience in water utilities and strengthening business capabilities. Those who seize the opportunities to embrace the paradigm shift will set the stage for the future of water utilities.
Customer: A customer-centric approach to improve customer services and engagement while providing reliable, equitable, and affordable services
Water Utilities: A business model shift that supports sustainability, resilience, efficiency, and a digitally native workforce
Digital Team: Accelerated adoption of data-driven decision making, enterprise governance, and service agility
Download the Future of Utilities Trends Report
The future of utilities: foundational IT elements
The business requires leadership from it for digital transformation to succeed
Work and Asset GIS Systems
Effective use of a GIS-powered work and asset management system can streamline location-aware operational workflows such as inspections and maintenance of water infrastructure.
Customer Engagement
Elevated external customer expectations require utilities to provide an intuitive, unified omnichannel platform to interact with customers for all services provided.
Digital Workforce
Deployment of mobile devices and applications to assist frontline workers and backoff employees with near-real-time data to support their daily operational tasks is essential to realize the benefits of the digital transformation of utilities.
Hybrid Integration
A hybrid framework to support various integration patterns such as on-premises to on-premises, on-premises to cloud, and cloud to cloud is key to enable smooth business workflows.
Cybersecurity
A robust cybersecurity program covering IT, operational technology (OT), and internet of things (IoT) landscapes is critical to ensure organizational information and assets are protected against the various forms of attack.
Advanced Data analytics
The enablement of an advanced data analytics platform to support data-driven digital utilities is the foundational step necessary to support any core business transformation initiatives.
Water utilities: four transformational trends
SUSTAINABILITY FOR WATER UTILITIES
Finding your pathway in the race to net zero
Water utilities play a role in contributing to the net-zero target. An achievable sustainability plan is becoming a top priority for water utilities and smart cities.
NETWORK TRANSFORMATION
Building a resilient physical and digital infrastructure
Water stress caused by extreme weather patterns, expanding urbanization, and growing populations require water utilities to optimize their investment in maintaining the aging physical infrastructure and building up its digital twin to provide further insights.
CONNECTING WITH THE EDGE
Expand digital intelligence
Evolving from the pervasiveness of internet of things (IoT) devices, edge devices allow decentralized computing to complement conventionally centralized decision making.
DARE TO INNOVATE
Networks of collaboration to challenge the status quo
The challenges utilities face are complex in nature and require collaboration across nations and borders. It is necessary to rethinking innovation in utilities during the utility transformation period to realize potential benefits of efficiency, cost savings, and client satisfaction.
Next step
Leverage this trends report to develop your digital business strategy
Leverage this trends report for priorities that drive measurable, top-line organizational outcomes and to unlock direct value.
The future will bring more trends and technologies, making it pivotal that your utility continues to establish itself as the disrupter, not the disrupted. You must establish a structured approach to innovation management that considers external trends as well as internal processes. Info-Tech’s Define Your Digital Business Strategy and Build a Business-Aligned IT Strategy blueprints give you the tools you need to effectively process signals in your environment, build an understanding of relevant trends, and turn this understanding into action.
Trend 01
Sustainability for water utilities
Finding your path in the race to net zero
Water utilities play a role in reaching net-zero target
|
Water utilities are contributing to a warming world. Energy-intensive wastewater collection and treatment operations represent 62% of greenhouse gas (GHG) emissions in the water sector. According to a Xylem report, 50% of energy-related emissions in the wastewater sector can be reduced using existing technology. Source: “We need to rethink,” WEF, 2022; Global Water Intelligence, 20222%of global GHG emissions are from the water and wastewater sector, on par with the shipping industry. Source: “How the water sector is using innovative tech,” WEF, 2022 |
Water is tightly connected to the circular economy. Climate impact consequences are broadened due to the interconnections of the water-food-energy nexus. The US ranks first among countries experiencing steep economic decline due to water risk, followed by China, Australia, and the UK. US$5.6 trillionGDP loss between 2022 and 2050 related to floods, droughts, and other water-related natural disasters in seven countries with diverse climate patterns. Source: GHD |
Not enough commitment is made by the global community. Only 81 out of 300,000 water utilities worldwide have independent plans for a carbon neutral target. Many water utilities contribute to city-level pledges instead. There are a handful of water utilities making impressive progress, while most are setting carbon neutral goals for 2050. 1.9%of water and wastewater utilities worldwide have committed to the net-zero emission target. Source: Global Water Intelligence, 2022 |
Signals: what we are seeing
Having a prioritized and optimized sustainability plan is a top priority for water utilities
Early Warning Systems
Early Warning Systems provide alerts and notifications of events in real-time or beforehand
30% reduction in damage costs with just 24 hours’ warning of extreme weather conditions (WMO, 2022).
Early warning systems can minimize the impact of contaminated drinking water, flood control, sewage overflow, safe water reuse in water utilities.
ESG reporting requires water utilities to identify and measure water-related impacts and specific action plans to address risks and improve water stewardship. Comprehensive, industry-specific ESG disclosure frameworks continues to evolve (Blockhead, 2021).
Community Engagement Systems
Community Engagement Systems raise public awareness and overcome barriers for water reuse
A 2%-25% reduction in water use can be achieved by effective community engagement via a range of methods to support public awareness campaigns (Australian Government, 2016).
Data platforms and web/mobile applications have been used to collect, share, and visualize the water ecosystem among various water stakeholders and communities. These provide data transparency and build trust with customers and stakeholders.
Drivers: why you should care
Environmental, social, and governance (ESG) programs build a sustainable future. Water utilities need to use ESG as one of their key business drivers, largely driven by policymakers and regulators.
Water utilities must provide reliable essential service, despite the stress placed on water systems. Water utilities must transform and expand their water infrastructure to meet customer demands.
Water utilities are required to provide equitable services to all customers. Managing different needs of residential and industrial customers is key to addressing growing customer expectations.
Value Creation Pillars for Utilities:
- HSE & ESG
- Operational Excellence
- Customer Experience
- People & Culture
- Business Growth
- Risk & Resilience
- Stakeholder & Regulator
Opportunities & Challenges
Opportunities
Business Partnership
Water utilities can engage business leaders to develop community-centric digital platforms to monitor, measure, and track sustainability goals. Achieving the net-zero target requires coordinated effort from the community, not just water utilities.
Process Optimization
Process optimization and data modeling are typically required to support measurable sustainability goals. Improvement of fragmented business processes can benefit the organization in the long term.
Data Marketplace
Open data standards can foster data-driven decision-making culture among broader communities. Standardization can accelerate the integration of various data sources into the data marketplace.
Challenges
Achievable Measurements
Business and technology leaders should collaborate on key performance metrics and plan viable pathways for their organizations. There are risks for organizations making commitments that can’t be monitored, tracked, and achieved.
Change Management
Process optimization impacts business and often requires significant change management effort. It also introduces technology changes for which service providers should prepare.
Data Integration
Technology service providers must develop secured and scalable data analytics platforms to enable not only internal data integration but also data sharing with external communities.
Case Study – WebGIS improves water reuse
- Industry: Wastewater treatment in Milan
- Source: “WebGIS Platform,” Digital Water City, 2022
Peschiera Borromeo Wastewater Treatment Plant (WWTP)
Providing wastewater treatment services to 566,000 population in the Lombardy region of Milan, Italy
ChallengeWebGIS Acque di Lombardia is a web geographic information system (GIS) tool used by all members of Water Alliance Acque di Lombardia and external stakeholders for data discovery and sharing. The current version of the platform had limited access to members, was not interactive, and was difficult to use. The platform did not provide information about water reuse or water quantity or quality needed to support irrigation. Current data was only available on its specific GIS layer, not integrated to support decision making. |
SolutionsStakeholders of this shared platform engaged water reuse communities to understand the overall value chain of water reuse at the regional level. Information was gathered to improve water reuse decision making in the area. Training was offered to the public and farmers on how to use the WebGIS tool to improve decision making related to water reuse. The WebGIS platform was enhanced with real-time integration with the early warning sensors of the Peschiera Borromeo WWTP. |
RecommendationsThe wastewater treatment quality and risk of contamination information within the WebGIS platform provides data transparency and encourages water reuse in the region. The long-term vision of this solution is to integrate with all 40 WWTPs in the Milan area to promote sharing of work methods and water reuse quality standards. Expanding access to the WebGIS platform to the public has increased stakeholder engagement and improved decision making on water reuse allocation. |
Practitioner Insight – Technologies can help achieve net-zero target
The City of Toronto has set an ambitious target of reaching net zero by 2040 with accelerated implementation actions for the next few years. Key areas such as buildings, transportation, and waste are undergoing rapid transformation to reach their targets.
While the organizational aspiration sets the direction, technology leaders and practitioners continue working through tactical initiatives to support business leaders and the overall organization. Arash Farajian, Manager of Smart Water & Technology from the City of Toronto, has spoken to us about the city’s practices.
Sustainability culture permeates everything the city does.
- Each IT project business case must demonstrate how technology deployment is helping or hindering the city’s sustainability plan.
- Environmental impact is analyzed from planning to execution.
- Real-time data analytics gathered from sensors and edge devices help make informed decisions before dispatching field crew and truck rolls to reduce carbon footprints.
- Field technology deployment will often consider leveraging existing infrastructure instead of new construction to reduce disruptions and unnecessary GHG emissions.
“The City of Toronto is committed to reaching its 2040 net-zero target and has implemented tactical steps across the organization. A sustainability plan is required for business case approval of field construction projects as well as technology deployment projects.”
– Arash Farajian, Manager Smart Water & Technology, City of Toronto
What does it mean to you?
Collaborate internally and externally
Collaboration among internal teams and utility peers worldwide to share pathways, actionable insights, and learnings is essential to solve complex challenges.
Assess priorities and build a roadmap
Based on the organization’s commitment, build an equitable and viable pathway with identified priorities and guarantee investments to support technology advancement.
Develop strong foundations
Following a business-aligned digital strategy, technology teams should focus on developing robust and agile foundations including integration.
Info-Tech Resources
Enable Organization-Wide Collaboration by Scaling Agile
Trend 02
Water network transformation
Building a resilient physical and digital infrastructure
Develop resilient water infrastructure to provide reliable essential services
Aging infrastructure puts the water industry at risk. The devastating effects of frequent extreme weather events highlight the urgency of water infrastructure investments. For instance, overflows of sanitary water systems due to major flooding are detrimental to the environment and introduce risks to the health and safety of the communities. 49% Increasein the value of the water infrastructure repair market value worldwide between 2020 and 2026. Source: Absolute Reports, 2020 | Non-revenue water (NRW) is a significant issue worldwide. It not only causes financial loss for water utilities but also contributes to water scarcity. NRW is mostly caused by water leaks, theft, or metering inaccuracies. For instance, about 20% of France’s drinking water is lost due to leaks (Connexion, 2023). 48% Increasein the water pipeline leak detection system market value worldwide between 2021 and 2027. Source: Research and Markets, 2022 | Modernizing physical infrastructure is key to building resilience. Water infrastructure has been persistently underinvested. Significant gaps were identified between what is needed and what was spent over the past two decades and projected into 2039 according to a recent study (US Water Alliance, 2020). $2.2 trillionof cumulative investment gap between 2019 and 2039 in the US. Financial pressure on local and state governments increases while federal funding declines. Source: US Water Alliance, 2020 |
Signals: what we are seeing
Protect physical infrastructure and leverage insights from digital systems
Data-Driven Asset Management
Data-Driven Asset Management leverages a risk-based model to support an asset investment program
Only 5% of public utilities in the United States have a data-driven asset management plan despite the importance and risk of not having one, according to a panel discussion at the 2022 American Water Works Association conference.
When asked about the reliability of field condition data, 65% of survey respondents claimed that 50% or less of asset data collected is objective or accurate, according to a Canadian national report published in 2018.
Sources: Canadian Water Network, 2018; McKinsey & Company, 2021; WaterWorld, 2022
Digital Twin
Digital Twin supports performance optimizations in all aspects of water operations
Water utilities are investing in the foundational capabilities of digital twins such as GIS and data management while exploring use cases in maintenance operation, leak detection, and scenario planning.
Source: BIS Research via Statista, 2020
Drivers: why you should care
Utilities make intelligent decisions based on insights from digital systems to guide their asset maintenance and capital investment plans. This develops resilience in their physical infrastructure.
Utilities are mandated to provide reliable and affordable services to customers despite disruptions and challenges exacerbated by the growing expectations of customers in the digital age.
Operational excellence and efficiency can be gained via data-driven decisions made by leveraging digital systems and protecting physical infrastructure based on risk analysis.
Value Creation Pillars for Utilities:
- HSE & ESG
- Operational Excellence
- Customer Experience
- People & Culture
- Business Growth
- Risk & Resilience
- Stakeholder & Regulator
Case Study – Digital twin simulates reality
- Industry: Publicly owned, privately operated water utility
- Source: MDPI, 2021; IWA Publishing, 2022; Confidence in Digital Twins, SWAN, 2022
VCS Denmark (VandCenter Syd)
Third-largest water and wastewater utility in Denmark, managing about 230,000 residential customers and industry in Odense and Nordfyn
ChallengeVCS has been trying to improve the performance of the urban drainage system using modeling and sensor data since 2008. There are gaps between simulations and reality, even with more than three hundred sensors deployed as of 2021. Simulations with a combination of hydraulic, infiltration modeling, asset attributes, and rain and flow data from sensors could not reproduce the actual event. VCS wanted to improve the performance of the models of underground infrastructure in a consistent manner to ensure their quality. | SolutionsVCS decided to invest in a value-creation “living digital twin” that can model and simulate the complexity of ever-changing and interconnected underground infrastructure. VCS took a holistic approach to evaluate the impact of the digital twin across the entire organization and all business functions as well as external authorities. Hydrologic signatures were used to detect model errors via continuous and iterative improvements of the “living digital twin” to increase the robustness of the analysis. | RecommendationsVCS has developed a digital twin ecosystem through design, planning, and operational models. Detailed workflows were developed to support five major features including data sources, models, analysis and updates, data storage, and user interfaces. The diagnostic framework could efficiently identify and mitigate errors. Improving the transparency of the model’s performance built trust with users. Change management activities were carried out to help VCS staff better prepare for the impact of the digital twin in their daily operations and better understand the anticipated value creation. |
Opportunities & Challenges
Opportunities
Upskilled Workforce
The utility workforce should be trained to improve daily operations and assist in decision making through technologies and information from the “digital twin”.
Centralized Control
Shifting from remote local control to centralized control center aided by system integrations can create better situational awareness among operators and field crew.
Advanced Automation
Digital simulation of physical infrastructure can automate processes from design, planning, construction, and operation. Information would be further streamlined to accelerate advanced automation gradually replacing manual effort.
Challenges
Vendor Partnership
Vendor partnership has a long-lasting effect. Without a proactive and strategic plan to manage vendor relationships, water utilities can find themselves struggling with supporting systems and relying heavily on vendor resources.
Cost of Deployment
There are pressures to reduce costs, yet large investments are needed to keep up with the water network infrastructure gap and digital capabilities. Organizations can leverage government funding and industry analysis such as The Economic Benefits of Investing in Water Infrastructure to justify the investment to regulators.
Data Transparency
Advanced functionalities mandate accurate data and keeping transparency of data can build trust with users. It is important to manage users’ expectations of the anticipated outcome based on data quality.
What does it mean to you?
Strategize vendor partnership
A large and long-term investment is often required to develop asset maintenance programs or digital twin systems and your decision about technology vendor partnership has a long-lasting effect.
Get involved upfront
Create opportunities to ride along and work closely with business leaders, engineers, and field crews.
Hyperfocus on data strategy
The success of developing resilient water infrastructure relies heavily on data availability and accuracy.
Info-Tech Resources
Proactively Identify and Mitigate Vendor Risk
Double Your Organization’s Effectiveness With a Digital Twin
Trend 03
Connecting with the edge
Expand digital intelligence
Empower intelligent ecosystem with edge computing
Demand for edge computing has increased to support digital water initiatives. The increase in connected devices and volume of data growth require faster data processing and decision making. Edge computing complements cloud computing in use cases where network latency is a concern or real-time data processing is required. 6.5 billionforecast number of edge-enabled IoT devices worldwide by 2030. (Statista, 2021) | Edge devices create more possibilities than IoT devices. Harnessed with a real operating system (OS) and large storage space, edge devices are designed to intelligently compute and analyze data without the need to transmit to a centralized system. This decentralized design paradigm brings many other benefits such as reducing network latency, emitting less greenhouse gas (GHG), and improving data security. $30-$50 billionforecast worth of global economic value from water quality monitoring IoT by 2030. (McKinsey & Company, 2022) | Leverage fit-for-purpose edge devices for utilities. Together with customer technologies, edge devices deployed throughout a water network will have a profound impact on the future of water utilities and their ecosystems. Due diligence such as cost / benefit analysis can enforce value-driven adoption approaches that can truly benefit organizations. 9.8%return on investment (ROI) from edge computing within energy and utilities expected between 2019 and 2022, which is the highest among all industries. (Institute for Business Value, 2020) |
Signals: what we are seeing
Edge complements to IoT continue to be widely adopted in water utilities
Edge Devices
Edge Devices fulfill the need of storage, processing, and network requirements
More than 200% growth of the global commercial drone market was forecast from 2021 to 2026 (US$58.4 billion). Common use cases of drones for water utilities are inspections, mapping and survey, localization, and detection (MarketsandMarkets via Statista, 2021).
5x growth of enterprise edge AI chips is expected in 2024 compared to 2020.The hardware market, which did not exist in 2017, sees rapid growth in the coming years where AI / machine learning (ML) will take place on edge devices (“Edge Computing,” Statista, 2022).
5G Network
5G Network infrastructure to support the demands of edge computing
US$246 billion contribution to productivity of 5G applications in the areas of smart meter, smart grid, and reduced water leakage worldwide (PwC, 2021).
4.75 benefit-to-cost ratio in the energy and utilities sectors were modeled among use cases of full 5G deployments in Europe (Analysys Mason, 2021).
Drivers: why you should care
Utilities need to expand the security control ecosystem to edge devices to manage the overall risk. Enhancement of existing processes and technology along with training of the workforce are critical to efficiently managing intelligent devices.
Utilities need to redefine their roles to provide value-added customer experiences to meet growing expectations. Powered by intelligent edge technologies, customers expect utilities to have a complete situational awareness of its infrastructure and services.
Utilities can gain operational efficiency by leveraging computational power at the source. With the amount of data devices generate, edge computing can reduce processing wait time, network congestion, and latency.
Value Creation Pillars for Utilities:
- HSE & ESG
- Operational Excellence
- Customer Experience
- People & Culture
- Business Growth
- Risk & Resilience
- Stakeholder & Regulator
Opportunities & Challenges
Opportunities
Business Innovation
The edge ecosystem challenges the status quo and creates new business models utilities can develop in the future. Edge communication networks are growing as some utilities begin to invest.
Operational Efficiency
Adoption of proven edge / IoT devices can improve operational efficiency. Multi-department use cases can maximize the investment. Water utilities could reduce their investment in physical infrastructure expansions. Edge monitors can detect water pollution and act rapidly and autonomously to correct or mitigate issues.
Situational Awareness
Deployment of edge devices enables decentralized analysis and automation while increasing situational awareness through centralized control. Utility customers can also gain better awareness of water accessibility and quality in their environment.
Challenges
Priority Management
Prioritizing the growing demand for business initiatives can be challenging. Having an evaluation framework will advise users on the best technology to meet their needs.
Regulation Alignment
Work within regulatory constraints. For instance, the usage of commercial drones is typically regulated by government rules and guidelines. Regulations are evolving to keep up with emerging technologies and innovations. CASA has outlined the roadmap for the next ten to fifteen years in their strategic regulatory roadmap.
Maturity and Security
Edge computing technology is still developing. Interoperability standards among various suppliers will also need to be addressed. Utilities should follow best practices to secure the edge holistically and proactively.
Case Study – Drones for inspection
- Industry: State-owned, publicly traded water company
- Source: COPTRZ Commercial Drone Experts, 2020
Severn Trent Water
Providing water and wastewater services to 4.6 million residential and commercial customers across the Midlands and Wales
ChallengeSevern Trent Water wanted to improve its operational efficiency in the areas of inspection and surveying as well as improving the health and safety of field staff. Inspections of some areas such as pipe bridges could be dangerous because scaffolding needs to be placed first. This type of inspection is time consuming and costly. Surveying large water reservoirs usually takes several days and is highly manual. | SolutionsSevern Trent Water did its due diligence before deploying commercial drones for its business operations. Severn partnered with consultants for proof-of-concept flights to test out the usability of different drones. They also learned about how other UK utilities use drones. Severn decided to deploy a fleet of drones for various applications, including industrial inspection and surveying. | RecommendationsSevern Trent Water reported about £750,000 savings in their first year using the technology and expected to double savings in the second year. In addition, deploying drones for surveying applications helped reduce the time from several days to just 90 minutes and produced high-quality, detailed 3D maps. The successful use of drones has demonstrated the benefits to water utilities of implementing edge technologies. |
Practitioner Insight – Technologies can help achieve net-zero target
Significant work is involved for water utilities to adopt various edge solutions, including purchasing the hardware and software, training the staff, and maintenance of both hardware and software. A cross-functional skill set is necessary to successfully run operations. Smaller utilities already struggling with staff shortage may be unsure how to begin investigating the viability of some of these proven solutions.
Anything-as-a-Service (XaaS) is a helpful venue for smaller water utilities to explore. Leverage services offered by experienced vendors to get a head start before investing the time and effort to develop core competency in operating edge solutions.
“New skill sets are required in order to deploy edge solutions successfully. It could be as simple as understanding the implications of technically based contracts which are different from engineering focused contracts.”
– Barbara Wilson, Vice President of Technology Programs, Ampcus Inc.
What does it mean to you?
Define roles and responsibilities
Establishing an edge / IoT strategy with a clear responsible, accountable, consulted, informed (RACI) chart defined with the business can accelerate deployment.
Engage throughout the lifecycle
Digital teams should be part of the planning and budgeting process to support the lifecycle of various components of the edge ecosystem.
Establish rationalization framework
Incorporate the management of the edge ecosystem into your existing application rationalization framework (ARF) to align with your business objectives and goals.
Info-Tech Resources
Understand and Apply Internet-of-Things Use Cases to Drive Organizational Success
Trend 04
Dare to innovate
Networks of collaboration to challenge the status quo
Innovation must drive changes
Recent water innovation focuses on desalination, wastewater treatment, and water reuse. The European Commission’s regulatory requirements and guidelines of water reuse for agricultural irrigation become effective in June 2023. It will accelerate the water reuse use cases in Europe and positively influence progress worldwide. (European Commission, n.d.) Global Innovation Challengelaunched by Singapore's national water agency provides funding support, facilities access, and industry experts to co-develop innovative ideas to commercially available solutions. (Water World, 2023) | Unprecedented challenges today are forcing the industry to reform. That includes regulators, product companies, and utilities themselves. The Australian government released a national report in September 2021. A framework and roadmap for urban water sectors were developed following the guidelines. (AITHER, 2020) Industry Water ReformWater UK is calling for changes in current asset-centric regulatory frameworks to support an outcome-based environmental regulation to enable innovation. (Water UK, 2022) | Innovation should not be limited to technologies. Finding alternatives for a better outcome should include all aspects of the way people work and how business operates. Innovative ideas come from many areas. The challenge is to turn ideas into deployment. Five characteristicsdecide if an innovative idea should be adopted according to the Diffusion of Innovation Theory: Relative Advantage, Compatibility, Complexity, Trialability, Observability. (American Public Power Association, 2020) |
Signals: what we are seeing
Innovation will become a top focus for utilities
AI/Machine Learning (ML)
AI/Machine Learning (ML) assists in reason and decision making
About three times the growth in global conversational AI market revenue was forecast from 2021 to 2026 (US$18.4 billion) (“Conversational AI Market,” MarketsandMarkets, 2021).
99.8% accuracy from deep learning in cybersecurity solutions to detect novel malicious threats, compared to the 61.5% average score for the top 10 vendor solutions according to joint academic and industry tests ("Artificial Intelligence," Statista, 2022).
Extended Reality (XR)
Extended Reality (XR) includes all immersive technologies such as AR, VR, MR, and metaverse
More than 900% growth of global market size of augmented reality (AR), virtual reality (VR), and mixed reality (MR) was forecast from 2021 to 2028 (US$252.16 billion). Common use cases for utilities are training and industrial maintenance (The Insight Partners, 2022; “XR,” Statista 2022).
Utilities are not among the leading business sectors globally. Other industries are already investing in the metaverse as of March 2022 (Sortlist, 2022).
Drivers: why you should care
Leveraging value-proven innovative technologies can help utilities improve operational efficiencies. Repeatable manual processes across the organization are good candidates for improvement.
Fostering an innovative culture can empower employees and create a sense of fulfillment and loyalty toward the organization. Innovation can help keep your best talent when utilities are experiencing talent shortages and competing with other industries.
Innovation can foster business growth. An innovative culture can create a growth mindset of adaptability and agility that the future of utilities demands.
Value Creation Pillars for Utilities:
- HSE & ESG
- Operational Excellence
- Customer Experience
- People & Culture
- Business Growth
- Risk & Resilience
- Stakeholder & Regulator
Opportunities & Challenges
Opportunities
Employee Engagement
Embracing innovation allows organizations to engage a tech-savvy workforce to enhance loyalty to the organization. For example, robotic process automation (RPA) tools streamline repeated manual processes and can increase employee engagement.
Investment Partnership
Utilities can take advantage of public-private partnerships (PPP) to accelerate investments in innovation solutions and manage long-term risk. The Australian government’s National PPP Policy has provided a consistent framework to guide organizations for more than 20 years.
Customer Service
Innovative solutions can be leveraged to gain customer insights and improve customer experience. For example, leveraging AI-powered chatbots can provide more personalized real-time services.
Challenges
Enterprise Governance
Lack of governance over security, and auditability requirements are the number one challenge to companies worldwide who have deployed machine learning from 2018 to 2021 (Algorithmia, 2020).
Funding Model
Public utilities are struggling with financial investment for proof-of-concept projects that might not be capitalized. Without funding to support development, desired business outcomes will not be achieved.
Resource Availability
Lack of skilled staff and dedicated time to cultivate innovation can be a major roadblock. As a result, business and IT can be deprived of the ability to make impactful differences.
Case Study – AR-assisting field operations
- Industry: Municipal water utility
- Source: IT Business, 2018 Canada Construction Connect, 2021
Toronto Water (part of the City of Toronto)
Providing water and wastewater services to 3.6 million residential and commercial customers in Toronto and portions of York and Peel
ChallengeToronto Water has been managing its extensive underground network of pipes the same way for many years. To meet the growing demand for urbanization and customer expectations, Toronto Water decided to challenge its status quo and invest in technology to improve its operational efficiency with the existing workforce. | SolutionsToronto Water has begun experimenting with various technologies such as drones and AR since 2018 for its field operations. An AR app was deployed to field crews to see the underground infrastructure in 3D through a smartphone or tablet. The solution vGIS was developed on Esri’s ArcGIS platform, a joint effort between city engineers and a local software development company. | RecommendationsToronto Water has leveraged AR to add additional 3D layers on its existing GIS solution. The solution allows a field crew to easily visualize underground infrastructure. It provides detailed GIS information about various layers of underground infrastructure to avoid costly water pipe damages. Field crews can take photos and videos of any construction site. vGIS can geo-reference location-based pictures or recordings with building information modeling (BIM) data for future construction analysis. |
What does it mean to you?
Embrace diversity, equity, and inclusion (DEI)
Innovation is fueled by new ideas from diverse perspectives. People are center of creativity, and DEI is the foundation of promoting innovation.
Build an innovation program
Leverage industry guidelines as a starting point to formally structure your innovation program instead of putting it on the back burner.
Develop key skill sets
Based on the needs of global companies, enhancing skill sets in web development, DevSecOps, and AI/ML/deep learning will prepare you for the future.
Info-Tech Resources
Kick-Start IT-Led Business Innovation
Sustain and Grow the Maturity of Innovation in Your Enterprise
Contributing Experts
Arash Farajian
Manager of Smart water & Technology
Toronto Water
Aron Calfas
Head of Digital Risk and Assurance
Sydney Water
Barbara Wilson
Vice President of Technology Programs
Ampcus Inc.
Lee Haller
Chief Information & Performance Officer
Pittsburgh Water and Sewer Authority
Russell Hammersmith
IT Senior Analyst
Monterey One Water
Virginia Roberts
Director, Enterprise IT
Denver Water
Brian Jackson
Principal Research Director
Info-Tech research group
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Unlock Sample ResearchContributors
- Aron Calfas, Head of Digital Risk and Assurance, Sydney Water
- Barbara Wilson, Vice President of Technology Programs, AMPCUS Inc.
- Lee Haller, Chief Information & Performance Officer, Pittsburgh Water and Sewer Authority
- Russell Hammersmith, IT Senior Analyst, Monterey One Water
- Virginia Roberts, CIO/Director, Enterprise IT, Denver Water