As the effects of climate change become more apparent, the electric power industry is accelerating its efforts to reduce environmental impact. To gain a clearer understanding of their emissions reduction progress and identify areas for improvement, utility companies are turning to artificial intelligence (AI) and data analytics.

IBM has partnered with the American Productivity & Quality Center (APQC) to create the Clean Electrification Maturity Model (CEMM), a benchmarking tool that helps utilities measure the maturity of their clean electrification capabilities. The CEMM provides insights for setting transformation priorities and tracking progress along the way.

Results from the first global CEMM benchmark of 90 transmission and distribution utilities demonstrate the potential role of AI and data analytics in the industry’s transformation. Companies that harness these technologies can increase the viability of clean energy by improving cost competitiveness compared to legacy energy sources.

One key area where AI can make a difference is in energy balancing and trading. Mature utilities prioritize research in this area about 3.3 times more than less mature companies. By incorporating AI into renewable energy generation, transmission, and distribution processes, utilities can gain better insights into weather patterns, leading to more accurate predictions for solar and wind farm output.

AI’s Role in the Energy and Utilities Sector

AI can also enhance customer care by freeing up resources for innovation in other areas. The most mature utilities are more than four times more likely to utilize customer experience platforms, including AI-powered chatbots and data analytics for personalized service. These technologies can also drive efficiency by helping customers reduce their energy consumption during peak demand periods.

Despite the progress made, the industry still has a long way to go in achieving its carbon reduction goals. The most mature 25% of transmission and distribution utilities achieved a modest overall score of 2.2 out of 5 across all domains, according to the CEMM study. The average maturity for all utilities in this sector was at the 1.6 mark, indicating significant room for improvement in technological maturity.

As global electricity demand continues to rise, utility companies must take urgent action to realign their strategies and adopt intelligent, data-driven processes for change. By following the example of industry leaders and implementing proven AI-enabled technologies, utilities can make significant strides in meeting their emissions goals and mitigating the impact of climate change.

Access the full report and insights on the IBM Institute for Business Value.

FAQ

How can AI and data analytics help the electric power industry reduce environmental impact?

By harnessing AI and data analytics, utility companies can gain a clearer picture of their emissions reduction progress and identify opportunities for improvement. These technologies can also help in predicting weather patterns for renewable energy generation, optimizing energy balancing and trading, enhancing customer care, and driving efficiency.

What is the Clean Electrification Maturity Model (CEMM)?

The CEMM is a benchmarking tool developed by IBM and the American Productivity & Quality Center (APQC). It enables utility companies to measure the maturity of their clean electrification capabilities, set transformation priorities, and track their progress over time.

What were the findings of the first global CEMM benchmark?

The benchmark revealed that companies that utilize AI and data analytics have the potential to make clean energy more viable by increasing their cost competitiveness compared to legacy energy sources. It also highlighted the importance of prioritizing research in energy balancing and trading, as well as adopting customer experience platforms powered by AI for personalized service and efficiency.

What is the current state of the industry’s carbon reduction goals?

According to the CEMM study, the most mature 25% of transmission and distribution utilities achieved an overall score of only 2.2 out of 5 across all domains. The average maturity for all utilities in this sector was at the 1.6 mark, indicating significant room for improvement in technological maturity.

How can utility companies contribute to mitigating the impact of climate change?

By realigning their strategies and adopting intelligent, data-driven processes for change, utility companies can make significant strides in meeting their emissions goals. Implementing AI-enabled technologies and learning from industry leaders can help utilities reduce their environmental impact.