ORIGINAL REPORTING: Why Utilities’ Move To The Cloud Serves New Energy

Utilities, regulators find common ground in reforms to encourage cloud computing; Traditional utility regulation does not allow companies to rate-base cloud computing services. Some regulators want to change that.

Herman K. Trabish, March 2, 2017 (Utility Dive)

Editor’s note: The only way utilities will support the New Energy transition is if it is in their interests. That is why regulators must re-interpret existing rules or write new rules to make the move to cloud computing work for them.

New technologies are flooding utility databases with system and customer information. To manage it, many companies add servers and software. But utilities are not IT providers, and many are struggling to make sense of all that data on their own. The best answer, many in industry say, is to move the information off utilities’ own computer systems and outsource data management to experts. But utility leaders have been slow to make that move because a regulated rate of return comes only from capital expenditures on servers, not from spending for expertise in the cloud.

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Oracle Utilities’ January 2016 survey of 100 utility executives found 45% were using some form of cloud-based applications or computing resources delivered as services over a network connection, rather than using on-premises infrastructure. That hardly puts the power sector at the cutting edge. According to other surveys, 83% of healthcare companies used cloud-based services 95% of IT professionals are using the cloud. But Illinois Commerce Commission (ICC) Chair Brien Sheahan is leading the only regulatory proceeding in the U.S. examining the value of software as a service (SaaS) and cloud computing to utilities. The proceeding is part of a growing interest among regulators in cloud computing for the power sector… click here for more

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