The utility industry is unprepared for the imminent digitized, decarbonized future, with the sector falling behind as demand for clean energy and electrification requires a workforce and enterprise beyond their current capabilities, according to the EY Power & Utilities Digital Transformation and the Workforce Survey.
159 power and utilities executives, with responsibilities across multiple sub-sectors, including electric, gas, water, and renewables, were asked about how their companies will be adapting to changing consumer expectations for a cleaner energy economy, and how they are planning to invest at least a moderate amount in technology. For both topics, the respondents were also asked if they felt that their workforce was capable of adapting to these changes.
While more than 90% of respondents shared that they will be changing their mix of energy sources over the next several years and see investing in technology and their workforce as a pressing need, these goals both come with unique and difficult-to-address challenges. Most paramount, 52% of respondents shared that the speed at which their organization can move is a major challenge to digital technology adoption, with 40% also citing funding as a major challenge.
A potentially more troublesome 89% of respondents report having too few workers with the right skills to make digital technology adoption viable.
Without funding support and a w0rkforce capable of meeting the challenge, these utilities will have major issues meeting the climate and technology goals being established for the near future. The report highlights the specific hardships that will make it difficult to achieve the European Commission’s goal of at least 30 million zero-emission cars and 80,000 zero-emission trucks to be in operation by 2030.
In recognition of the challenges facing these utilities, EY has developed three strategies to best deliver differentiation, excellence in customer and employee experience, and cost optimization in an evolving energy landscape:
- Don’t just “do” digital — “be” digital
- Pace, plan and prioritize to close the skills gap
- Align on strategies and eliminate challenges in the face of new threats
The report likens the difference between “doing” digital operations and becoming a digital-thriving entity to buying a race car: it’s nice to have a fast car, but knowing how to drive it is equally important. Likewise, utilities must make sure the capabilities and functions of the digital technology they are investing in align with their strategic vision in order to sustain or improve that company’s competitive position in the market.
As for the skills gap, the most universal concern among respondents, the report outlines that closing the gap begins with identifying and prioritizing what skills each business needs to achieve expressed goals and further investments. Planning and implementation must be done at pace across the organization, focusing on cost optimization strengthening workplace culture. The digital revolution will make utilities tech companies as much as they are service providers.
Finally, in order for the two above strategies to work, utilities need to understand that any change made is not singular, and that the effects can influence the entire company. This is why keeping the workforce up-to-date on unified goals and strategies is so important. Being dynamic in challenge identification and the strategies used to overcome obstacles will be critical as technology speeds innovation.
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