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Can ICT help keep the lights on in Africa?

April 8, 2014 • Opinion, Top Stories

Right now, the energy industry in sub-Saharan Africa is at a crossroads. Faced with booming demand from a growing industrial sector, urbanisation and an impatient consumer base, the region’s energy utilities must deal with a unique set of challenges that can ultimately drive away both local and foreign investment and affect entire economies if they are not overcome.

According to SAP, the energy industry in sub-Saharan Africa is at a crossroads. (image: file)

According to SAP, the energy industry in sub-Saharan Africa is at a crossroads. (image: file)

We’re all too familiar with some of these challenges: ageing infrastructure that breaks down at inconvenient times; the need to optimise assets; the problem of meeting the demands of increasing urbanisation and business growth, while dealing with growing environmental considerations. Nobody said it was easy.

But by using modern ICT tools smartly, energy utilities could be keeping the lights on more effectively by having insight into critical areas like asset performance, consumption patterns, predictive maintenance, load forecasting and any anomalies.

Fact is, Africa’s utility companies can no longer afford to rely on outdated ICT infrastructures. The stakes are simply too high. The energy and natural resources sectors are the backbone of Africa’s economy and are vital to the current and future growth and well-being of many countries. New oil and gas discoveries in Africa are opening new opportunities for growth, and mining continues to be a key revenue generator in many African countries.

One of the keys to success for any utility in the world today is effective data management. Utilities need to not only gather large amounts of information, but critically, understand that information and turn it into insights that can be acted upon.

By doing this, they can diagnose and even predict issues before they happen, leading to increased asset effectiveness, the prevention and real-time handling of unplanned downtime, better daily forecasting and even the ability to predict demand. And all this can be done from a mobile device whilst sitting at an airport.

Having reliable data that is collected effectively can provide huge competitive advantage. It allows energy companies to operate efficiently and see where and when energy discrepancies occur. This ultimately leads to reduced costs once the system is in place.

A simple example is meter readings, which can become much easier to collect and to analyse for usable insights into how energy is being used for individual consumers, in specific regions or even to detect fraud. With insights like these, utilities are better equipped to handle their customer needs, respond to those needs and better match supply and demand.

Another major challenge facing our utilities right now is that they don’t have the right levels of supply chain visibility. In other words, they lack the ability to know what is happening in all aspects of their organization and thus are not able to predict problems and quickly respond to the changing needs and challenges on the ground.

With an adaptive supply chain, utilities can intelligently adapt to changing market conditions and synchronise supply to demand by having distribution, transportation, and logistics processes integrated with their real-time planning processes. The result: energy procurement costs decrease and improved grid operations mean that maintenance costs are reduced.

And once utilities are running what they have more efficiently, they are then able to look at more innovative platforms to differentiate themselves and create new revenue streams, interact in new ways with stakeholders, adapt more quickly to the changing business environment and improve productivity, transparency and decision-making.

Energy companies in Africa cannot afford to be left behind. They don’t have much time, though, which is why the emergence of cloud-based data and analytics solutions could emerge as the unlikely hero of energy crises across the continent. On the flip side, there really is a bright future for those that invest in the right data management infrastructure. Utilities that are functioning at the top of their game will naturally attract investors and ensure their place at the forefront of the African energy market for decades to come.

Ashley Boag, Head: Energy and Natural Resources at SAP Africa

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