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How Municipalities Benefit from Connected Utilities

Business as usual isn’t an option for utility companies. The same is true for municipalities. Urban populations are growing, climate change is a real concern, customer expectations are transforming, and environmental regulations are placing new demands on municipalities and companies, alike.

Technology companies, especially those based on the Internet of Things (IoT), are also reshaping the marketplace. The smart home industry was a 27.4 billion market in 2017 and is expected to grow to 53.45 billion within the next five years. By outfitting their homes with connected devices, homeowners can better track and manage energy usage, and as a result, track their utility expenses.

But it’s not only homeowners that will benefit from a smart home. There are high stakes for municipalities and their utility providers, as well as significant benefits for both parties when leveraging connected utilities.

City lit up at night with connected utilities

The benefits of connected utilities for municipalities

Civic bodies are under increasing pressure to meet new regulations to curb global warming. They are equally compelled to meet a growing demand for utilities as their populations, especially in urban centers, expand to record heights.

By using connected utility solutions, cities can become smarter. Smarter in how they function, using real-time data to monitor, analyze and improve a city’s response to its citizens’ needs. Smart cities that use well-designed tools can eliminate redundancies, streamline responsibilities between departments and find ways to save money.

An eco-friendlier city is another benefit of connected utilities. With sensors and smart devices, municipalities can analyze data to make improvements that will benefit the environment. For example, for areas that experience water shortages, including those in California and Valencia, Spain, among others, IoT capabilities can be used to improve metering, detect leakages, and improve distribution and planning. Leakages, for example, are regularly responsible for the loss of up to 20% of the potable water that a network will lose. By capturing and analyzing data from smart water meters and network monitoring devices, cities and water utilities will be able to more effectively identify leaks and quickly fix them to prevent additional water losses.

Benefits for utility companies

With current and emerging technologies, competitive forces and regulations at play, most utility companies know their businesses will undergo radical change over the next five to 10 years. This change includes a shift in how their companies generate, transmit and distribute energy as well as how they manage their utilities and service their customers.

In one instance of change, a growing number of governments are working to bring smart meters to the majority of households. These devices, along with smart thermostats and other IoT devices in the home will give utility companies access to vast amounts of data that can be used to assess consumer patterns. What’s more, connecting these devices to distributed generation and other connected solutions within the utilities’ infrastructure will enable providers to develop new and innovative services and pricing packages.

For utility companies, bringing IoT into their operations will enable them to more proactively service their customers, building trust, and in turn, customer loyalty. Plus, it will better position them in the market as technology companies and encourage other new entrants to consider how they can disrupt the utility market.

As municipalities and utility companies grow their IoT ecosystem, more attention will need to be paid to managing the multitude of connection points and ensuring security challenges are identified and addressed effectively.

Referenced sources:

Other sources: 

Case Study: IoT is redefining the customer experience. Nokia case study.

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