Benefits of digitized power plants threatened by glacial progress

Benefits of digitized power plants threatened by glacial progress

Benefits of digitized power plants threatened by glacial progress

Consultancy giant Capgemini has revealed the findings of a report into the digitization of power plants.

The study, featuring the views of 200 executives in global utility firms, suggests that continued investment in revamping coal and gas-powered plants will increase production and improve efficiency – but much more still needs to be done.

The Digital Utility Plant: Unlocking value from the digitization of production highlights the impact that digital enhancements are having on energy production in power plants reliant on fossil fuels.

It finds that over the past five years, utility companies have invested an average of $330 million in smart plant technology. Capgemini predicts that a similar level of investment will lead to almost one in five power plants becoming ‘digital plants’ by 2025. The result will be a 27 percent reduction in running costs and a 4.7 percent net reduction in global carbon emissions from power generation.

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Lowering the cost of energy generation

Utility leaders in China, France, Germany, India, Italy, Sweden, UK and the US are seeing an increase in production efficiency as a result of incorporating digital technology in power plants. The report estimates that smart plants see on average a 27 percent reduction in production costs, with individual plants saving $21 million each year on average.

Renewable energy sources are becoming increasingly competitive, and these savings will keep coal and gas-fired plants operational until a complete transition is made. Smarter plants are helping to strike the balance between meeting the rising global demand for electricity and the need to lower carbon emissions.

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More energy, fewer emissions

From an environmental perspective, the Capgemini report offers an optimistic outlook. Digitized power plants can increase the energy produced from fossil fuels while lowering carbon emissions.

Capgemini digitized power plants carbon emissions
By 2025, digital plants will save 625 million metric tons of CO2
emission globally | Capgemini

The impact of digitized plants is so great that by 2025, it’s estimated that they will annually produce 625 million metric tons fewer carbon emissions compared to traditional plants. That’s equivalent to 28.6 billion more trees on the planet or 133 million fewer passenger vehicles.

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A lack of digital maturity

Although there is plenty of potential and progress already being made in the utility sector, the report points out that “their ability to reap the benefits of their ambition raises significant concern. Only a small minority (8 percent) of utilities’ operations is digitally mature.”

Carbon emissions are a pressing concern for climate scientists, but the glacial progress of the energy sector in deploying digital plants threatens to undermine eventual benefits. Just 19 percent of power plants are expected to be digital within five years. The report concludes: “If more utilities were to prioritize digital investments, then the benefits to the industry and climate could be much greater.”

Perry Stoneman, global head of the energy & utilities sector at Capgemini, reiterated that more attention and investment is needed from utility suppliers if digitized plants are to reach their full potential.

“It’s clear that digital is already transforming power generation, enabling utilities to remain competitive and significantly reducing global carbon emissions. However, the industry can go further,” he said.

“With many utilities yet to digitize power plants, it is possible to reduce carbon emissions even more, if these utilities invest in digital skills and technologies. Firms that choose to embrace the digital future of power production now will gain a greater competitive advantage, lower production costs and boost their brand reputation.”


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