In this week's Industrial Talk Podcast we're talking to Michael Bates, General Manager, Energy with Intel, Corporation and Phillip Carey, Energy Consulting Expert about "The Electric Utility Digital Transformation Journey". Get the answers to your "Utility Digital Transformation" questions along with Michael and Phillip's unique insight on the “How” on this Industrial Talk interview!
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Welcome to the industrial talk podcast with Scott MacKenzie. Scott is a passionate industry professional dedicated to transferring cutting edge industry focused innovations and trends while highlighting the men and women who keep the world moving. So put on your hard hat,
grab your work boots,
and let's get All right.
Welcome to the industrial talk podcast absolute, again, honor that you have joined this podcast, this platform that celebrates industry heroes such as yourself, it is a no legacy thinking zone, do not even come to me and say I've got some legacy thinking. Because everybody within industry is bold, brave, daring, greatly innovative, solving problems, and changing lives and changing the world as we speak. Thank you very much for what you do. You're making my life better. And that's really very special. All right, we've got to on this particular podcast, we have a gentleman by the name of Michael Bates, General Manager, energy at Intel Corporation, mad skills. We have another gentleman by the name of Philip Carey, he's a consultant has his own consulting firm, had many, many years within Southern California Edison, and we're talking about the utility digital transformation. It's an important topic, and it must be discussed, let's get cracking. All right, we have a it's a bit long, because they have a lot to say, it's an important topic, a couple of things that you can do. One, you can listen to part of it, come back, listen to it again, because it's important. And two, or two or both, that doesn't really matter with me. You can go out to industrial talk.com, use the player, speed it up, boom, you're good to go. But these two individuals are absolutely exceptional, sees what has to take place within the utility space. And it is really for me being an industrial guy. And being a utility guy. I really geeked out on it, because it was exceptionally a great conversation. So I hope you enjoy it. All right, let's take care of some business real quick. I want you to get your calendar out. And this is the IoT solutions World Congress in conjunction with the industrial internet Consortium. This is an event taking place October 5 through the seventh 2021 in there talking about IoT AI, edge. You name it digital twin. I like this one quantum computing. How about that there is no stopping the future. It's absolutely spectacular. All right, put it down October 5 through the seventh, it's in beautiful downtown Barcelona, Spain, let's get our lives back in gear. That's what I want. I want I want ever this next normal to include travel. That's what I like. And boy, the people of Spain, this organization IoT solutions, World Congress organization, as well as the industrial internet consortium put on a fabulous, fabulous show. Been there a couple of times, broadcasted live from there, enjoyed every minute of it. Next one, put it on your calendar. This is in Cleveland, Ohio, Cleveland, Ohio, this is November 9 through the 11th. It's the manufacturing and technology show. And if you've never been to Cleveland, put that on your bucket list because it is a beautiful place with great people. And this event will not disappoint whatsoever. That's the manufacturing and technology show November 9, through the 11th. Put that on your calendar. A must attend event Oh, I will be broadcasting from there too. And connecting with all of the incredible individuals that are just innovative, that are bold, are brave. They're daring greatly. And you know what they don't do? They don't have any legacy thinking, boom, love it. Alright, let's get on with the interview. So this one of the the topics in one of the things that I was always sort of wrestling with, specifically to the utility space, is the fact that how does utility given all of this the renewable stuff that's taking place with all of the real innovative stuff that's being put onto the grid? How do they manage and how will they manage going forward, and it is a digital transformation, compensation and digital transformation solution. And these two individuals, Michael Bates, and Philip carry, bring the dog gun insights and wisdom. So enjoy the conversation. Welcome, and I appreciate you guys wanted to talk a little bit about the electric utility digital transformation journey, and it's a journey. Welcome, guys. How you guys doing?
Doing well? Thank you.
got it. You know, you got to do it. Nobody knows you. So you got to just say Hey, Mike, give us a little background on who you are because they haven't gotten out to your LinkedIn stat card right
now. Okay, well, I haven't seen it either. But I'm glad to know that it looks good. And thanks for letting me go first. You bet us and thanks for inviting me enjoying conversation today. Cool, have a little background with Phil so we can share some of our common experiences. But my role at Intel is to look for opportunities to apply our technology and convene our ecosystem of partners to address big industry challenges in our energy verticals. Our energy in our case includes oil and gas power utilities, the new energy service companies that are getting into the renewable energy services, for example, the EB charging area as well, as well as digital oilfield smart AG, and water. So we look across different areas of energy and where they impacted the grid is there
like that smart AG, I had an opportunity to, I can't remember it was in Oklahoma someplace. And the the innovation that's being applied to AG, it's impressive. I just think it's cool. Everything's cool.
Let's talk about it. If you want, there's a couple of interesting projects going on in here. We might have
to just sort of dovetail and just go off on a tangent, Phil. Thank you.
Yeah, so my my backgrounds a little different. I was formerly at Southern California Edison for 22 years, in it the entire time, but started out in IT operations. And then at one point, found myself in a architecture group, and then transferred into a group called it smart grid engineering, where we were an IT group that was embedded with the OT group in transmission and distribution, the advanced technologies group. That's where I learned a whole lot about the business. And while I was there, develop this common substation platform. And I retired at the end of 2019. And now I'm off on my own as a consultant. And I've done some work with Intel and with Dell Technologies. And here I am.
It's funny. I think the internet says when you retire, you become a consultant. I think so. There's nothing else you can do it. It says,
Why the internet and my wife keeps saying I thought you were tired? Well,
you don't want to get out of game now. Just kidding.
No, you're right. You're right on the money on that one there. Because this time is very, very exciting. Very interesting. And I don't have the answers. But people like you, Mike and Phil, are in the game. And you're you're talking about this. And so we're focusing in on utilities. And typically, utilities tend to be sort of legacy thinking, this is why we're here, this is the end and it hasn't really changed for a long time, whatever that long time. might give us a little sort of, no, no, no, I'm gonna take it to Phil, because he was with Southern California Edison, not to say that you're not that important or my, you'll get your guide, okay. It's just sort of give us a little sort of that utility thinking, not today, but in the past sort of that utility thought process.
So the, you know, the current utility networks were designed, you know, we're using 100 year old technology, essentially, it was designed to generate electricity, and to deliver it to customers. And the utilities job was to get that electricity in one direction from the generator to the customer, and to balance load with generation. And as long as load and generation stayed balance, and electricity was flowing through the system, everybody was happy.
Such a simple explanation, but it's like when I come into a room and I flip that switch me consumer or me, manufacturer or me, whatever that power be, but better to be delivered at the right cycles, rival to all of the stuff it has to write. And and that's the way utilities have been developed. It's just that's how that's what it is. And rightly so. But what's changing Mike?
Well, one thing is changing is, you know, the model is changing. And, you know, to Phil's point that utilities, the past and still current were built around reliability, keep the lights on so the talent They acquired the training they gave the policy and regulation to support that model, it's all been ingrained for, like you said, since the really much the inception of electric delivery, one way flow of power from centralized generation coal plants, nuclear plants, then through step down to consumption at the far edge, that's been the model and the bill, then the technology has been in place to support that model of keep the lights on at all costs. And I think Phil might agreed he's much more into the technology side than I am, but it feels like a siloed stack of solutions have been built around this grid reliability model. And now, the grid, the delivery model is really turning upside down. It's not it's changing from that one might flow from Central generation to to a flow from hundreds and 1000s of millions of points of generation on the opposite side of the grid, the other side of the substation, so it wasn't built to take on that two way flow equipment, maintenance costs go up because equipment wasn't designed for it, there's lost opportunity cost, because you're not connecting these new loads in a way under the kind of common substation platform to fill required. So it's a major shift of focus from the the generation side, down to the consumer side, consumer own asset side. And now you're asking a company that's been built to keep the lights on to now become a customer focused company. Look, you know, if the opportunity in the future is around services, you got to remake and re engineer a company to make that pivot. And it's hard for some companies to make that pivot, especially in the utility space.
Yeah, and, and you know, an example of that. And it's not this, not the utility industry, but IBM used to be the biggest hardware manufacturer in the world. And today, there are software and services company, they hardly make any hardware. So this is where the utilities need to go. And they need to look at how their business model is changing. And accommodate that.
Yeah, if you don't mind, God, I was just gonna add to that, I think the other thing I've heard the other comparison, I've heard Phil, and I think all of us on the call around to remember the telecommunications restructuring where the companies like the southwest and Bill's of the world who built all that infrastructure to enable what we see today, were not the companies that really profited from it, it was Facebook, Google, Amazon, they use all that infrastructure that was built and created services around it. And the infrastructure providers haven't even caught up since then, I think that's one of the inflection points we're at today is who's going to own that piece going forward.
So in a sort of simplified in my head, is that utilities were built in a way where I generate power, I transmit that power, I stick it into a distribution substation, and I just keep on bringing it down, bringing it down to the consumer level today, and that's fine. That's right, I see that flow. But today is like, okay, we have some that flow that go that way, right. But then on the other side of that, that transformer or that bus is is also generation that's happening on that side. So what so now we're saying it's got to flow the other way, and it's got to flow into this magical system. And it's not supposed to suppose just happen. It's like everything just sort of lines up. But that's not the case. That's not the case at all. So So there's a couple of things that I see taking place. First off, and I think it was you, Mike? Yeah, it was probably you. The toothpaste is out of the tooth, the toothpaste is out of the tube, it's out. So so we're heading down this road, it's happening, whether we like it or not, it's happening. So as a utility, let's say I have my utility hat on, I've got to do something about it. What problems is this new sort of dynamic grid had a causing on my system, Phil.
So one of the large problems is load doesn't necessarily match the generation system specifically out on some of the feeder circuits. So to combat this utility, really needs the capability to be able to reconfigure the feeder circuits to better match the load. Another issue is in the past, if I had a fault on one of those distribution circuits, I could tell by measuring the power flow through the relay And when it got out of specification, I knew there was something wrong, the system knew there's something wrong. And that relay would send a trip signal to the to the circuit breaker. Well, now that I have generation on both sides of that relay, how do I detect the fault? point? Yeah. So that's where some of this digital controls come in, so that we can measure and, you know, know how to deal with two way flow of energy now.
So here's the funny and here's a, here's a story from my past. So when I was with Southern California Edison, I knew, you know, I'd go into that relay room, I have that smell, and distribution voltage, I can always see, I could always see the lights, right, the lights, they'll, they'll dim. And I'll say, okay, that's what they'll dim. Okay, that's too. And I know that the, the testing the relays physically test the line. So if it, if there's a there's an, an interruption, they'll Test, test, test, and then lockout three times that was like the, the policy at a time, right. And my dad, as a former lineman, when he would watch the lights. And as a kid, I'm going to hex you're probably right, and you'll see it one, and it'll count two, and then he has three. And then right off the bat, he get a call. But but that that's old time thinking that's that's old way now with like you just said, Phil, you've got generation on both sides. How does that that physical, a really know what's going on? Mike? What other problems are utilities dealing with? In this particular? Whatever we call it? I don't even know. Is there a term that we can call this particular world that we live in from utilities perspective?
The general term, I've heard his energy transition, but that that includes a lot of different things. But that's the term I'm just gonna run with that...