Data Monetization: Water And Wastewater Utilities In The Information Age
Measuring the value of physical assets can be tricky. Valuation models for companies are arguably more art than science. What about the value of something nebulous such as data? The intrinsic value of data is nil. Data’s extrinsic value is revealed only after processing it.
Once analyzing bits and bytes reveals patterns and anomalies, value creation happens by implementing systems, processes, and incentives that improve decision-making capabilities and performance. Data becomes extremely valuable once it can be leveraged to increase, or at least preserve, the value of assets and the companies that own them. Moreover, data can help make the people who comprise organizations far more productive and effective.
How can water and wastewater utilities monetize data and improve profitability by generating top-line growth and reducing costs? Utilities now face significant and complex challenges: aging infrastructure leading to pipe bursts and significant water loss, service line corrosion leading to lead contamination, disinfection by-products creating chemical hazards, strained sewer capacity leading to overflow events, and water scarcity in drought-stricken regions to name a few. Within utilities’ often sprawling networks of assets exist virtually infinite possible failure points. Waste and inefficiency have countless places to rear their ugly heads. Operators face increasing pressure from regulators, who are imposing more stringent standards. Fortunately, these difficulties are surmountable or at least manageable.
Data centricity is critical
A granular data-driven approach is paramount to effective and sustainable management of infrastructure and resources. Given the sheer number of factors at play and the often complicated interconnections between them, including feedback loops and time delays in cause and effect, common sense and a back-of-the-envelope approach will only take analysts and decision makers so far. Data fusion and analytics software tools capable of processing and correlating large volumes and different types of data can automate or facilitate insight extraction.
Where information is lacking in quality, quantity or is altogether missing, problems and bad decision making occur or persist. Data collection is the first and crucially important step water and wastewater utilities can take in the right direction. With baseline measurements of the state of their networks, operators can: evaluate problems, decide on and implement changes, and collect data continuously to assess results. This becomes an iterative process.
While huge volumes of data are being created in virtually every industry, there is a surprising data gap in the water and wastewater sectors. Utilities oversee sprawling networks of distributed assets. Establishing and maintaining visibility within these networks has proved challenging to date. That need not be the case.
The digital evolution taking shape
In a 2011 essay published in the Wall Street Journal, investor Marc Andreessen wrote, “software is eating the world.” The premise of his thesis is that computers, microprocessors, and the modern Internet have been developed and improved over several decades, and collectively, these technologies now run businesses and industries on software and deliver them in the form of online services. Water and wastewater utilities are now in the early innings of a digital evolution. This evolution also combines new innovations in sensor and communications technologies that is collectively being referred to as the Internet of Things (IoT) or the Industrial Internet of Things (IIoT). Improved data acquisition capabilities will help utilities move more seamlessly into the Information Age. As this industry evolves, cyber threats become more salient.
Ensuring the cyber-security of water and wastewater utility information technology infrastructure is tantamount to ensuring the security of their physical infrastructure, the public, and the environment. SCADA (supervisory control and data acquisition) systems and other ICS (industrial control systems) that leverage data gathered from remote monitoring systems are only as secure as the weakest link in the network.
Measures needed to reduce the attack surface size for infiltration include: using secure communication protocols, encrypting data, and identifying sensor and gateway tampering. Progressive utilities that use sensors to create data collection nodes throughout their network are at an advantage relative to those less sophisticated utilities that collect little or no data at all. But utilities that understand the importance of securing their SCADA systems and ICS are truly forward-thinking.
Utilities can monetize data and realize rapid and outsized returns on investment using turnkey, cyber-secure, cost-effective data acquisition solutions. Water and wastewater utilities that understand this opportunity and capitalize on it will lead their sectors into a more resilient and prosperous future.
Note: this post was adapted from a white paper.