Energy companies often work in remote locations, making edge computing a vital solution.

Nov 21 2019

Edge Computing Is on the Rise Among Energy and Utility Companies

Rapid data processing is possible on the edge, a major draw for an industry with widely distributed operations in far-flung locations.

Edge computing, in which data is processed locally near the site of an information-generating device instead of being sent to the cloud or an on-premises data center, is quickly becoming standard in many industries. By 2021, 75 percent of enterprise-generated data will be processed at the edge, up from less than 10 percent in 2018.

Because edge computing saves processing time and reduces the need for internet access, it is often a good fit for utilities and energy companies, which typically have IT assets distributed across wide geographical areas — many times in widely dispersed, inhospitable locales.

As such, it’s gaining wide adoption in the industry. Here’s how utilities are deploying edge computing technology today and how it will likely affect the industry in the coming years.

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What Is Edge Computing?

Gartner defines edge computing simply as “solutions that facilitate data processing at or near the source of data generation.” In an Internet of Things deployment, for instance, the sources of data generation are the “things” with sensors or embedded devices; edge computing allows data to be processed near the physical location of those sensors and devices, serving as a decentralized extension of campus networks, cellular networks, data center networks or the cloud.

“Organizations that have embarked on a digital business journey have realized that a more decentralized approach is required to address digital business infrastructure requirements,” notes Santhosh Rao, senior research director at Gartner. “As the volume and velocity of data increases, so too does the inefficiency of streaming all this information to a cloud or data center for processing.”

Public sector organizations and utilities, along with global energy companies, are top verticals for edge computing, with these sectors combined accounting for 20 percent of total edge use cases, according to the consulting firm McKinsey.

McKinsey identifies the following use cases of edge computing in energy and utilities, among others:

  • Real-time tracking of worksite safety conditions in mines and at oil rigs
  • Activity monitoring to increase human productivity in mines and at oil rigs
  • Tracking the condition of equipment to improve maintenance
  • Data use to improve research and development
  • Smart meters to prevent theft and reduce expenditures associated with utility meter reading

It notes that hyperconverged edge appliances are a good fit for use cases including water quality monitoring, health and safety monitoring in mining, and data collection and processing at offshore drilling rigs.

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What's Next for Edge Computing in the Energy Industry?

Major vendors offering edge computing solutions include Hewlett Packard Enterprise, whose Edgeline Converged Edge solutions speed the deployment and simplify the management of edge applications, and Dell EMC, whose CEO Michael Dell recently promised “a massive build-out in edge computing.”

“You have autonomous factories, all kinds of moving vehicles, transportation, delivery services, intelligent hospitals and buildings. And the demands of performance, latency, costs, security and compliance are all going to require orders of magnitude of more data and processing power at the edge than in all of the clouds combined,” Dell told attendees during theDell Technologies Summit last week.

As for the energy and utility industry, organizations will need to take care to implement adequate security protections as use cases grow. “Extending your footprint using edge computing exponentially increases the surface area for attacks,” says Rao. “A nascent vendor landscape compounds this risk. Unsecure endpoints are already used in distributed denial-of-service attacks or as entry points to core networks.”

However, these concerns shouldn’t necessarily slow down adoption of edge computing. According to McKinsey, the edge will soon be “everywhere.”

“Very soon edge computers will be all around us performing distributed computing across a multitude of devices in homes and factories, on farms, and throughout public infrastructure,” McKinsey notes. “The forces fueling the demand for these devices and the technologies enabling them are advancing rapidly. … The changes that result will affect all players in the tech stack, consumers in a vast array of sectors, and any companies and leaders looking to have a role in it.”


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