Wednesday, April 24, 2013

SmartOperations is the Future

Last week at CWEA Annual Conference, I had some very interesting conversations with leaders of our industry about the future. Here is a gist of my perceptions that I shared liberally with everyone.

The Future of the Water Industry, at least for the next two decades, will be all about Smart Operations. Over the last hundred years, Engineering was leading the show. This was because we needed to invent processes and technologies that can clean water from rivers, lakes, and oceans to make them palatable and safe for human consumption. Once that water has been through the 'human system', we also worked on technologies that will clean the water to a sufficient level safe for reintroduction into nature. We are there; we have figured out the basic engineering technologies that can effectively produce clean water. Yes, there are still some frontiers to conquer, such as trace organics and pharmaceuticals, but engineering on those frontiers will unlikely yield a 'breakthrough' and will most likely have diminishing returns. I am not advocating that engineers and scientists should not spend time on those peripheral problems, it is just that the industry will shift towards effective implementation of what is already there. Operations will take primacy over Engineering.

This is a major shift for the industry, you can compare it to the way water bodies turnover during change of seasons. All major institutions in the water world is currently dominated by engineers, be it the EPA, the major trade associations like AWWA,WEF, WateReuse, the regulatory agencies, the agency leadership, etc. Engineering consulting firms also dominate the direction that the industry takes. But this is changing and this transformation will get faster by the day. Engineering consulting firms are already facing the choice of just becoming Planning firms or to become Design-Build focused companies. Planning firms will develop program level plans and when needed work on 30% design of facilities. Treatment plants of the future will be more equipment driven and packaged than custom designed (as they are now). Design-Build firms will be led by construction managers and engineers will assist them to take those 30% designs to fruition. For engineers, the choice is to quickly adapt to this new model or perish.

Smart Operations will mean redesigning the water and wastewater agencies as businesses and focus on continuous optimization. Most water agencies currently react to water demand and supply stresses and wastewater agencies believe that they exist to maintain regulatory compliance only. Water agencies of the future will get ahead of the supply-demand race and work to control both the issues. On the supply side, focus will be on reliability investments, water grids will become smart grids just like the electricity grid with infusion of software and sensors, and the demand side will see an increased management effort. Wastewater agencies will reinvent themselves to be factories with three designer products to sell - clean water, nutrient rich fertilizer, and electricity. The technologies to get there is already available, the only limiting ingredient is the foresight and confidence of the operations managers.

Water SmartOperations
(C) PROTEUS Consulting
To make this happen, PROTEUS Consulting is working on building bridges between the Water sector and other sectors - Energy, Information Technology, Economics/Finance, and Communications. Before the end of this year you will see Energy and Water Sectors forging new paths, where water sector will act as flexible loads to help balance the grid and in turn get to access a new revenue stream independent of water sales. Software will play a very important role in SmartOperations with business intelligence, knowledge management, gamification, text analytics, data mining, learning networks, etc. taking the center stage. PROTEUS expects to usher the growth of software solutions for the water industry and we will also champion the use of open source code to enable the maximum benefit to these publicly owned and operated water and wastewater agencies. Economics within the water agencies and financing of infrastructure projects will change. Water trading networks, real-time value chain operations, infusion of private equity, are a few initiatives PROTEUS is working on. As for communications, gone are the days when the water industry was churning out calendars with 'save water' sketches, you will find art, literature, theater, cinema, games, and mobile apps flowing all around you. Stay tuned!

Thursday, April 18, 2013

Water+Energy Presentation at CWEA Annual Conference 2013, Palm Springs

It was a very good turnout at the CWEA Annual Conference this morning. We talked about the next frontier in Water and Energy Nexus. The reception was very positive. Some people who could not attend my talk caught hold of me in the corridor/hall and wanted to connect and learn about with Proteus' Water+Energy work. I could not have asked for more!

The ideas we present here are new and refreshing. The concept of flexible load on the grid is not in the mainstream, but it will soon become a reality. Discussions are ongoing at the CEC level on how to prepare for the future grid when renewables will change the peak load profile. Water industry stands ready to meet the challenge, to act as a flexible load!

The plan forward is to get pilots going for flexible loads using treatment plants and pipeline networks in all three IOU territories by spring next year. Once the concept is proven, the work will commence on pricing and program development. As the water industry amounts to 20 - 45% of California's total energy use, that is a lot of load that can act as a flexible load on the grid. Welcome to the future!