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Neill_58630 May 14

MITIGATING RISK IN TIMES OF TRANSITION – OPERATIONAL RISK MANAGEMENT IN THE WAKE OF THE PANDEMIC

MITIGATING RISK IN TIMES OF TRANSITION – OPERATIONAL RISK MANAGEMENT IN THE WAKE OF THE PANDEMIC image
A digital closed-door session endorsed by the Association of Power Utilities of Africa (APUA) which took place on 13th May 2021, catered specifically to the Heads of Utilities in Africa. The meeting featured a closed-door working group of CEOs and CFOs seeking answers to some of the pressing challenges resulting from the pandemic.
Africa’s utilities transition has been given an injection of pace and urgency following a year in which the need for efficiency, visibility, flexibility and innovation has been highlighted.

A host of projects – particularly around renewables – were hit hard as their often-international operations were impacted by COVID-19. Many EPC teams had to return to their home countries, and procured equipment from overseas manufacturers struggled to get through. 

And yet, while COVID has undoubtedly had a challenging impact on countries, economies and the power sector, it has also encouraged a sense of introspection around how the future utilities makeup – and sector as a whole - can become more sustainable, intuitive and dynamic.

The energy transition, to this end, is about more than just the move to cleaner fuels. Moreover, the past year has highlighted notions of digitisation, more agile project planning, the power of the cloud to facilitate smoother collaboration, and ultimate consumer flexibility – pillars and benefits that many utilities on the continent are now striving towards.

The significance of digital tools has been brought to the forefront of all phases of the power lifecycle since COVID’s arrival. Through this forced change, there has been a realisation that projects themselves can be discussed, initiated and developed without face-to-face meetings. The use of video technology tools has brought renewable projects through concessionary stages, to the point of feasibility studies, via this remote method. 

However, what this opportunity has also exposed in some cases is the need for more sustainable and reliable data – both in a connectivity, and analytical, sense. Addressing more than just reliable video streams; from a project standpoint, to quantitatively monitor project progress, maintenance, procurement, logistics and performance - centrally and from one single source of truth - is a game-changer.

Additionally, as part of a longer-term snowball effect, the more data that is collated, the more insight organisations can leverage to inform future investments and required improvements. 

Most significantly, the main beneficiaries of this improved digitisation, will be the utilities companies themselves by achieving more operational sustainability; and certainly, the customers, who will be opened up to the prospect of better value for money, and flexibility around how they part with that money.

For many end consumers across the continent, the pandemic has meant more power consumption during lockdown, potentially less income, and certainly less flexibility about how to pay their bills given face-to-face restrictions.
From a distribution and payment perspective, this has accelerated the likely implementation of smart metering, which will ensure more accurate billing and better value for money; while smart payments provide more agility to ensure smoother cash flows. 

This change of mentality among the utilities fraternity is perhaps where the main transition lies, looking forward. Amid decentralisation plans and off-grid projects that form a large part of the general power transition and universal access plans, utilities players now have a prime opportunity to improve the electrical network, internal processes, the customer proposition, and final cash flows; all through one digitisation strategy. The COVID cloud has showcased the resilience and innovation that exists in Africa, and perhaps encouraged a longer-term silver lining in the form of a digitally-driven utilities transition.