Coping with changing market structures

by Stephen Magee

Flexibility – it’s a simple concept, but it’s not so easy to achieve in practice. In the energy market, where companies need to exchange data with each other continually, and regulations and standards can change frequently and at any time, flexible integration is a key enabler for efficient, cost-effective operations.

In too many cases, however, ‘flexible’ integration solutions aren’t nearly as flexible as they first appear. Changes in messaging formats can often require coding changes, recompilation, redeployment and downtime for the integration platform, or even for the back-end systems connected to it – leading to spiralling development costs and long lead-times for changes.

With the introduction of new legislation, the increasing drive for sustainable energy and – in particular – the rollout of smart metering, the industry is entering a period of unprecedented change, both in the UK and in other markets. Changes to the structure of the industry will almost inevitably lead to changes in the integration landscape.

For example, instead of interacting with agents who provide periodic manual meter readings, suppliers will soon have the ability to collect data directly from smart meters on a 15- or 30-minute cycle.

The deployment of smart meters will create an entirely new kind of data-flow that needs to be captured and managed. Aside from the challenges related to data volumes – which are significant! – reading and processing the new smart meter messaging formats will require considerable changes to the integration layer.

So, if it’s a given that integration is a moving target, what is the alternative to constant, costly development projects? One option is to create a comprehensive catalogue of message format definitions and embed it into an industry-specific data-flow management environment.

This makes it much easier to manage change at the integration level. If any of the message definitions need to be adjusted, the catalogue can be updated with a few mouse-clicks, and the new data-flow rules will cascade through to all the relevant systems automatically, without the need for any downtime.

By building flexibility into the solution itself, this approach not only saves on development costs, but also dramatically shortens the development process – which allows more time for testing and reduces the risk of defects. Furthermore, it almost eliminates the need to make changes to back-end systems, because it can seamlessly translate new or updated message formats into whatever legacy format the back-end requires.

For utilities providers that operate in complex markets where change is the only constant, this kind of built-in flexibility can make a lot of sense. As levels of complexity and rates of change continue to increase in almost every developed energy market, utilities may want to consider whether their systems are truly built to cope with change.

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