With the growing presence of technology and adoption of internet of things (IoT), a number of opportunities are emerging in the city gas distribution (CGD) sector. Today, oil and gas companies are seeking customised solutions for their distinctive business requirements. They are also looking at all possible angles to balance their in-house information technology (IT) requirements by outsourcing them. A notable initiative in this regard has been the investments by CGD companies in enhancing their IT and operational technology (OT) capabilities.
The IT systems present across major CGD utilities include enterprise resource planning, finance management information systems, materials management systems, human resource management systems, sales and marketing systems, and customer relationship management systems. The OT component looks after the running of CGD operations. It consists of planning and scheduling operations, supervisory control and data acquisition (SCADA), gas measurement and reconciliation, and pipeline integrity, distribution and outage management. However, most of these technologies are currently being operated in silos.
While stand-alone investments in IT and OT are expected to continue, it is the convergence of these that will enable organisations to improve their operational performance and earn higher returns on their investments. This will result in optimised business processes, enable access to better quality information for decision-making, and improve the asset management capabilities of gas companies.
Evolution of IT-OT systems
In the past few decades, the IT and OT systems have evolved significantly for the CGD players. While IT has been growing to provide increased business intelligence, OT has grown to enhance the operational capabilities of companies.
IT has evolved from choosing the best of the available localised applications in the 1980s to cloud-based services post-2010. In parallel, OT has evolved from vendor-managed proprietary control systems in the 1980s to evolved data models for growth post-2010. While these entities individually have shown a significant evolution, they have been growing in silos. What is required going ahead is an integrated evolution of IT and OT, which would be beneficial for the entire organisation.
Benefits of IT-OT convergence for CGD players
A well-organised convergence of IT and OT could ensure a number of benefits for CGD players – improved cost efficiency, increased productivity, reliability and sustainability, and, in turn, an enhanced experience for the end-consumers. It will also help in generating a significant volume of data, which can be used for analysis and data visualisation. This could help the CGD players assess potential risks and also mitigate them.
There are broadly four major areas, which a well integrated IT-OT system can help improve. These include decision-making, automation, value creation and innovation. IT-OT convergence can enable a CGD player to take faster decisions as data generated from the CGD network will be captured by the OT applications, which can then be analysed in real time using IT. This analysis can be used by the decision makers to fast-track their decision-making process.
Further, there are a number of areas in CGD operations, which require routine human intervention. In such instances, automation can help reduce human dependency and drive more precision through automated reports and analysis. This would lead to significant value creation as reduction in instances of human error coupled with improved functionality would help improve the return on investment (RoI) for CGD players. It also encourages innovation as IT-OT integration provides a stable platform, which generates significantly large datasets for a business to innovate upon. This data can be analysed to enable agile decision-making, formulate automations to reduce human intervention, enhance value creation for the company by optimising their process efficiency, and provide a data-based launch pad to propel innovative growth. Eventually, the integrated IT-OT systems would evolve into complete technologies such as platforms, software, and security systems, which can predict and mitigate any potential risks while enabling improved returns for the businesses.
Going forward, a number of advanced technologies such as IoT, artificial intelligence, virtual reality, robotics, drones, blockchain and augmented reality are expected to be increasingly deployed by CGD players. While technologies such as IoT, robotics and drones can be efficiently used for continuous pipeline monitoring and fault detection, blockchain can be used to efficiently manage customer records with minimum human intervention. For example, Tata Communications Limited has tied up with Mahanagar Gas Limited (MGL) to deploy 5,000 smart gas meters in Mumbai. This infrastructure is based on an ultra low-power, LoRaWAN (long-range wide area) network. This will allow MGL to simultaneously monitor thousands of smart meters in Mumbai. To take another example, for securing their gas pipelines, GAIL India Limited is using drones at its Hazira-Vijaipur-Jagdishpur pipeline. This initiative is being taken on a pilot basis and GAIL has hired one drone to maintain aerial surveillance. The drones will be used to patrol the pipeline and detect any physical abnormal activity like encroachment or intrusion on the pipeline. This will allow GAIL to maintain pipeline security, which is a major issue for natural gas suppliers around the world.
Challenges for IT and OT systems in CGD
The integration of IT and OT is a desired outcome for the CGD players. However, this integration is fraught with a number of challenges such as the presence of department-wise silos, and lack of a clear roadmap for IT-OT integration, awareness around the advantages of IT-OT integration and change management capabilities while ensuring absolute data security. To overcome these challenges, the CGD players have to increasingly engage in technology conversations starting from the boardroom down to the shop floor. The adoption of IT and OT must also become a part of the company’s overall strategy and the management should increasingly handhold employees into the increasing use of IT and OT technologies. One area that needs significant attention is ensuring cybersecurity while transitioning from individual IT and OT systems to an integrated solution driven IT-OT environment. Miscreants can target the operational systems using IT infrastructure, which could cause significant loss for the CGD player.
The way forward
While standalone investments in individual IT and OT systems have been propelling effective CGD operations, going ahead CGD players must integrate their IT and OT systems to secure maximum benefit. The management must ensure that IT and OT systems become a priority and are a part of the overall organisational strategy. This would require creating significant awareness about the advantages of IT-OT integration and training employees to operate in the integrated environment. With the advent of new technologies, ensuring appropriate investments in IT and OT systems should be high on the agenda of CGD players.