---
title: What Is Energy 4.0? - The Technologies Powering the Future of Utilities
description: The electric power utility industry has reached an inflection point. Accelerating trends toward renewable energy, distributed grids, labour shortages, and more frequent and severe weather events are taking a toll on aging infrastructure that was not designed to meet the challenges of the future.
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---

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# What Is Energy 4.0? - The Technologies Powering the Future of Utilities

by [Richard Harada is Vice President Product Management & MarketingSystems With Intelligence.](https://info.systemswithintelligence.com/systems-with-intelligence/author/richard-harada-is-vice-president-product-management-marketingsystems-with-intelligence-)   |   Dec 27, 2023

The electric power utility industry has reached an inflection point. Accelerating trends toward renewable energy, distributed grids, labour shortages, and more frequent and severe weather events are taking a toll on aging infrastructure that was not designed to meet the challenges of the future.

As utilities continue to modernize and invest in the grid, new technologies are needed to adapt to changing grid conditions, optimize performance, and mitigate the risk of outages. Those that take a strategic approach and implement the right solutions today will gain greater situational awareness and control over high-value and critical assets, positioning the organization for long-term success.

*To learn more, read our recent white paper, published at Electric Energy Online* [*Energy 4.0 and Remote Asset Monitoring - How Utilities Benefit From Smart, Connected Devices*](https://electricenergyonline.com/energy/magazine/1409/article/Energy-4-0-and-Remote-Asset-Monitoring-How-Utilities-Benefit-From-Smart-Connected-Devices.htm)

### What Is Energy 4.0?

Industry 4.0 has long been a buzzword in the manufacturing and industrial sectors. Representing the fourth industrial revolution, Industry 4.0 highlights the ongoing transition from early steam and electric power to modern advances in computing, automation, data and analytics, networking, and cloud services.

Energy 4.0 applies the same concept to the electrical power utility industry. Energy 4.0 is a general term for the collection of utility hardware, software, and technologies that leverage connectivity, data, and computing power to modernize the grid and improve performance.

Examples range from consumer-facing smart home electronics and smart meters that provide real-time usage and billing data to remote monitoring solutions that dramatically reduce the time and cost of maintenance and inspections.

Just as Industry 4.0 technologies have created new opportunities in manufacturing, Energy 4.0 technologies have the potential to transform how generation, transmission, and distribution infrastructure is managed, maintained, and upgraded.

### What Are Energy 4.0 Technologies?

***The Industrial Internet of Things***

The Industrial Internet of Things (IIoT) is a network of physical devices or sensors that collect, exchange, and transmit contextual data which can be used by both operators and strategic decision makers. For example, connected IIoT devices can monitor asset health, detect load changes, and verify overhead switches, or identify performance degradation.

The [global utility IIoT](https://www.futuremarketinsights.com/reports/iot-in-utilities-market) market was valued at US$36.8 billion in 2021. But soaring adoption and rapidly advancing technology mean the market is expected to grow to more than $129 billion by 2032.

### Cloud Computing

Cloud computing is the on-demand delivery of computing services over the Internet. Examples include access to servers, storage, databases, networking, software, analytics, or other IT services. Compared to traditional, on-premises IT infrastructure, cloud service providers offer highly flexible and scalable resources at a significantly lower overall cost.

Further, because it is their core business, reputable cloud service providers are generally able to offer stronger security, better performance, and more frequent updates than a typical in-house IT department.

While utilities are understandably concerned over potential cybersecurity and compliance risks, it’s likely that many are already using cloud services for applications such as office software, email, data storage, or other workplace collaboration tools. Other widespread examples of cloud technologies include online and mobile banking, streaming services, and e-commerce.

A recent survey showed that [nearly all utility leaders](https://www.accenture.com/ca-en/insights/utilities/cloud-imperative-utilities-industry) have implemented some level of cloud solutions, compared to less than half of lower-performing utility companies.

***Data and Analytics***

Data and analytics solutions allow utilities to [collect, store, and use data](https://www.gartner.com/en/topics/data-and-analytics) from multiple sources to improve decision-making, business processes, and performance.

While utilities have always had access to data, much of it has historically been collected manually and stored using paper records, making it difficult to find, use, and interpret data when making decisions. In contrast, today’s advanced technologies make it possible to automatically capture massive amounts of data, conduct detailed analysis, and access insights at any time, anywhere, on any device.

A recent study found that [52 percent of electric utilities](https://www.osti.gov/servlets/purl/1639296) had already or were currently implementing big data analytics.

***Artificial Intelligence and Machine Learning***

The terms artificial intelligence (AI) and machine learning (ML) are sometimes used interchangeably - but they are actually two different concepts with their own applications and advantages. AI allows computers to [analyze and contextualize data](https://ai.engineering.columbia.edu/ai-vs-machine-learning/) to provide information or automatically trigger an action without human intervention. ML, on the other hand, is a subset of AI that uses algorithms to [automatically learn and recognize patterns](https://ai.engineering.columbia.edu/ai-vs-machine-learning/) to increasingly make better decisions.

More recently, generative AI platforms such as ChatGPT use the patterns and structures identified from training data to [create](https://www.mckinsey.com/featured-insights/mckinsey-explainers/what-is-generative-ai) new text, images, video, code, or other content.

AI/ML have been making headlines as each new advancement demonstrates the power and potential applications of the technology across a range of industries. Within the utility industry, a third of companies have already begun to [pilot generative AI](https://prod.ucwe.capgemini.com/wp-content/uploads/2023/07/Final-Web-Version-Report-Harnessing-the-Value-of-Gen-AI.1.pdf) as a way to accelerate growth.

### Embracing Energy 4.0 Technologies for Long-Term Success

Emerging trends are driving utilities to implement better, more efficient ways of managing and maintaining grid infrastructure while optimizing the performance of high-value assets.

As utilities continue to invest in and modernize aging grid infrastructure, Energy 4.0 technologies including IIoT, cloud computing, data and analytics, and AI/ML will play an increasingly important role. Those that take a strategic approach to technology and invest in the right solutions today will emerge as the companies best positioned for long-term success, profitability, and growth.

*This article is part of a series on Energy 4.0 and the role of utility technology. To learn more, read our recent white paper at Electric Energy Online,* [*Energy 4.0 and Remote Asset Monitoring - How Utilities Benefit From Smart, Connected Devices*](https://electricenergyonline.com/energy/magazine/1409/article/Energy-4-0-and-Remote-Asset-Monitoring-How-Utilities-Benefit-From-Smart-Connected-Devices.htm)

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#### About the author

 Richard Harada is Vice President Product Management & MarketingSystems With Intelligence.

Topics:   [Industry Insights](https://info.systemswithintelligence.com/systems-with-intelligence/tag/industry-insights)

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