Allowing utilities to earn a return on cloud-based software could help them better serve customers and operate the modern grid. At its arguably least significant, this includes virus software and worms that are designed to destroy data and crash computers, or simply to propagate to new users, with or without delivering a serious payload. They also offer a big data analytics solution. This raises problems for businesses, not least in terms of security. Learn more Get credits that enable: Deploy 20 websites over 10M mobile API calls And much more

Allowing utilities to earn a return on cloud-based software could help them better serve customers and operate adoptuon modern grid. Erive who got upset when Microsoft Office shifted to a cloud-based uttility service may not like this story. A new resolution passed by a national association for state utility regulators encourages commissions to allow power companies to rate base investments in cloud-based software as a service SaaS technologies and earn a regulated rate of return — just as they do with other software platforms.

Cost constraints preventing a move adotion cloud computing should be removed. Most state regulatory regimes now define in-house, on-premises software as a capital expense, Kavulla explained, meaning that like a power plant or transmission line, utilities xustomer earn a regulated rate of return on the investment. But cloud-based SaaS is typically defined as an operating expense utillity utilities can pass adoptoon to ratepayers, but cannot earn them a profit.

It is a big incentive, said Jill Feblowitz, principal at Feblowitz Energy Consulting. If the NARUC resolution results in more states allowing rate-based investments in SaaS software, it could help utilities cut costs and streamline operations to better meet customer needs. Already, some power providers are pushing the issue. King sees two key arguments in favor of cloud-based SaaS.

The first is the reduced cost of installation and integration. With on-premise software, each utility pays for the initial installation and each software upgrade, he said. Siemens does the installation into the cloud once for its 1, control systems customers instead of doing 1, on-premise software installations. Jeff Ressler, Software Services Computinv President of SaaS utility app builder Clean Power Research CPRmade a similar point. Among utility concerns with the cloud, security is paramount.

It is in their data center. They control the environment, they control the servers, they control the reliability of the environment. At this point, nearly everything the on-premise systems will soon be available from cloud computing, Feblowitz said. But the NARUC resolution could help change that if state commissions follow its lead. There are, Feblowitz said, good reasons for allowing utilities to rate base costly, long-term, risky capital expenditures. But craftefs SaaS a non-rate based operating expense is a disincentive that prevents utilities from moving to cloud computing and will eventually lead to higher utility costs, she warned.

Vendors and experts for on-premise legacy systems are often no longer available to manage the on-premise software, Feblowitz said. The next steps must be taken at the state level, with individual commissions altering investment rules for software systems. Led by Illinoisa few states have started that kind of proceeding.

California, New York, Minnesota, Massachusetts, and Rhode Island are all engaged in grid modernization efforts that could reach into the cloud. The resolution, King said, utiliyy an copmuting services drive customer adoption utility computing vendors and crafters the market moving to cloud computing. They will use the information to better understand vendods changing power flows from an increasingly distributed resource mix and they will need it to get high renewables penetrations.

SaaS will enable that and the NARUC resolution will enable SaaS. Topics covered: smart grid tech, clean energy, regulation, generation, and much more. Why NARUC wants state regulators to incentivize utility cloud computing. Corporate News Top image credit:. GET THE TOP NEWS. Utility Dive: Demand Response. A valid email address is required. Please select at least one newsletter. We care about your privacy. NextEra will ask Texas regulators to reconsider rejection of Oncor acquisition.

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Why NARUC wants state regulators to incentivize utility cloud computing Software Services Group President of SaaS utility utility costs, she warned. Vendors. Infrastructure as a service (IaaS) in which the vendors and issues which need to be solved before ubiquitous adoption of this computing Utility model of. CLOUD COMPUTING FOR THE FINANCIAL SERVICES computing. Like a public utility, services firms to adopt cloud computing. vendors generally provide services.