Effective market design is crucial for the efficient operation of power markets. And now market design is needing to keep pace with developments such as digital and blockchain technology. PwC advises on power sector market design in a wide range of settings around the world. The emergence of new market roles, fast-changing technology, new ways of producing and delivering energy, and changing competitive dynamics present significant challenges for companies and policy-makers alike. PwC can help you:
- Think through future market designs to stay ahead in a digital world.
- Anticipate and implement market changes.
- Manage competition issues.
- Evaluate rates of return.
- Benchmark system performance.
- Comply with regulatory requirements.
Meet Paul Nillesen, our market design expert
Smart energy & renewables
The rollout of smart energy and renewable technologies by utilities is reshaping the way power companies and users manage and think about electricity. Digital technology is transforming the power value chain, from the power plant to the customer and even beyond. We are moving into an era of distributed energy as more customers are producing and storing electricity. This brings significant challenges. PwC can help you:
- Become a truly digital power company.
- Feasibility studies and business case planning.
- Financing support, including modelling project economics and tax, regulatory and accounting issues.
- Tender design, procurement and contracting strategy.
- Governance and support frameworks during project engineering and construction.
- Supply chain analysis and health and safety support.
- Operational excellence and maintenance.
Nuclear power is an established part of the world’s energy mix, providing a source of large-scale, baseload supply in many countries. The strategic role of nuclear power has come into focus as governments move to decarbonise their electricity generation while also responding to rising demand and concerns about energy security. PwC can help you with:
- Strategies and solutions to meet financing needs.
- Devise and structure stakeholder relationships to ensure the appropriate spread of responsibilities and risk.
- Support during the engineering, procurement and construction phase of nuclear plants.
- Asset configuration and support for long-term, reliability-centered operations and maintenance.
- Upgrading power plant operations for the digital era.
- Manage risks, maximise asset value and minimise costs at the decommissioning and disposal stage.
Customer expectations are being transformed by digital technology and modern service standards, raising the bar for power utility companies everywhere. At the same time, the way customers think about power is changing with self-generation and storage become the norm for many. Companies are moving towards a new, more collaborative type of customer relationship – one that puts the customer at the centre of a utility's business strategy. PwC can help you:
- Develop the right customer strategy.
- Get ahead of customer needs and maximise the potential of digital technology.
- Think smart about smart technology to develop a more interactive customer relationship.
- Deliver the right software and IT strategy to match your customer strategy.
- Develop your data analysis capability to create a more personalised relationship.
- Know what capabilities you can deliver yourself and what is available and could be better delivered through outside collaboration.
Enterprise asset management
Innovation in asset management is going hand in hand with innovation in energy systems as power companies strive to reach ever-improving standards of reliability and operational excellence. Digitisation in the shape of enterprise-wide automation and connectivity is revolutionising the scope for lower costs, increasing efficiency and better all-round performance. Smart and digitally-based asset management is becoming increasingly important, especially at a time when so much infrastructure needs to be built. PwC can help you:
- Get the most from technology – ensuring that your enterprise-wide asset management is smart, digitally-enabled and intelligent.
- Get the most from your data – helping you develop data insights to lower costs and improve performance.
- Improve operational excellence - selecting and delivering the operational excellence measures that meet your particular challenges.
- Increase customer retention and growth – measuring and improving the performance of your customer-facing strategies and activities.
- Strengthen financial and performance management – making the most of the financial, operational and regulatory metrics that drive accountabilities, decision support and operational execution.
Deals and energy financing
Deal and financing opportunities in the power utilities sector are now broader and more diverse than ever as the industry experiences an unprecedented wave of transformation. We are seeing new buyers coming into the sector. The shape of the sector is also changing as consolidation remains a strong force. Joint ventures and strategic alliances are becoming increasingly important in the era of digital utility. And convergence between sectors cannot be ruled out as companies address supply issues, the implications of smarter grids and the connected home as well as new uses for electricity. PwC can help you:
- Do better deals and create value through mergers, acquisitions, disposals, restructuring and joint ventures.
- Before and during the deal, we work with you to develop the right strategy, identify the right target, negotiate terms and finance and get the best deal structure.
- We can help execute the deal seamlessly and identify issues and points of negotiation and value.
- After the deal, we are on hand to implement changes to deliver synergies and improvements.
- We are able to help you manage the post-deal integration process, carve out non-core assets, and make changes to realise improvements in long-term performance.
- We can help with a detailed examination of joint venture risks and how the structure can reflect the fact that different parties will be contributing different components to the venture.
Trading and risk management
Energy trading is taking on greater significance as energy systems become more fragmented with multiple sources of generation and market participation. Companies are increasingly engaged in trading to improve and add more flexibility to their customer strategies as well as their own asset position. At the same time, developments in digital technology, algorithms and blockchain have the potential not just to increase trading efficiency but also to disrupt and open up energy markets. PwC can help you:
- Identify opportunities for the application of blockchain and digital technology in your energy trading.
- Set the right strategy, developing clear policies and strategies to understand and engage with the market environment in ways that are consistent with your commercial imperatives and risk appetite.
- Align your activities to fit with market changes and new developments.
- Manage risk effectively, advise on the risk frameworks, controls and systems that need to be in place to manage risks and opportunities effectively.
- Implement trading processes and systems.
- Ensure overall good governance, accounting and compliance.
Capital projects and infrastructure
The scale of capital project investment in the utilities sector is immense and many companies are now managing the biggest capex programmes they have ever undertaken. It is not only the scale that is bigger but the nature of capital projects are very different from earlier periods of capital project expansion. Technology is changing the way projects are delivered and the assets within projects. Digital collaboration and mobile solutions can greatly improve efficiency and reduce costs. And the pace of technological change means you have to allow for technology and software within projects moving on by the time the project is completed. PwC can help you:
- Deliver effective digital solutions to enhance project execution.
- Conduct effective project appraisal – getting things right from the beginning to avoid costly errors later.
- Decide on the right finance and the right contract – including funding options, contractor selection and management, and project and quality management arrangements.
- Keep projects on or ahead of course - budgeting and forecasting processes, project cost and schedule systems, reporting procedures, open book contract control and project audit.
- Get projects back on track – recovering projects quickly and effectively.
- Ensure overall good governance, accounting and compliance.