Discover the renewable energy and sustainability trends impacting the utilities industry, and tangible actions being taken to address them – specifically, sustainable cloud technology.
In this vodcast, Oracle’s Jack Arnold and Hexagon’s Jean-Francois Allard and Jack Williams share valuable insights into the short- and long-term approaches being adopted to reshape the landscape of energy consumption and services.
Watch the video or read the transcript below.
Learn more about Hexagon’s utility solutions.
Transcript
Jack Williams:
Hi, my name is Jack Williams. I’m the Director of Portfolio Marketing for Hexagon Safety, Infrastructure & Geospatial division. Thank you for joining us today. Today we’re going to be talking about renewable energy, sustainability trends and the tangible actions being taken to address this specifically in the utilities industry and specifically around sustainable cloud technology. I’d like you to join me in welcoming Jack Arnold who’s the director at Oracle, someone I’ve gotten to know over the past year and a half. Glad to have him here on behalf of Oracle to talk about some of the things they’re doing and we’re doing together at Hexagon. Then, I’d also like to welcome my Hexagon colleague, Jean-Francois Allard. He’s our director in Europe, Middle East, Asia, Africa, the EMEA region for our utilities and communications division. I’m really excited to talk to both of them and get their insight on the approaches being adopted to reshape the landscape of energy consumption and services. Gentlemen, welcome. Let’s get right to it. Jack, I’m going to start with you. Just give me a brief one-minute intro into who Jack Arnold is and a little bit of your background, sir.
Jack Arnold:
Sure. Thanks, Jack. I’ve got responsibility at Oracle and am focused on Oracle’s cloud solutions delivery basically. I’ve been at Oracle for 16 years, primarily in sales and sales management, so I deal with organizations large and small that are using and delivering Oracle’s cloud solutions, we call it Oracle Cloud Infrastructure, OCI, using that either internally and/or with their customers. Hexagon is one of our closest partners that we work with. That’s my role. Thanks for having me here.
Jack Williams:
Awesome. I will say Jack lives in the great state of Florida by way of Colorado at one point, right, Jack?
Jack Arnold:
That’s right.
Jack Williams:
It’s a pleasure to have you.
Jack Arnold:
Thank you.
Jack Williams:
My good friend across the pond, I believe in Belgium, right, JF?
Jean-Francois Allard:
Yes.
Jack Williams:
A quick background on yourself. I know you’ve been on previous vodcasts with me, but for those in the audience who want a little background, give them a quick one-minute intro.
Jean-Francois Allard:
Yeah, so I’ve been working for the company since ’95, so a bunch of years. My white hair is just proving that I’m an old guy in the company. I have been working in the utilities and telecommunication business since the beginning. I’ve been in my present role since 2017, now six years. My main role is to be between the customers and our colleagues and our R&D, so I’m identifying the market trends, identifying what we call the future candidates for our products to be sure that we have time to market, so this is my main goal and I have to say that I’m quite busy. One minute.
Jack Williams:
Yeah, I know you’re quite busy. I could tell when I try to get an email response from you. I’m kidding! All right, enough of that. Let’s talk, gentlemen. We’re here to talk about sustainability with cloud technology for utilities and communications. First question goes out to… Let’s start with JF, which is short for Jean-Francois for the audience. Jean-Francois, take a step back. What’s the challenge of sustainability look like at a broad sort of global level as it relates to the utility industry? Can you give me a big picture of maybe the sustainability trends, some of the challenges that you see?
Jean-Francois Allard:
Yeah, good question. I think we can look to the sustainability trends in the utility market on two sides. First is what they are getting from their own consumers, but also the people connected to their network, because all of us, we are trying to be greener, to be more sustainable. You have already seen windmills, a lot of solar farms, solar panels on the roofs. All of this is influencing the utility companies because they have to absorb… When they are the distribution company, they have to absorb all the external renewable energy coming to the network. It’s a challenge. They really have to adapt to be very agile to enhance or improve the device they’re putting on the network to absorb this.
On the other side, they’re also their own challenge because every company worldwide is pushed by governmental regulation to be much more sustainable. This means they have to consume less and they have to look into all directions. You know the easy ways are about company cars, company vehicles being more electrical or at least hybrid. They can also influence their own employees to be greener, to consume less at the office. But of course a big element in the daily consumption of energy for a utility company is driven by IT, data centers, it’s a big pool of consumption, and this is where also they are looking now to see how they can be more sustainable.
Jack Williams:
Excellent. Jack Arnold, anything to add to that in terms of some of the sustainability trends you see in the utility space?
Jack Arnold:
Yeah, I mean, I think in addition to JF’s points, of course Oracle is a large consumer of energy, so we’re on that end of it, but we also provide solutions to the utilities companies and their customers. I think in the industry, sort of the trends that we see is there continues to be more and more regulation moving toward sustainable capabilities and green delivery of solutions, if you will. That’s driving us along with utilities companies to be much more efficient in the production and usage of energy. I think that utilities are trying to balance the move to renewables with the geopolitical realities of satisfying their customer’s needs for energy, be it with hydrocarbons or renewables, and trying to continue to move down the path towards more and more renewables. I know that is a challenge that we face within Oracle and within Oracle’s cloud specifically, we’ve got close to 50 global data centers that have to deal with those kinds of dynamics every day. Those are the things that we see driving the utilities industry as general trends.
Jack Williams:
Gotcha. I mean, when it comes to sustainability and utilities, there’s obviously… If there’s one industry where that is more prominent, I’d like to know because that’s probably a word that they hear every day, how to be more sustainable. Whether it’s a mix of different types of energy sources, renewables, et cetera, there’s a lot of trends really impacting utilities today around this topic. Let’s dial in a little bit more and talk more I guess on the technology side, which is why you two are here. When it comes to the cloud, what can the cloud bring to the table for utilities in terms of meeting this challenge of sustainability? JF, you want to start out?
Jean-Francois Allard:
Oh, yeah. I think from my point of view, what I see, so we are selling software solution, and our customers, they always start asking us, “Okay, could you dimension the solution you are providing?” This is a key element, I think, driving the sustainability because when our customers are buying their own hardware to put on-prem, the first question they have in mind is “what will be the peak of the usage of my platform?” They systematically acquire a platform that is dimensioned for the peak they could one day reach in the life of the hardware. This is, in my opinion, where the cloud is very, very powerful because instead of dimensioning the solution for your peak, you dimension the solution for your average usage, and very often the average usage is twice lower than the peak, and of course the cloud can absorb the peak because it’s built to achieve this kind of support. This is where I think the IT departments of a utility company can become very, very sustainable just by decreasing the energy they need for the normal usage they have of a data center or a pure IT solution.
Jack Williams:
Jack, anything to add to that in terms of…?
Jack Arnold:
Yeah.
Jack Williams:
Yeah, go ahead.
Jack Arnold:
Definitely. I know, JF, you sort of hit on customers typically designing for peak usage. I think there’s a couple of bullet points really that highlight this trend of customers moving toward using the cloud. One is the fact that cloud, specifically Oracle’s Cloud Infrastructure, can bring a high degree of efficiency to the IT operations. That happens in a couple of ways. One, we have very scalable technologies that allow you to basically scale up and scale down automatically, or autonomously as we would call it, and that prevents you from having to keep a bunch of servers on kind of in a standby mode when they’re not actually being used. That broadly helps everybody’s efficiency and helps the utilities that are needing to drive their efficiency rates higher, for sure.
I think another key aspect of this drive to the cloud is data integrity and data sovereignty. It’s very difficult, especially if you’re maybe a smaller-medium business, tier two or tier three, to have the resources that are skilled in managing data integrity, all of the certifications that are needed to ensure you’re operating according to the local government’s regulations. I’d say some of the three big drivers are efficiency, automatic scalability and data integrity and sovereignty are the three top drivers of people moving to cloud.
Jack Williams:
Gotcha. Let’s take a step back. There’s an obvious challenge of sustainability for utilities and telecoms, and there’s a lot of different aspects to that. We dialed in and there’s some drivers in terms of what can the cloud technology do to help address that challenge or that initiative of sustainability for utilities. You talk a lot about efficiency, flexibility, automatic scaling, data integrity, data sovereignty, just overall efficiency. Let’s also talk about once the, let’s say utilities and telecoms, they’re on the cloud. In terms of sustainability, but also what other additional value can they get along with helping to meet some of those sustainability goals? How can that help them progress on their digital transformation or modernization journey by being on the cloud? What’s that additional value? JF, do you want to take a stab at that?
Jean-Francois Allard:
Yeah, that’s a good question. I’m a personal pusher for the cloud because, as you say, the cloud is not only getting your hardware and your solution somewhere else than on-prem, no, no, it’s much more. Once you are in the cloud, automatically you get a more collaborative environment. It’s obvious, but once your system is in the cloud, you can access it from anywhere, from everywhere. This means that yourself, you can access it, but the support can access it also. Also, if you want to share information, once it’s in the cloud, the capabilities of such a system are infinite, so you can really do whatever you want. In the utilities, for example, it’s already a modern trend today, but all the sensors that you can get, most of them are connected already to the cloud.
All the data, the real-time data that you get from the sensors, I mean pressure, electricity, voltage, all kinds of sensors you can imagine for a utility company, all this information is already transferred automatically to the cloud where it’s processed through edge computing. You will do aggregation statistics, really very deep analytics, and all the information can come back to your system on-prem or in your own cloud in the form of pure data or alarms. Entering into the cloud, it’s also entering in a much more real time world with much more data sharing between colleagues but also between organizations. I think that today we can understand what is feasible, but I really think we can just imagine 10% of what could be the future once you’re in the cloud.
Jack Arnold:
Good points. I mean, I think what I see a couple of additional areas where customers benefit as they move into the cloud. I mean one is just capability for innovation without being hindered by I think what we’ve all seen over the years of historical technical debt, older technology that needs to be supported by somebody in a company that has to exist simply to support something that may be 10 years old. When you’re in the cloud, utilizing, delivering and deploying new technologies really is much, much faster than historically it’s been on premise. I think innovation happens much faster.
I think also the younger generation… I have a few of those same gray hairs that JF mentioned. I think the younger generation is very familiar with using things in the cloud, all kinds of applications that we’re all familiar with on our phones are delivered by the cloud. I think basically the up-and-coming generation that wants to get into innovation and not be hindered by older technologies, cloud allows them to do that much faster. I think those are a couple of the key drivers. I think companies as well, just financially, find that they don’t have this huge technical debt of support that they have to maintain with a lot of their older technologies, so financially it gives them a lot more flexibility.
Jack Williams:
I would also like to add and get your thoughts on this too. I mean, I’ve had many conversations with folks like yourselves in different industries about moving to the cloud, innovation, the ability to collaborate, the ability to integrate with edge technology, IoT devices, sensors. I love the technical debt mention, Jack. Technical debt, a good way to think about it is I have a system and it can’t quite do what I want it to do, so I build a workaround and some custom code, and then I have a workaround on top of a workaround on top of a workaround. The next thing you know, you got this tangled mess that… It’s hard to maintain. That ability to update on the cloud and stay with the freshest version, I mean that’s so key. That’s across industries.
But what about the cybersecurity, right? I mean, I don’t have the exact number, but it’s something to the effect that big cloud providers like yourself, Jack, you’re really investing in cybersecurity and there is a lack of talent and skills that utilities, or like I said, I do a lot in public safety agencies, they don’t have those necessary skillsets in-house, and if they do, they’re hard to attract and retain. Then, you got companies like Oracle investing millions and millions of dollars in that. Can you speak to that, Jack, real quick?
Jack Arnold:
Yeah, I mean I think you hit on some key challenges in terms of security both relative to application security, the software that you’re using, the hardware infrastructure security, all those things are extremely expensive just in one data center. If you’re a global company, which Hexagon is, Oracle is, the capability for any one company to have the skilled and knowledgeable resources to manage all of that cybersecurity regulatory environment is extremely difficult. It’s hard to find those people, hard to maintain those people. I think allowing a cloud provider like Hexagon in partnership with Oracle to manage that for you, when collaboratively we can ensure that we’re up-to-date on all of the appropriate regulations, it takes a huge challenge off of your shoulders to do that internally. We all know we’ve all been hit by cybersecurity breaches. I don’t know of anybody that I know that has not. I think the more that we can depend on organizations that can focus their talents on those things and allow our customers to focus on what they’re good at, then that’s a win.
Jack Williams:
Yep. I agree. Leave it to the experts, right? I mean, because you’re going to inherently get all those built-in cybersecurity tools. I think that’s just a really big piece of additional value, that the cloud provides, because I don’t care who you are, your on-premises system or your legacy system, guess what? Somehow some way that thing’s connected to the internet, so there’s got to be some vulnerabilities. The real time updates, the patching, just the sheer investments relying upon your solution providers and partners like Hexagon, Oracle, I think it’s a no-brainer. I did want to bring that one up because I’ve been seeing that a lot lately.
Jack Arnold:
A very good point.
Jack Williams:
Okay. By the way, I think there was some recent news where they said that 10, 20 critical infrastructure providers in the United States have been hacked by some foreign entity over the last 12 months, so it’s something in the news today, right?
Jack Arnold:
Absolutely.
Jack Williams:
All right, so enough of me, let’s talk to you two. Hey Jack, for us, why don’t you give us a quick overview of the cloud infrastructure in terms of how Oracle envisions it, envisioning how the cloud is progressing and in alignment with sustainability objectives, and anything you’d just like to mention about the Oracle cloud itself?
Jack Arnold:
Yeah. Oracle Cloud Infrastructure, again, we call that OCI, really is a generation two cloud solution that Oracle is delivering and really provides some very key capabilities to our customers in terms of a couple of things we’ve talked about: efficiency, innovation and sustainability. A couple of the goals that Oracle has for sustainability, and this is also a part of our cloud set of goals. By 2025, for instance, Oracle is looking to be carbon-neutral and using 100% renewables. Today in Europe, all of our data centers are driven by 100% renewable energy, so we are well on our way there. We’re at about 88% in terms of running on renewables globally, as I said, all of Europe, Oracle’s data centers in Europe are.
By 2030, we’re looking for a 50% reduction in emissions. As we mentioned earlier, data centers are a huge consumer of energy. In order for us to continue to grow and for our customers to have solutions that are available in their countries for instance, or in their areas where they can hold data, we’re going to have to continue to drive efficiencies and move toward renewables. Ultimately by 2050, Oracle wants to be at net-zero in emissions. We’ve made tremendous strides in going down this path. We have near-term and long-term goals. We have, for instance, today almost 90% of our key suppliers have sustainability programs themselves, so we are driving that with our suppliers. This ultimately accrues to our collective customer base. Hexagon and Oracle’s customer base are the recipients of those kinds of benefits when our collective supplier base has sustainability programs in place. Today, 100% of all of our data centers either reuse or recycle all of the hardware that is in a data center, which you can imagine is massive.
One of the key things that we didn’t necessarily mention is just the capability of being able to keep a stride of new hardware trends in cloud data centers is an advantage to our collective customers. Well, when you do that, that means the old computer equipment has to go somewhere, it’s got to be reused or recycled. Today, we’re at 100% of that. Lastly, what we call our scope one and scope two, which are sort of direct and indirect emissions, either that we emit or that our providers emit, have been cut in half in the last three years, and that’s measured by kilograms of CO2 per kilowatt-hour. We just made tremendous strides in Oracle’s cloud sustainability goals and what we’ve actually already done really over the last few years. I’ll stop with that, but it’s a huge goal and a huge impact no matter where we are because there’s only a certain amount of energy that is going to be delivered to us and we’ve got to be able to use that efficiently when we deliver our solutions to our collective customers.
Jack Williams:
I totally agree, Jack. JF, I’m going to pivot to you. Can you provide a brief explanation of the significance of developing, a term you like to use, a relational digital twin? Why is it considered foundational for constructing a more adaptable future in the utilities industry, especially as it relates to renewables? What’s the significance of this concept of a relational digital twin, Jean-Francois?
Jean-Francois Allard:
Very short, what it means is that you build a digital twin, so it’s an image of the physical world where you have all the components of your networks but with a relationship between them. It’s good to have an idea about the location of pipes or the cables, even the information about the material. But if you don’t know how they are connected, and for example, in case of a break or a leak somewhere, if you don’t know which customer is impacted or what will be the impact on the rest of the network, if the rest of the network will be overloaded or not. What is the benefit of a digital twin? That’s why we are, for many years now, investing and implementing relational digital twins so that we can provide this kind of information.
But now that the digital transformation is there and all customers are more and more acting from the digital point of view, I mean, instead of sending people in the field to get information about a specific device, all the information is coming through the telecommunication so you know at any time, what is the status of a meter, the state of the pressure in the pipe, you know all the information. If you have a digital twin with this relationship information and an event is located somewhere and you get information about this event in real time, it can lead you to support in a preventive way all the customers. You can be sure that you will be able to balance in real time your network in the right way. This is what this kind of digital twin can bring.
In addition to that, moving to the cloud will bring much more capabilities because today most of our customers are working, for example, in 2D, two dimension, for many reasons, speed to design, but also easiness to maintain the network. But we all know that the 2D digital twin is not a real picture. We have to go for 3D, but 3D means also more GPU processor, more energy, more scalability in the need for your hardware. That’s why moving to the cloud will also bring much more richness in the digital twins of the future. This is really what we are targeting.
Jack Williams:
Excellent. Well, thank you gentlemen. I got one last question for you. For those watching this, recently Oracle and Hexagon announced and broadened their collaboration efforts by introducing a fully managed cloud solution tailored for utility companies to manage their assets in a geospatial context. Jean-Francois, what does this collaboration, this sort of extended partnership with Oracle, bring to the table for both us and Oracle? How does it help with the sustainability goals? Any thoughts on that?
Jean-Francois Allard:
Yeah. We knew that we had to go towards the cloud. We all know that this is a trend, even if the utility market is moving slowly, all the new customers are expecting a solution that runs in the cloud. For us, we are a software provider or solution provider, we are not really in the hardware technology, we are not IT specialists, so we were looking for a solution, sustainable, but also bringing as much autonomy as possible. That’s why we started discussing together with Oracle, discovering what they were able to provide. What they do is something a bit unique currently in the market, in my opinion, because you get a full autonomous platform… I mean, they provide automation in the way that the platform is maintained, is scaled, is secure. Also, for us it was very interesting because it allows us to limit all investments in the business we already know and to get all the security from the platform itself.
This means that we can continue to be as sustainable as we can in our own business and to let Oracle continue investment on this side. The combination of both will bring a total solution that will be very, very sustainable and more and more sustainable from time to time. That’s why this partnership is, I think, a success and will be a success in the future.
Jack Williams:
Jack, would you like to comment on that?
Jack Arnold:
Well, I think it’s just been a special experience working with the Hexagon team led by Jean-Francois really over the last two years. I mean, the degree of expertise that Hexagon brings to this marketplace really is unparalleled, I think. I do agree that this really brings the best of both worlds. A solution that Hexagon has a really unparalleled history and decades long delivery to customers that backs up what they can do along with Oracle’s capabilities in the cloud and global reach to do those kinds of things with the broad set of customers, small, medium and large, that Hexagon either currently has with customers or is targeting. I think it’s just really an unparalleled partnership that we have brought together for success, and looking at even much more success into the future. We’re really looking forward to that and excited about this partnership.
Jack Williams:
Excellent, guys. Well, any parting thoughts that either one of you would like to say before we jump off here? All good?
Jack Arnold:
I think all good on my end. We’re excited to move forward and see the additional success in the future.
Jean-Francois Allard:
Exactly.
Jack Williams:
All right. Well, hey, Jean-Francois, Jack, always pleasure to meet another Jack in the world, and Jean-Francois, always a pleasure to talk to you, my friend. Thank you both for joining, taking the time out of your busy day. I really appreciate it. I look forward to seeing you all here pretty soon in person. For our audience, thank you for joining, we appreciate your time and stay tuned for more vodcasts from Hexagon Safety, Infrastructure & Geospatial. Thank you very much.
Jack Arnold:
Thank you.
Jean-Francois Allard:
Thank you. Bye.
