What We're Reading: Hydro's Digital Generation

By Daniel Palmer on January 26, 2021

We recently enjoyed Accenture’s 2020 report Hydro’s Digital Generation: Transforming for the future of hydropower. Grounded in hydropower’s potential role as a source of dispatchable energy and storage in a future increasingly powered by intermittent renewables, the report offers hydro operators five themes to consider so they can play a starring role in the grid of the future. 

Accenture's Hydro's Digital Generation Report
Accenture's Hydro's Digital Generation Report

The report explores a range of solutions for hydro operators to move toward “digitally enabled, data-driven operation,” from maintenance analytics to virtual reality training for operators. The first recommendation, though, especially resonates with our work on HydroForecast: “production management and optimization” through “digitally improved forecasting and analytics.” 

As the report explains, 

[Inflow forecasting] is an area high on the agenda for operators, as it not only gives oversight on how much power and by extension—revenue—can be generated, but also enables the mitigation of flooding risk. Both qualities will be increasingly important in the coming years with the rising frequency of extreme weather events. 

The challenges Accenture identifies for high-quality inflow forecasting are the same ones that motivate HydroForecast:

  • Cumbersome or manual processes to aggregate and utilize weather forecast data hinder generation planning calculations
  • Even with good data, creating accurate forecasts is challenging, and operators often lack trust in the forecast data
  • Without confidence in their forecasts, operators “bid conservatively to avoid penalties for under-production,” leading them to miss out on revenue

We’ve seen these hurdles borne out with our customers; they informed our experience designing HydroForecast to automatically ingest and update the world’s best meteorological data for our customers and are why our forecasts include confidence intervals that indicate moments of high uncertainty. With highly accurate forecasts in their toolkits, our customers leave less revenue on the table. 

Likewise, Accenture’s analysis rings true to us. With tools to “aggregate large volumes of data from multiple sources” and “analytical capability...to process the incoming data,” Accenture reports that improved inflow forecasting can earn operators “between 5% and 15% reduction in lost production.” 

The report closes on a promising note:

As with all renewable technologies, digital will transform the competitiveness of hydropower. As the largest installed source of renewable energy and energy storage, the value of hydropower, particularly pumped hydro, increases in markets with high penetration of wind and solar...In markets with the appropriate geographic conditions, hydropower will be an attractive complement to the greening of the energy mix.