Digitization Takes Centre Stage
The energy sector is undergoing a dynamic shift and is increasingly being equipped to address the key imperatives it faces today with the emergence of a new trend called the ‘digitization’ of energy.
Integrating digital into the energy domain is seen to be a dominant factor in achieving energy conservation and efficiency as well as economical and environmental benefits in the future. Digital will also have a positive impact on a new global energy security order emerged with the drop of oil prices.
The digital transformation plan is supported by underlying technologies and capabilities such as network connectivity, computing, and storage, all of which enable the digitization of back-end and front-end processes. The innovations in big data, the internet of things, cloud computing and analytics, is producing new and improved products, services, and business models across the sector.
The future of digitization in the Middle East suggests strong economic growth potential leading to higher GDP. More and more companies across the region are expanding their digital portfolios, with most planning to invest 4% of their annual revenues in digital solutions. According to a study, the digital market could contribute upto 3.8% annually in the region’s GDP by 2020, amounting to $95 billion.
GCC countries are generally more digitized in Mideast. The UAE government leads in adoption of digital technology. As part of ‘UAE Vision 2021’, it focuses on the development of smart cities, advanced technology such as artificial intelligence, nanotechnology, and 3D printing, and its quick applications.
Switching to digital is one of the top National Goals of Saudi government. Various initiatives have been highlighted in its ‘National Transformation Program 2020’. Other countries also have made considerable progress in this arena.
Each successive wave of digitization is reshaping the current business structure around the Middle East. It is allowing oil and gas companies to optimize production and reduce unplanned downtime thereby enabling greater cost efficiency. Also, high-risk operations could be automated.
The rapid progress in power technology such as energy management systems, smart meters, automated demand response and grid intelligence is helping the region in its digital drive. ABB has recently launched its industry-leading portfolio of digital solutions, which will produce tangible business opportunities.
Digitization is already transforming the Middle East. It brings in capital, employment prospects, and economic productivity. To maximize further gains, the region needs collaboration of government leaders and individual agencies to develop a comprehensive plan on governance, business, R&D, financing, and skills while moving ahead on the path to digital.