The Energy Orchestrator’s Playbook with SAP S/4HANA and KPMG

A huge shift for the utilities industry is being accelerated by technological disruption, climate pressures, and some AI giants morphing into energy producers themselves. Brad Stansberry, Partner, Energy and Chemicals Advisory Leader, KPMG US notes, “The utilities industry is at a watershed moment as the old model of simply delivering energy is being replaced by the need to become a dynamic Energy Orchestrator.”  

Thus, “a digital core like SAP S/4HANA should be non-negotiable to manage the increasingly complex system of power generation, distribution, and consumption for the modern utility provider,” observes James Bushnell, Principal, KPMG US.  

The Intelligent Digital Foundation 

As an engine for evolution, SAP S/4HANA offers capabilities that are vital for an Energy Orchestrator. They include: 

• Real-Time Intelligence: SAP S/4HANA’s in-memory architecture processes immense data volumes at high speed. For utility juggling grid conditions, fluctuating market prices, and resource availability, this is the key to helping optimize dispatch decisions in near real-time. 

• Integrated Process Management: The unified data model helps to remove the traditional silos between asset management, customer operations, and finance. This allows for the creation of a more seamless information flow enabling critical capabilities like end-to-end flexibility management. 

• Ecosystem Integration: An API-first architecture is essential for the new energy game. It enables utilities to connect with a diverse network of external partners, complex microgrids, and virtual power plants (VPPs). This flexibility unlocks new business models, allowing the utility company to configure products and services, like specialized capacity-sharing agreements with new tech partners. 

• Advanced Analytics and AI: The platform comes with predictive maintenance algorithms to foresee equipment failures and has sophisticated customer engagement systems for personalized energy-saving advice, transforming relationships with the end consumer. 

Guiding the Transformation 

“While SAP S/4HANA is a powerful tool, the transformation of a utility to an energy orchestrator requires comprehensive business and cultural integration,” says Todd Durocher, Principal, Power and Utilities Transformation Leader, KPMG US. This is where a business integrator like KPMG can help chart this complex course by: 

• Defining a clear transformation strategy with a target operating model, phased roadmaps, and a robust business case. 

• Enabling change by assessing organizational readiness, developing targeted change strategies, and creating training programs for the new roles and skills required. 

• Driving business process innovation for core processes and emerging capabilities like flexibility management. 

• Designing robust, future-aware technology architectures, including SAP and non-SAP components. 

• Integrating and helping to manage AI with a clear strategy and governance framework that seeks to balance automation with essential human experience. 

Zoe Thompson, Principal, Energy and Chemicals SAP Leader, KPMG US concludes, “A utility’s journey to becoming an energy orchestrator demands a deep cultural shift. With expert guidance, utilities can evolve from a mindset of risk aversion, functional silos and technology resistance to one of calculated innovation, ecosystem-wide collaboration and a culture of digital fluency.” 

What This Means for SAPinsiders 

Bridge your core operations for real-time flexibility. SAPinsiders in the utility sector should leverage SAP S/4HANA’s real-time processing and unified data model to eliminate the walls between their operational technology and information technology. This gives the organization a single, live view of the entire grid, from asset health to customer billing. Moreover, it’s the only way to make the split-second decisions needed to manage a volatile, decentralized energy market and offer new flexibility services. This means organizations must audit their most critical data silos, pinpoint the most painful information gap and model how an integrated view in SAP S/4HANA could immediately create value. 

Embrace S/4HANA’s API-first architecture as a strategic business tool. A utility’s future value lies in connecting to and managing a complex web of external partners, microgrids, and virtual power plants (VPPs). Thus, an open, adaptable architecture is key to moving from a closed system to an open one. To achieve this, SAPinsiders should map their five-year partner ecosystem by designing an API strategy that prioritizes these connections to unlock new business models like EV charging partnerships or renewable energy marketplaces. 

Lead the cultural shift or the tech won’t matter. Simply implementing SAP S/4HANA without rewiring the organization’s DNA can severely limit a utility’s ROI. While technology is a powerful enabler, championing a high-visibility pilot project forces cross-functional collaboration and demands a degree of managed risk. Use this project as a cultural incubator to build the digital fluency and ecosystem mindset the team needs to wield the power of the new digital core. 

Read these KPMG whitepapers to learn more about how SAP S/4HANA enables utility transformation: 

• The Energy Orchestrator: Redefining the Future of Utilities 
• Inside the Energy Orchestrator: A New Operating Model 
• Powering the Energy Orchestrator: How SAP S/4HANA Enables Utility Transformation 

*Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.