Before the official start of its Minds + Machines event in San Francisco this week, GE announced the launch of its “Digital Power Plant” during a briefing for the trade press. A formal announcement was to follow in the afternoon.
Dick Ayres, general manager of software solutions, power generation services, explained that the company’s Predix platform launches today as an “industrial application platform” that uses a suite of applications to leverage data both from existing infrastructure and external sources.
The Digital Power Plant includes asset performance management, with its familiar alarms and reports, plus a “layer of optimization” at the plant site, plus “business optimization” that connects the plant to traders and dispatchers. One set of cloud-based data can be used by different groups for different purposes.
Monte Atwell, general manager of product management, power generation products, said GE has spent the past five years “testing and validating its gas turbines”—including on a new off-grid, full-load test stand in Greenville, S.C. (video)—to explore the equipment’s limits. Now, it’s applying digital technology to operate the machines in “a very flexible way.” Most plants, Atwell told POWER, won’t need new sensor capability.
“This is going to evolve,” Atwell said. “This is a step in the journey.”
The journey is toward realizing GE’s new identify as “the world’s Digital Industrial Company.” As Atwell explained, “Just a software company can’t do this; just an industrial company can’t do this.” A combination of deep knowledge of machines, married to the digital technologies used at a scale enabled by the cloud, is required to deliver a truly useful “digital plant.”
Asked by POWER about current Digital Power Plant customers, Atwell noted that Exelon and PSEG (both involved in presentations at the event this week) are existing customers, and the company is in “active discussions” with others around the world.
With Exelon, gas turbine plants aren’t the only generation involved. GE is also working with Exelon’s nuclear and wind fleets to bring the Digital Power Plant concept to life.
When asked by POWER about the difference between existing best-of-class monitoring, control, and analytic systems and the Digital Power Plant, Ayres responded that “the majority of what exists today is a single-point solution,” such as vibration monitoring or anomaly detection. GE’s analytics integrates multiple data sources and gives deeper insight into how the whole system works, he said, giving the example of being able to analyze the implications of running a plant full-throttle to take advantage of economic dispatch. You can see both short-term implications—such as increased fuel burn and revenue from advantageous wholesale sales, for example—and long-term ones, including the consequences for equipment of operational stresses.
Asked about the market’s interest in the Digital Power Plant’s capabilities, Ayres said the customer base is global; GE is working, he said, with 60 different customers, from public power to independent power generators, to industrials, “because they see the market changing” and know they need an edge. In Europe, he said, “they need to get optimized” to respond to a changing grid with more variable renewables, for example.
Atwell added that the power industry is historically conservative and risk-averse. POWER asked about a newer sort of risk raised by a digitally connected power plant: cybersecurity. Ayres acknowledged that it is a concern but that GE has “a very solid suite of solutions,” including a “next-generation firewall” (through Wurldtech, see below). The company is doing cyber certifications with customers, he said; each environment and customer has its own cyber standards.
Social Media Sneak Preview
The announcement on September 29 was long anticipated by industry watchers (who could see signs of GE staff enthusiasm for the project if they were watching Twitter posts, see screenshot) and followed a series of other major corporate announcements.
GE Digital and the Industrial Internet
Among the personnel changes related to GE’s recent developments that are of most interest to the power sector were the promotion of Joe Mastrangelo, previously head of power conversion operations, to CEO of power generation. Russell Stokes will now lead GE’s Energy Management business as president and CEO, which, GE noted, “will become a $13B business when combined with Alstom.”
And, on Sept. 24, GE announced that Chief Technology Officer (CTO) Mark Little would close out his 37 years at the company and that Vic Abate, president and CEO of GE’s Power Generation business, would succeed him as CTO and head of Global Research. Of the latter change, a press release said, “This transition marks another chapter in GE’s transformation to become the world’s premiere Digital Industrial company.”
Earlier, on Sept. 14, GE had announced the formation of a new division, GE Digital, and named Bill Ruh as Chief Digital Officer. The new entity is to centralize all ”digital capabilities from across the company into one organization. GE Digital will integrate GE’s Software Center, the expertise of GE’s global IT and commercial software teams, and the industrial security strength of Wurldtech.”
The goal of GE Digital is to “make GE a digital show site and grow our software and analytics enterprise from $6B in 2015 to a top 10 software company by 2020,” said GE Chairman and CEO Jeffrey Immelt in the announcement.
Central to GE’s ambitions for the Industrial Internet is its Predix software platform, initially announced at the Minds + Machines conference two years ago. Predix, which is fundamentally asset performance management software, is described as enabling “asset and operations optimization by providing a standard way to run industrial-scale analytics and connect machines, data, and people. Deployed on machines, on premise, or in the cloud, Predix combines an industry-leading stack of technologies for distributed computing and big data analytics, asset management, machine-to-machine communication, and mobility.”
Physical and Digital Power Plants
POWER has published articles referring to the “digital power plant” for at least a decade, but what that designation means has changed over time. From digital control systems, to wired and wireless equipment monitoring systems, to remote condition monitoring, many power plants are digital to one degree or another. What GE means by “Digital Power Plant” is something more.
Of course, there remains a physical plant—whether powered by wind or natural gas—and GE will continue to supply equipment for those plants.
One indication of what GE means by the moniker came in May, when Tomas Kellner, the company’s managing editor, wrote a blog post titled “Wind in the Cloud? How the Digital Wind Farm Will Make Wind Power 20 Percent More Efficient.” The concept, he explained, consists of a physical turbine and a software twin (see image below)—a cloud-based computer model: a “modular, 2-megawatt wind turbine that can be easily customized for specific locations, and software that can monitor and optimize the wind farm as it generates electricity.” By optimizing both siting and operation, GE says the system would “create $100 million in extra value over the lifetime of a 100 megawatt farm.”
The traditional thermal power plants that provide the majority of electricity around the world would obviously generate far more data for the virtual plant.
Why Go Digital?
Immelt signaled the strategic pivot in 2012 when he started talking about the “industrial internet” and the company’s shift to becoming a software company.
As MIT Technology Review noted in May last year, “As recently as 2004, GE had reigned as the most valuable company on the planet. But these days, it’s not even the largest in America. Apple, Microsoft, and Google are all bigger. Software is king of the hill. And, as Immelt came to realize, GE is not that great at software.”
GE has predicted that the industrial internet “could add $10 to $15 trillion to global GDP in efficiency gains over the next two decades,” Kellner wrote.
The shift to digital has made GE a more-attractive company to work for as well. Being perceived by prospective new employees as an old-school industrial equipment manufacturer isn’t a good thing these days (just ask those in the thermal power generation industry), especially not when there is plenty of competition from disruptive new software-based companies like Uber as well as from software-plus-engineering trailblazers like Tesla. With its pivot to the software space, GE can offer new recruits not a “seat at the table” but a position at the new stand-up table—on wheels.
Other Recent GE Changes
The European Union approved GE’s acquisition of competitor Alstom’s power business earlier this month. Roughly a week later, on Sept. 15, GE announced that it was moving jobs in its turbine and generator business to Europe. The company said that it “will move approximately 500 jobs from Texas, South Carolina, Maine and New York to France, Hungary and China.”
The press release on the jobs move gave the absence of a U.S. export bank, and the associated export financing, as a reason for the decision. Authorization for the U.S. Export-Import Bank expired July 1, leaving the U.S. as the only major economy without an export bank.
Then, on Sept. 28, GE announced that it was also closing its gas engine manufacturing facility in Waukesha, Wisc., for the same reason—the absence of export financing. The GE Power & Water division will build a new US$265 million in Canada that the company says “will optimize efficiency and streamline production using data, analytics and software. The factory is expected to be completed in 20 months and will be a flexible production facility that can expand over time and also support manufacturing requirements for other GE businesses.”
GE said in the Sept. 28 release that it is currently bidding on $11 billion of projects “that require export financing” and that it has a long-standing relationship with Canada’s export credit agency, Export Development Canada.
—Gail Reitenbach, PhD, editor (@GailReit, @POWERmagazine)
[Updated 10/7/15 to add to Ayres title and correct instances of name misspelling.]