Arvato-Systems-Mako-BTR-Stage_shutterstock_699788977

Digitization of the Energy Industry

From energy supplier to smart city architect

From Energy Supplier to Smart City Architect: Digitalization as a Driver of Decarbonization
06.01.2026
Cloud
Digital Transformation
Utilities
Artificial Intelligence
ArvatoSystems_Utilities_IT-Plattformen_AdobeStock_178510899

Today, more than 56% of the world's nearly 8 billion people live in cities - and the trend is rising. Digitizing urban living spaces consistently and thus decarbonizing them would have far-reaching effects. However, smart cities can only become a reality if decentralized energy generation and consumption in all sectors can be made transparent and intelligently controlled through far-reaching digitization.

Challenges for the Energy and Utilities Sector

Digitalization, new business models and the resulting increase in data volumes are irreversibly changing the energy industry. IT systems will therefore have to become radically more flexible in the future to allow companies maximum agility and cost efficiency. Two elementary conditions must also be met when digitizing smart cities. Firstly, the systems used must be able to process very large volumes of data. Secondly, the systems will have to process different types of data, which also come from a wide variety of data sources and arrive via different communication channels.

However, with growing digitalization, increasing data volumes and the increasing networking of critical infrastructures, other aspects are becoming massively more important: IT sovereignty and cyber security. Critical infrastructures such as the energy supply must not only be efficient, but also resilient to external attacks and technological dependencies. As a result, aspects such as the use of certified security architectures, encrypted data communication and sovereign cloud infrastructures are increasingly becoming the focus of the digital transformation of the energy industry.

Example of Power Consumption Measurement

The Rollout of intelligent measuring systems (iMSys). Instead of meter readings once a year, modern iMSys now continuously record high-resolution consumption and feed-in data - over 35,000 quarter-hourly values per year and meter. This database opens up new possibilities for transparency, efficiency and automated control. In future, millions of these systems will be installed not only on the consumer side, but also in decentralized generation plants. This will fundamentally change the role of energy consumers: passive consumers will become active "flexumers" - i.e. flexible consumers and producers - who flexibly adapt their energy consumption to supply and price, shift loads and actively contribute to grid stability. The digitalization of metering infrastructure is also progressing in other supply sectors - such as heating, water and gas - and is enabling in-depth consumption analyses and new data-based business models.

 

The experience gained with smart metering systems - particularly in the secure handling of high-frequency, sensitive data - can be transferred to numerous other data-driven fields of application in urban areas. Examples of such smart city scenarios include:

Intelligent charging station and parking space management
Air quality monitoring
Condition monitoring of systems
Fill level monitoring of waste and residual waste containers
Traffic flow management
Leakage monitoring
Building monitoring
Submetering

The data to be processed in the energy industry comes from legally regulated energy industry processes on the one hand and from the dynamically growing world of the Internet of Things (IoT) on the other. In addition to traditional backend systems, new integration points such as LoRaWAN infrastructures, edge devices, submetering systems and urban data platforms are becoming increasingly important. The ability to network these heterogeneous data sources securely, interoperably and in real time is crucial. The Smart Meter Gateway (SMGw) plays a key role in this architecture. It connects the highly regulated world of the energy industry with open IoT ecosystems - and thus becomes a central enabler of secure smart city applications. It not only ensures the data protection-compliant connection of measurement and control data to energy industry systems, but also acts as a trustworthy bridge between critical infrastructure and open IoT environments. Particularly in the context of smart cities, the SMGw thus becomes a central building block for secure, scalable and resilient data architectures. The intelligent networking of these systems creates the basis for greater transparency, efficiency and new added value in the energy sector.

Digitalization, Integration and Transparency Create Efficiency and Added Value

stock-photo-ai-artificial-intelligence-concept-woman-profile-and-smart-city-mixed-media-719244976

The digitalization of the energy industry and smart cities generates huge amounts of data from a wide variety of sources - from smart metering systems and IoT sensors to urban data platforms. However, the decisive lever lies not in the mere availability of this data, but in its end-to-end integration and intelligent use.

Powerful IT and data platforms create the prerequisites for securely networking and consolidating heterogeneous data sources and making them available in real time. The Enterprise Application Integration (EAI): It connects backend systems, databases, workflows and specialist applications along the entire energy industry value chain and thus creates the necessary transparency about energy flows, plant statuses and emissions.

On this integrated database Artificial intelligence to its full potential. AI-supported analyses recognize patterns, create forecasts and generate automated control impulses - for example to optimize network loads, energy flows, traffic flows, the utilization of charging infrastructure or the demand-oriented control of urban services. This means that data is not only analyzed, but actively translated into operational and strategic decisions

This creates new efficiency potential and data-based business models for energy supply companies and municipal players. Platform solutions make energy consumption and CO₂ emissions transparent, support targeted sustainability management and enable the derivation of specific optimization measures - from consumption analysis to automated control.

Cloud-based deployment models, open interfaces and a high level of integration capability also reduce the burden on the organization. They reduce complexity, accelerate implementation times and help to cushion the increasing shortage of skilled workers - a decisive factor for the successful digital transformation of the energy industry.

Energy and Utility Companies in Pole Position

The energy and supply industry is at the center of change. Topics such as the management of electromobility, the construction and operation of virtual power plants, energy plant management for customers and submetering are close to the company's own value creation processes - it therefore makes a lot of sense to actively engage in these fields. In addition, supply companies need new business models and the resulting sources of revenue in order to counter the increasing pressure on margins in traditional energy sales. In this context, many energy suppliers are also approaching topics that are realized through IoT-based technologies - such as intelligent charging infrastructure, smart building automation or data-driven environmental and traffic control. This opens up new opportunities for energy suppliers to position themselves as municipal service providers that not only supply energy, but also provide digital services for cities and municipalities - from the provision of urban data platforms and the integration of sensor technology to support in the implementation of municipal sustainability and digitalization strategies.

Conclusion

The decarbonization of urban areas is, without a consistent Digitalization of the energy industry not to be achieved. Data integration, transparency and intelligent control form the basis for making energy flows and urban infrastructures efficient, resilient and sustainable.

Energy supply companies are developing into central shapers of the smart city. To successfully fulfill this role, they need powerful, secure and integrated digital platforms. Solutions from Arvato Systems - such as green.screen for energy, plant and sustainability management - create the technological basis for this and effectively combine digitalization and decarbonization.

This creates networked, data-based services that increase efficiency and sustainability while measurably improving the quality of life in cities and municipalities.

Written by

Photo-Stefan Wieberneit
Stefan Wieberneit
Expert in sustainability & energy management

Stefan Wieberneit is Head of Business Development Utility at Arvato Systems. With over 20 years of experience in the energy and utilities industry, he designs digital innovations for the sector. He brings with him in-depth expertise in IT product development, smart metering, and ESG management.

Learn more about this author