SAP for Utilities

Overview

Raphael Silva
Advisory Senior Associate – PwC Calgary
April, 2009
Objectives

- At the end of this presentation, you will be able to:

• Understand SAP for Utilities definitions and components
• Identify integrations between the Solution and other SAP and non-
SAP Systems
• Review key aspects during the implementation
• Understand how a system can help reduce operational loss.

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Agenda

- Introduction to SAP IS-U/CCS

• Definitions
• Modules
• Integrations
- Key aspects to consider during implementation
- Operational Loss
- Q&A

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Introduction to SAP IS-U/CCS
Definitions

SAP Industry Solution for Utilities companies

- Customer Care System
- Initially, an Add-on industry solution (last version 4.72)
- Included in mySAP ERP Edition 2005 (ERP 6.0), as an Industry
Extension activated via SAP Switch Framework.

• Activity Sectors
- Electricity, Gas, Water, Sewer, Cable TV
• Capability to create new activity sectors
• One company -> One or More activity sectors
- Residential and Non-Residential clients
- Regulated and Deregulated markets

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Introduction to SAP IS-U/CCS
Definitions

IS-U/CCS as part of ERP 6.0

SAP ERP 6.0

Industry Extensions Enterprise Extensions

Oil&Gas Utilities Telecom JVA Banking
Healthcare Etc… FERC Etc..

SAP ERP Core

Financials Human Resources
Logistics Cross-Applications

SAP Netweaver Platform

Basis Application Server

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Introduction to SAP IS-U/CCS
Integrations

IS-U/CCS as a component in the ERP solution

Enterprise Management and Business Support

IM, CO, FI, EC, MM, HR, SD, TR, …

Core Processes

PS, PM, SM, SD, IS-U/CCS, Work Management

Specialized Solutions
GIS, SCADA, Internet, etc..

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Introduction to SAP IS-U/CCS
Definitions

Functional Scope
Client
Services
Generation Transmission Distribution
Billing

Contact/Information/Customer Service
IS-U
/CCS

Consumption Contract Contract

PM/ Entry Billing Invoicing Accounts
Marketing
PS & Payable
&
Sales Installation Billing Printing &
Services Services Receivable
SD

Device and Meter Reading Management

FI

Human Resources Management

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Introduction to SAP IS-U/CCS
Modules

IS-U/CCS Modules
- Front Office / Costumer Contact
- EDM – Energy Device Management
• Device Management
• Meter Reading
• Energy Data Repository
• Settlement
- Contract Billing
- Invoicing
- Contract Accounts Receivable and Payable (FI-CA)
- Asset and Work Management
- Intercompany Data Exchange

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Introduction to SAP IS-U/CCS
Modules

Front Office / Customer Contact

Contract
Asset and Invoicing Accounts
Contract
Work & Payable
Billing
Management Printing &
Receivable

Device and Meter Reading Management

Intercompany Data Exchange

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Introduction to SAP IS-U/CCS
Modules

Front Office / Customer Contact

- Front Office supports all business processes

- Records all types of contacts between the customer and the utility
company
• In-Person, Internet, Fax, Letter, Phone, e-mail
- Customer contacts can be created
• Automatically: as part of internal processes (move-in, move-out, etc.)
• Manually: complaints or inquires
- Possibility to define classes and activities according to the client
- Can be analyzed using standard reports
- Not a CRM system (no campaign management, no market analysis, no
field service sales, etc…)

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Introduction to SAP IS-U/CCS
Modules

Device and Meter Reading Management

- Key functional area

• Manages meter and device data
• Supports entry and management of meter reading results and
consumption data
- Device Management
• Record information for billing, technical installations and
inspections and certifications
• Integrate with PM and MM
- Meter Reading
• Street Routing and Periodic/Non-Periodic Orders
- Energy Data Repository
- Settlement – interconnection between distributors and suppliers

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Introduction to SAP IS-U/CCS
Modules

- Map all technical object

- Improve maintenance work
- Check the total cost of installations
• From purchase through refurbishment, to
Asset and
maintenance
Work
Management - Offer customer oriented services, schedules
services
• Post services in bills
- Integrate with external systems
• GIS and NIS

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Introduction to SAP IS-U/CCS
Modules

- Central component of IS-U solution.

- Basic Functions
• Residential and non-residential clients with
user-defined periods
• Flexible billing cycles with simulations
Contract
Billing • Cross-contract billing with plausibility
checking
• Parallel processing and monitoring for mass
run

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Introduction to SAP IS-U/CCS
Modules

- Processes bills from different sources

• mySAP Utilities solution
• mySAP SD component (installations
and sales)
Invoicing • External billing systems
& - Post documents to FI-CA
Printing
- Creates print documents and print bills
- Supports reversals processes
- Manages budget billing plans
- Supports determination and collection of
taxes, charges and duties

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Introduction to SAP IS-U/CCS
Modules

- New component: sub ledger accounting

designed to the industry sectors
• Parallel and Mass processing
• Relevant objects: Business Partner,
Contract
Contract Accounts, IS-U contracts
Accounts - Key Functions
Payable
&
• Several payment methods
Receivable • Control Clearing of an Open Document
• Dunning for due open items
• Interest calculation and Business Partner
evaluation
• FI-CA documents are summarized
before transferred to GL
• Postings and Reversals / Closing
activities
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Introduction to SAP IS-U/CCS
Modules

Intercompany Data Exchange

- Used in deregulated energy markets

• Customers are free to switch utilities suppliers
- Administration of deregulation data
• Points of delivery, Grids, Services and Service Providers
- Processing of data exchange processes
• Allows to exchange data necessary for business process in
deregulated market

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Introduction to SAP IS-U/CCS
Integrations

Integration with other SAP and non-SAP Solutions (one example)

Specialized
SpecializedSoftwares
Softwares
SAP CTI
GIS,
GIS, SCADA,
SCADA, …
… SAP Mobile
Mobile CTI

SAP
SAP ERP
ERP 6.0
6.0 SAP
SAP CRM
CRM
ERP,
ERP, IS-U/CCS,…
IS-U/CCS,…

SAP
SAP BI
BI

SAP
SAP Portal
Portal

SAP Netweaver (XI)

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Key aspects to consider during implementation
Lessons Learned
Typical Timeline

In IS-U/CCS implementations we usually have:

- 2 Go-Lives
• First go-live as “pilot implementation” for a small area and non-
residential customers
• Second go-live for all residential customers, at least 4 months
later
- 2 months support after go-live (minimum)
• 1st month: migration data
• 2nd month: new data

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Lessons Learned
Roles and Responsibilities

Organizational Structure
Steering Committee

Project Director

Process Manager PMO

Project Manager

Integration

CCS/CRM Functional Change Management Technology BI

CRM Billing, Invoice, Basis ABAP Infrastructure

CS FI-CA

WM
Data Migration
EDM Page 20
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Reminders during the project

- Keep track on the integration during the project phases

- Flexibility to change project organizational structure between go-
lives
- Scope control – mainly after 1st go-live
- Performance should be considered since the design phase
- Data migration, security profiles, archiving and reports should be
addressed by functional teams since the design phase
- Leverage the use of standard SAP
- Test, Test, Test (Data Migration, Stress Test, Batch Test, Unified,
Integrated)
- Revise hardware sizing during the project
- Communication and training are crucial

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Operational Loss
What can be considered as operational loss?

• Generic denomination
• Energy bought – Energy charged
• Where is the difference
- Reduce in Accounts Receivable
- Network improvement
- Illegal Connections

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Facts - Brazil

Charged

Demand In 2008, the

percentage of
loss was
reduced by
almost 3%, in
GWh
Loss
>20%

Source: Light – Electricity Distribution Company for the city of

Rio de Janeiro – 2007 and 2008 Results Report - www.light.com.
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Facts - Canada

Loss
<10%

Source: CIA website – www.cia.gov

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How to reduce Loss?

Reduce in Accounts Receivable

•Improve controls
•Increase methods of payments
•Keep close contact with clients

With SAP
•One client has one contract account and multiple contracts
•Multiple methods of payments
•EDI with banks to process receivables
•CRM tools

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How to reduce Loss?

Network Improvement
Operational Tasks
• Improve meter reading
• Improve disconnection/reconnection management
• New devices

With SAP
• Every service requires a meter reading
• Reduce lag between physical and system disconnection/reconnection
• Data clean-up and migration tests prior to go-live

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Illegal Connections

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Source: www.oglobo.com.br; www.ceee.com.br;
Illegal Connections

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Source: www.oglobo.com.br; www.ceee.com.br;
Illegal Connections

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Source: www.oglobo.com.br; www.ceee.com.br;
Illegal Connections

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Source: www.oglobo.com.br; www.ceee.com.br;
How to reduce Loss

Illegal Connections
• Education campaigns
• Off-site meter reading
- Risk Areas (high crime rates)
• Reduce # of self-reconnections

• With SAP
• Identify patterns of consumption, using Business Intelligence
• Develop X-module tool to support campaign
• Improve disconnection/reconnection management

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Wrap-up

- Introduction to SAP IS-U/CCS

- Key aspects to consider during implementation
- Operational Losses
- Q&A

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Contact

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