Charting New Horizons: AI-Driven Utility Innovations
By Patrick Hodgson Sr., Director Enterprise Change Office – Infrastructure & Information Management, Pacific Gas and Electric Company
Introduction: “The power of data and analytics in the age of AI is akin to electricity in the industrial revolution—transformative and foundational.” – Ginni Rometty, Former Chairman and CEO of IBM
The maturity of a company’s data and analytics capabilities stands as one of the most influential factors determining its success in the adoption of Artificial Intelligence. When you encounter a robust data infrastructure capable of translating human interactions, operational processes, and customer behaviors into actionable insights, you’re witnessing a company poised for excellence in the marketplace. As Andrew Ng, a prominent figure in the field of AI, and co-founder of Google Brain, aptly put it, “AI is the new electricity.”
My career has granted me the privilege of spearheading large-scale enterprise solutions across the banking, healthcare, and utility sectors for the past two decades. I deeply appreciate the nuanced dynamics of each sector and the remarkable potential of data and analytics in forging a competitive edge. Having dedicated the last eight years to the utility industry, I can assert with absolute confidence that Artificial Intelligence possesses the transformative capacity to redefine the utility landscape. In the ensuing narrative, I aim to illustrate, through past achievements, present initiatives, and future prospects, the remarkable and revolutionary impacts of AI.
The potential for transformation within the Utility sector is vast, and as we continue to unlock groundbreaking opportunities, it is imperative that we maintain a commitment to inclusivity.
Past Achievements: “The era of artificial intelligence is upon us, and it’s reshaping industries and economies in profound ways.” – Sundar Pichai, CEO of Alphabet Inc.
In 2015, I was brought to Pacific Gas & Electric (PG&E), the fifth-largest utility in the U.S., to digitize their customer energy programs, marking one of the most gratifying experiences of my career. Each transaction represented not just data but tangible progress—solar implementations, wind turbines, Tesla Powerwall’s—all contributing to increasing California’s renewable energy footprint, thus reducing greenhouse gas emissions. By 2017, we had digitized 100% of the portfolio’s transactions.
Fast forward to 2018, and we faced a significant challenge: how to systematize the contracting, forecasting, and vendor management for this massive program portfolio. Fortunately, we had already digitized many of the vendor attributes using Salesforce.com. To address this challenge, we introduced an application called ‘Vendor Management Automation’ (VMA). By harnessing Einstein Analytics, we developed predictive measures to forecast vendor contract performance. For example, when a vendor committed to achieving specific energy reductions for a given year, our system tracked their progress. We automated payments and incentives based on their performance and contract terms. Additionally, we could proactively identify deviations and adjust contracts in real-time to meet portfolio objectives.
The impact was remarkable. We significantly reduced the expertise required to onboard new program managers, streamlined onboarding processes, and aligned vendor partnerships with our savings goals. Ultimately, this illustrates how artificial intelligence utilizes operational data to meet targets while reducing the human capital needed to manage a billion-dollar program portfolio.
Present Initiatives: “The success of an organization hinges on its culture. A positive workplace culture can elevate even modest solutions, while a negative culture can undermine the most powerful innovations.” – Richard Branson
Workplace culture is undeniably one of the cornerstones of any successful organization. Throughout my career in executing various technology implementations, I’ve witnessed firsthand how culture can be a decisive factor. I’ve seen organizations with thriving cultures elevate themselves, even with suboptimal solutions, while powerful solutions falter in the face of poor leadership and a dismal workplace atmosphere.
In the past two years, I’ve been fortunate to be part of an extraordinary cultural transformation. The notion of ‘workplace joy’ has transcended mere words and become a guiding purpose in my professional journey. With a workforce of 26,000 coworkers and numerous contract partners and vendors, our leadership team has made a resolute commitment: ‘It is enjoyable to work with and for PG&E!’ This declaration necessitates unwavering intentionality—an unwavering focus on encouraging every colleague to voice their thoughts, and for every leader to listen attentively and, most importantly, to act on those insights.
Our intentionality is evident in the wealth of quantitative and qualitative data we collect annually. Specifically, our annual all-coworker survey comments provide a treasure trove of insights, encompassing structured and unstructured dialogues numbering in the hundreds of thousands. Leveraging the power of machine learning and natural language processing, we’ve crafted a framework to identify the key drivers of workplace joy. For instance, one such element is the extent to which colleagues feel known for their contributions. Through AI-driven analysis, we’ve discovered that recognition is a pivotal component of feeling valued, leading to the evolution of multiple recognition programs throughout our organization, resulting in positive quantifiable outcomes.
The potency of AI lies in its capacity to amplify the voices of coworkers and translate their feedback into tangible actions. This impact becomes even more pronounced when we witness sustained quantitative improvements over time. In the dynamic landscape of utilities, coupled with a society and political arena marked by volatility, listening to the voices of our colleagues, and acting upon their insights has become paramount. AI emerges as a potent instrument in fostering a positive workplace culture where colleagues thrive, ultimately driving favorable business outcomes.
Future Prospects: “AI has the potential to bridge the gap between coworker satisfaction and customer satisfaction, creating a win-win scenario for businesses and their communities.” – Satya Nadella, CEO of Microsoft
At PG&E, our purpose is threefold: ‘Deliver for our hometowns,’ ‘Serve the planet,’ and ‘Lead with love.’ Every day, I strive to align my work with one of these profound statements. As I contemplate the future of the workstreams under my authority and the pivotal role AI will play, my focus intensifies on ‘Delivering for our hometowns.’
My vision is to harmonize the voices of our coworkers with the voices of our customers. I aim to validate a compelling hypothesis through AI: ‘Coworker Joy ↔ Customer Joy.’ In essence, when our coworkers experience joy, supported by the tools, resources, and encouragement they need to be their best selves, they inevitably deliver exceptional results for our customers.
We’re embarking on an exciting journey with the Microsoft AI Builder application, laying the foundation for sentiment analysis regardless of the source. We intend to classify sentiments as positive or negative and, crucially, assess their actionability. Furthermore, we’re constructing a language learning model to categorize sentiments into actionable and non-actionable themes. Imagine the potential when applied to a pool of unstructured sentiment data—picture a scenario where we can determine the positivity and actionability of messages, such as the entirety of an enterprise’s chat messages for the day.
This is a powerful use case, considering the various channels through which we communicate in the workplace. Of course, we recognize that privacy is of paramount importance in this endeavor. Additionally, we are committed to assembling a diverse team that reflects the rich tapestry of cultures within our communities and workforce.
The possibilities are boundless, and I’m genuinely thrilled to play a central role in driving positive change for the coworkers and customers I have the privilege to serve.
Conclusion: “As we embark on the AI journey, responsible governance and diversity in decision-making are the cornerstones of ethical and impactful innovation.” – Tim Cook, CEO of Apple Inc.
I consider it an honor to serve on an AI committee within my organization, entrusted with the vital mission of establishing comprehensive governance for AI applications. We are currently forging strategic partnerships with leading industry experts, committed to the responsible and ethical use of AI while safeguarding the data entrusted to us.
While the use cases I’ve highlighted are impressive, our AI initiatives extend even further, encompassing cutting-edge technologies like image analysis and drones. The potential for transformation within the Utility sector is vast, and as we continue to unlock groundbreaking opportunities, it is imperative that we maintain a commitment to inclusivity. Diverse perspectives at the decision-making table are crucial, ensuring the safety and security of our coworkers, the customers we serve, and our valued partners’ data.
Executive Bio
Patrick Hodgson is Director of Information & Infrastructure for Pacific Gas and Electric Co. (PG&E) Enterprise Change Office. PG&E is an investor-owned electric utility serving more than five million households in northern California. In this role, Patrick is responsible for delivering end to end support for PG&E’s True North Strategy via our proprietary change standard. In his previous role as Enterprise Architect, Patrick implemented a technology portfolio consisting of $30M in IT spend for Customer Energy Programs whose sole mission is to reduce carbon emissions in the state of California and enable renewable opportunities in disadvantaged communities across the state of California. Previous, he also led Business Operations for Customer Energy Solutions, Directing a 100+ member team and a multimillion-dollar annual budget. He oversaw six energy savings business units and customer-facing processes and technology supporting the management of more than $500 million in energy efficiency rebates and discounts for 15 million B2B and B2C customers. Patrick also served as the President of PG&E’s Black Employee Resource Group (ERG) from 2020 to 2022. He was awarded the “Above and Beyond Leadership Award” by Diversity Best Practices for his leadership in diversity in 2021.
Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest combined natural gas and electric utilities in the United States. Based in San Francisco, with more than 22,000 employees, the company delivers some of the nation’s cleanest energy to 16 million people in
Northern and Central California.