Updated: Jun 13, 2020
Although not yet widely implemented, it is quickly becoming apparent that significant opportunities exist for the use of robotic process automation (RPA) in energy trading to reduce costs and improve organizational effectiveness. RPA involves the leveraging of digital techniques that can perform simple and repetitive clerical activities, such as data entry, purchase order issuance and the submission of compliance forms. Given the extensive volume of information processed in energy trading operations, RPA thus offers the potential for significantly reducing errors and costs across the entire enterprise, but especially in back-office functions.
The “bots” of robotic process automation
At the heart of RPA are robots — but digital ones instead of physical ones. In RPA, “bots” are introduced into existing software applications in order to capture, interpret and process information that is currently manipulated in well-defined tasks by human workers. These bots interface with a company’s information systems in ways that mimic a clerk: logging in, accumulating specific pieces of data, processing it using structured rules, sending the resulting work to another destination and then logging out.
The benefits of RPA are especially important for companies relying on legacy software applications, many of which cannot be configured to coordinate well with other applications, in large part because trained support is no longer offered for the programs. Oftentimes in these situations, users are required to manually migrate information from one application to another, which is time-consuming, error-prone and hence costly. RPA can automate such transfers.
To illustrate the value-creation potential of RPA, the London School of Economics and Political Science produced a case study profiling RPA adoption at a large European utility. At this utility, bots have automated about 25 back-office processes relating to “meter management, customer billing, account management, consumption management, segmentation and exception processing.” About 300 bots (under the supervision of two employees) have replaced a staff of about 600 in processing about 1 million transactions each month. Against the costs of implementation, the RPA initiative achieved a payback of initial investment within 12 months, and produces an annual ROI of about 200 percent.
As stated by the Institute for Robotic Process Automation and Artificial Intelligence, “any company that uses labor on a large scale for general knowledge process work, where people are performing high-volume, highly transactional process functions, will boost their capabilities and save money and time with robotic process automation software.”