Dig­i­tal­iza­tion in the ener­gy indus­try — Report

The ener­gy indus­try is in a phase of dras­tic change. To become car­bon-neu­tral by 2050, the ener­gy sec­tor will need to under­go a mas­sive trans­for­ma­tion, switch­ing to more sus­tain­able renew­able ener­gy sources and dri­ving elec­tri­fi­ca­tion. In addi­tion to the need to decar­bonise, the indus­try is also becom­ing increas­ing­ly decen­tralised as a greater num­ber of dif­fer­ent ener­gy sources inter­act, bi-direc­tion­al pow­er flows become stan­dard and renew­able ener­gy is gen­er­at­ed clos­er to where it is used.

gridX has tak­en a close look at this top­ic and pub­lished a com­pre­hen­sive dig­i­tal­i­sa­tion report.

Dig­i­tal tools for rescue

Change with­in the indus­try has led to new busi­ness mod­els and chang­ing roles as new and uncon­ven­tion­al play­ers enter the mar­ket. Increased volatil­i­ty caused by the Covid 19 pan­dem­ic and the increased use of renew­ables means that play­ers need to get smarter about the elec­tric­i­ty sup­ply chain. The ener­gy sec­tor is far behind oth­er indus­tries when it comes to dig­i­tal inno­va­tion, and rapid accel­er­a­tion is now the only way for­ward. Rather than act­ing as anoth­er force putting pres­sure on the indus­try, dig­i­tal­i­sa­tion in the ener­gy sec­tor should be seen as a solu­tion to add val­ue and increase effi­cien­cy and demand response of ener­gy sys­tems. A vari­ety of tech­nolo­gies will con­tribute to the increas­ing dig­i­tal­iza­tion in the ener­gy sector.

Improve cost efficiency

Dig­i­tal con­trol opti­mizes grids to max­i­mize renew­able ener­gy sup­ply, reduce demand when elec­tric­i­ty is most expen­sive and car­bon-inten­sive, and there­by improve cost effi­cien­cy and resilience. For exam­ple, ener­gy and util­i­ties com­pa­nies with an advanced lev­el of dig­i­ti­za­tion have seen, on aver­age, a 10% improve­ment in net ben­e­fits (rev­enues minus costs).

gridX’s XENON plat­form, which con­nects and con­trols ener­gy flows and enables real-time analy­sis of mil­lions of data points, has enabled numer­ous com­pa­nies to reduce costs and emis­sions enor­mous­ly. By imple­ment­ing AI-based dynam­ic load man­age­ment sys­tems, for exam­ple, E.ON could expand elec­tric vehi­cle capac­i­ty from 49 to as many as 550-with­out expand­ing the grid.

Holis­tic sys­tem transformation

Rather than imple­ment­ing an iso­lat­ed dig­i­tal solu­tion and expect­ing ongo­ing ben­e­fits, com­pa­nies need to trans­form the entire sys­tem to build dig­i­tal exper­tise and stay abreast of con­stant­ly emerg­ing tech­no­log­i­cal advances. Stake­hold­ers need to under­stand the impor­tance of invest­ing in dig­i­tal­i­sa­tion and embed it as a strate­gic pri­or­i­ty. Chal­lenges around secu­ri­ty, pri­va­cy and reg­u­la­tion must also nat­u­ral­ly become impor­tant con­sid­er­a­tions in this long-term approach.