Gone are the days of energy being a mere commodity, when there was little thought to production, distribution or the power’s provenance. Climate change and rising power prices mean we are more aware of the way we generate and consume energy than ever before. The simple act of switching on a light has never impacted on our consciousness so much.
The vertically integrated energy utility companies of old are fragmenting. With the rise of renewable energy, distributed energy and micro-generation, their millions of former customers are becoming the new power producers.
How should industry navigate these changes? With pressure to cut carbon emissions yet drive production forwards, we’re at a crucial point in industrial energy consumption. Businesses simply can’t afford to ignore the cost of failing to invest in their energy strategy.
For those in energy-intensive industry, energy will always make up the bulk of their costs. Alongside industry taxes, this has a major impact on the bottom line. In some cases, up to 45 per cent of manufacturing costs of intensive-energy enterprises can be attributed to energy. Industry needs power to grow, but with costs expected to rise over the coming years, the challenges to businesses will become even greater.
Companies need cheaper, cleaner, more efficient ways to manage their energy. Just as technology has revolutionised other industry verticals, such as retail, gaming and finance, digital innovations could transform the energy industry. The next iterations of energy technology are about producing, using and selling energy in a smart, real-time, ultra-responsive way.
The approach of 5G networks and the internet of things (IoT) have the potential to pave the way for revolutionising energy use. The emergence of digitalised, interconnected individual assets could enable the sharing of unprecedented amounts of information. In the future, businesses could be in a position to capture vast amounts of data on their energy use; data which could then be analysed to make instant, automated adjustments to power consumption and deliver quick fixes to problems.
This data has the potential to be fed into smart grids, helping to smooth out peaks and troughs in power demand, and balance the load on the grid as a result. The IoT would enable energy use to be more accurately forecasted, both for users and for the grid at large, allowing for smart electricity tariffs and reduced bills.
As businesses and individuals increasingly create their own forms of power, from rooftop solar panels to on-site energy-from-waste facilities, we see the emergence of micro-grids to sell and share their energy. Blockchain technology may facilitate the growth of these localised networks by offering greater security, speed and transparency when trading power, and opening up energy trading and investment to a wider pool of participants.
The rise of electric vehicles, besides driving down carbon emissions, enables the introduction of portable power storage in the form of millions of battery packs on the roads. Industrial vehicles, from Uber cars to delivery vans, may provide options for power supply to the grid when required or charge from the grid to store energy when power is overproduced. Battery efficiency and capacity is evolving too, with graphene technology hoped to represent the next frontier of development.
According to Northern Gas and Power director Andrew Laird: “We stand on the edge of a period of significant change, heralding ideas and innovations that will completely transform the way energy is interacted with for future generations.
We know businesses are willing to evolve and adapt. People want to change their behaviour with energy. But access to technology which can enable this has been limited. The opportunity that technology presents, if embraced, could help drive global industry to great new heights.”
For more information on the future of energy please visit www.ngpltd.co.uk or call 0845 643 5432