Can IT help to unlock alternative energy sources?

In the ever-changing world of technology, the combination of IT with alternative energy sources has unlocked new means of energy optimisation

COMMENT, Business, Energy, IT

The world of energy is changing. From a centralised system discovered in 1888, energy is evolving into a decentralised system with diverse generation sources. There are two factors causing this transformation: the introduction of information technology (IT) in the energy sector, and the emergence of alternative energy-generation sources at scalable levels.

In the past 20 years, the internet has connected 2.5 billion people together, and in the next six years, this number will double. Concurrently, the internet will connect 40 billion machines to those five billion connected people.

The combination of IT with electrical devices and products provides customers with real-time information and smart services that allow all stakeholders an opportunity to implement active energy efficiency, share better energy, and consume at the right moment across smart grids.

From the shale gas boom in America to the rise of renewables in the energy mix, energy sources are widening and reaching scalability. Policy-driven markets have facilitated the deployment of technologies that are reaching grid-parity in many geographies.

This wider choice in energy-generation sources, combined with the emergence of information technologies in the energy sector, is redefining energy ecosystems on the demand and supply side, and paving opportunities of increased efficiency at all levels, thus ensuring complete optimisation of the supply chain.

For consumers, the connection of energy systems, phones, and machines in everyday life provides real-time information of consumers’ needs, and offers an opportunity to control their consumption.

It reduces consumers’ energy bill, and increases their purchasing power within a very short payback scale.

At the utilities and regional level, energy efficiency enables increasingly reliable supply and provides hedging against blackouts. It also saves investment cost by avoiding the creation of new plants.

Energy-efficient technologies also save significant amounts by increasing resilience and security, and anticipating extreme weather conditions.

At a country level, the implementation of higher energy-efficiency levels creates an economic opportunity for reduced public expenditure, as governments balance energy trades that are straining the economy.

Individuals are at the centre of this new energy world and their roles are redefined. Utilities must undoubtedly keep their central role in this evolution, and they are already rethinking the way they operate and address customers. Customers are changing in needs and behaviours, as well as their demands.

This transition needs solid change management to avoid over-production.

The evolution of technology, through software and the internet of things, is opening new means of optimising the overall energy chain through systems of integration. Such systems ensure that energy is safe, reliable, green, and efficient for the least amount of money.

Payback times are short, within a few years, and investments are refunded by savings. Market failures and resistance to change explain this untapped potential.

Governments should create environments to facilitate the implementation of energy efficiency and smart grids. They should enforce a level-playing field, and ensure that all the energy markets are free and competitive, notably by halting subsidies of fossil fuel technology.

Transitions can be long. But this one is worthwhile, and should be happening faster as it offers numerous benefits.

These desired changes include carbon emissions’ reduction, increased consumer purchasing power, job creation, country-wide balance of payments, and capital expenditure avoidance. It is time to power the people and unleash a new world of energy that is digital, local and consumer focussed.

Benoit Dubarle is the country president for Pakistan, the UAE, and Oman at Schneider Electric.

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