Digitalisation of electricity could unlock $3.1 trillion in industrial, societal value
Digitalization of electricity could unlock $3.1 trillion in industrial and societal value over the next decade. Its societal benefits stem from value creation for customers and a reduction emission, according to research from the World Economic Forum in collaboration with Accenture:
The research which was based on 2018 Top 10 Digital trends in Power and utilities says through digitalisation power and utility providers suddenly have the means to visualize their entire production and delivery chain electronically, enabling both improved business decisions and the ability to model and simulate scenarios of change.
“This important capability creates distinct advantages for early adopters, especially against the backdrop of increased use of renewable energy sources and more active consumer participation in the grid,” it stated.
Digitalization of electricity is part of a broader process of technological change, which – along with changes in regulatory and market design – is both driving and responding to the underlying trends in electricity demand and supply.
The report also explained that electricity network level optimization, from generation through transmission and distribution to customer management, is accelerating with the implementation of digital technologies. This will begin to change the competitive landscape of energy and will create additional value for the energy sector.
Driving these changes are the rapid deployment of sophisticated low-powered sensors, analytic capabilities tuned for energy, and big data platforms designed to manage massive amounts of industrial machine data. This transformation is enabling lower cost of operation, better asset management, refined insights for more profitable business decisions, and bidirectional interactions with prosumers.
2017 marked a year of tremendous transformation and disruption in the energy sector. The rapid rise of renewable energy, new innovations in battery storage, increased electric vehicles production, new grid models and interactive consumers signaled an era of accelerated change.
As these shifts are not likely to slow in 2018, General Electric (GE), one of the global players in the in the power and utilities sectors believes the following trends should be considered as power and utility executives carefully weigh their market positions and business models.
GE plans to work with another company, NYPA intends to explore the digitalization of every aspect of its operations, from its 16 generating facilities and 1,400 miles of electricity transmission network to the more than 1,000 public buildings it monitors throughout the state. NYPA’s goal is to use digital solutions to optimize its entire electricity value network, from generation to consumption, for reliability, affordability, and the lowest possible carbon footprint.
For Chicago-based energy company Exelon, which generates enough electricity to supply millions of customers in 48 states and parts of Canada, GE’s Predix software will also help Exelon balance electricity generation as the share of renewable energy grows. Energy grids need to maintain a delicate balance of supply and demand or risk shutting down.
The report says the continued penetration of green energy introduces opportunities to better balance supply and demand of electricity generation in a world where consumers demand renewable energy growth. “Predix applications will help Exelon predict demand and know when and to what extent to apply its diversified energy portfolio”.
In 2018 according to the research there will begin to be significant changes in energy contribution models and associated changes in grid configurations. Innovations will be launched to manage the underlying infrastructure, allowing multiple participants and interchanges.
GE currently is developing the next generation market platform, in partnership with PJM and ISO New England. With this proof of concept project, all participants in the energy value chain will have access to electricity market participants, micro services and advanced analytics for asset management and other functions, provided by the Predix platform.
With continued digitalization of the entire electricity network, new business opportunities will emerge as the fundamental topology of electricity interchanges begins to morph, allowing local markets, microgrids and the ability to accurately assess and manage demand on the grid. Power and utility companies that recognize and act on new routes to revenue offered by digital will be positioned for growth and success in 2018 and beyond.
Olusola Bello