The “Energy Internet”: Startups are bringing a new energy network to life
The United States wastes enough energy every year to power the UK for seven years. While there has been plenty of focus on the need to transition to an economy powered by renewable energy sources, rather than fossil fuels, the structural waste issues within the system itself should not be ignored. Indeed, a transition to a more effective way of delivering energy is almost as important as the energy source itself.
Incumbent large-scale, centralised energy production, controlled by a few main suppliers is reaching its limitations and is unlikely to be fit for purpose in the long-term. Building the power plants needed to meet the extra demand predicted to emerge by 2050 is unlikely to be economically feasible even before considering the negative consequences on the environment.
A number of energy trends suggest an alternative way forward. Renewables are becoming increasingly economically viable and provide an energy marketplace that is ripe for technological innovations. The potential of distributed energy is being explored in trial micro grids, for example LO3 Energy in Brooklyn, while machine learning and AI could potentially pave the way for intelligent systems.
Individually, these trends are unlikely to disrupt the lock-in of the current energy landscape, but promising innovations in software that can utilise data from solar energy systems, smart thermostats, battery storage systems and other distributed energy resources (DERs) will be critical for transitioning to an alternative system – the “Energy Internet” — powered by renewables, distributed in production and ultimately more effective and efficient in terms of not wasting what is produced.
It’s an opportunity that is being exploited by innovative startups, like Californian-based AutoGrid, who provide an: “Integrated suite of flexibility management software applications that allow utilities, electricity retailers and renewable energy project developers and energy service providers to deliver cheap, clean and reliable energy by managing networked DERs in real time and at scale”. In fact, AutoGrid believes its applications deliver such significant benefits that flexibility management will prove to be the “killer app” of the Energy Internet.
Data has long been viewed as a way of optimising effective energy use within buildings. The U.S. Environmental Protection Agency (EPA) estimates that more than 30% of all energy used inside buildings is wasted through lighting, heating and cooling empty rooms. Intelligent, data-enabled software systems, combined with sensors can help to control energy use more effectively, while similar systems can be used to make energy use by current utility providers more efficient.
However, the opportunities are arguably even greater when it comes to integrating renewable and other distributed energy resources into these types of systems. According to Bloomberg New Energy Finance (BNEF) wind power is the cheapest form of electricity to produce in Germany and the UK, while costs of solar are predicted to decrease by 25-50% by 2025. “However, while costs for renewable energy keep dropping, their intermittent nature can prove challenging for utilities, who must keep the grid’s energy supply and consumption in constant balance”, Amit Narayan, CEO of AutoGrid told Circulate. “This is what makes the software developed by AutoGrid important – it enables utilities and electricity retailers to harness the petabytes of data streaming from solar panels, wind farms, EVs, and millions of other connected energy resources so that they can predict and optimise across their energy networks in real time and at scale”.
The potential for Internet of Things (IoT) technologies to enable an energy system consistent with the principles of a circular economy was explored in-depth, including case studies, as part of the Ellen MacArthur Foundation’s Intelligent Assets report. Clearly, finding a harmony between developing energy provision that is effective and works for businesses and people, and the controlled and efficient production is critical.
Worldwide installed capacity of distributed energy systems is predicted to more than double in the next decade, according to the latest research from Navigant. A different kind of energy system is well under-development; Narayan argues that this new paradigm requires three main features:
– Self-learning, with the intelligence to continuously improve DER forecasting and optimization to cope with rapidly changing circumstances and conditions.
– Sophisticated and modern big data technologies will need to be employed effectively so that the system can be managed and optimised in real time, at scale with thousands of DERs and millions of customers.
– Modularity will be essential, allowing the different kinds of resources to be dealt with individually, and also so that new resources and devices can be added into the network.
Energy production enabled by smart data may not be far away, and there are at least positive signs that it could be a direction that allows for a more effective, less wasteful and cheaper system, as Narayan puts it, “data has the potential to help us to power wisely and proactively”.