Disruptions in the energy market are taking place with increased frequency. These changes have been dramatic over the last seven years. In the past we have thought of these changes as ‘modernisation’, or ‘transformation’, but with the changes accelerating, ‘disruption’ is a more suitable way to describe what we are experiencing. And it is not expected to slow down in 2016 and beyond.
With a better understanding of the complexity involved in the transformation of the electricity industry the words ‘smart or future energy’ are becoming more prominent. BuddeComm believes that the term ‘smart grids’ is too narrow and that ‘smart energy’ is better suited – especially once the communications developments in national mobile and fixed broadband networks start to converge with smart grid developments. Smart grids unfortunately have become synonymous with smart meters, again leading to too narrow a view on this market.
Smart energy signifies a system that is more integrated and scalable, and which extends through the distribution system – from businesses and homes and back to the sources of energy. Developments at the edge of the network will increasingly determine its future direction. A smarter energy system has sensors and controls embedded into its fabric. Because it is interconnected there is a two-way flow of information and energy across the network, including information on pricing. In addition to this it is intelligent, making use of proactive analytics and automation to transform data into insights and to efficiently manage resources.
This links with the telecoms development known as M2M or the ‘internet of things’ (IoT). For this to happen various functional areas within the energy ecosystem must be engaged – consumers; business customers; energy providers; regulators; the utility’s own operations; smart meters; grid operations; work and asset management; communications; and the integration of distributed resources.
With energy consumption expected to grow worldwide by more than 40% over the next 25 years demand in some parts of the world could exceed 100% in that time. This will produce an increase in competition for resources, resulting in higher costs. In an environment like this energy efficiency will become even more important.
Quite apart from any increased demand for energy in specific markets, the move to more sustainable technologies – for example, electric vehicles and distributed and renewable generation – will add even more complexity to operations within the energy sector. As was again confirmed at the COP21 in Paris, technological innovations will have to play a larger role in climate change adaptation.
Concerns about issues such as energy security, environmental sustainability, and economic competitiveness are triggering a shift in energy policy, technology and consumer focus. This, in turn, is making it necessary to move on from the traditional energy business model. Renewable energy, linked to distributed energy systems and battery storage, is going to be the game-changer here.
As a consequence electricity utilities could end up in a ‘spiral of death’ situation similar to that of the companies that invested in the building of the internet infrastructure – they may own the means of delivering electricity and associated services, but may not be able to take advantage of the new business opportunities that will arise. This will limit their opportunities for future growth. Instead companies should develop a ‘vortex of opportunities’.
Another problem will surface when, due to users reducing consumption and producing energy themselves through energy efficiency strategies, the traditional pricing models become inadequate in terms of maintaining the energy infrastructure.
The potential for transformation of the energy industry to smart energy is still at a very early stage. Valuable advances have already been made in some areas but consensus needs to be reached regarding a collective approach to interoperability and technical standards.
Smart cities, smart communities, smart buildings, connected communities, M2M, drones, IoT, big data, data centres, cloud computing, smart grids, broadband, smart meters, smart homes, EV, PV, batteries, storage, 4G, 5G.
NEM, NBN, AGL, Google
Table of Contents
Number of pages 61
Last updated 21 Mar 2017
Analyst: Phil Harpur
As you know, I have resigned from the Labor Ministry and have decided not to re-contest the seat of Charlton at the next election – both for personal reasons.
Before leaving Parliament, I particularly wish to record my thanks to you for your generous and constructive participation in the deliberations that generated significant economic policy reforms for the Australian community. Continuous economic transformation is a key challenge that faces all Governments.
The development of sound public policy should always be contestable. Ultimately, good and equitable outcomes are not concessions to any particular interest group, but the careful balancing of interests to create the greatest possible benefit for the nation. You have contributed to that, and I sincerely thank you for it.
Greg Combet, Former Minister for Climate Change, Industry and Innovation
Finland - Telecoms, Mobile and Broadband - Statistics and Analyses
US$575.00 until 24 Apr 2019
(normal price US$1,150.00)
Slovenia - Telecoms, Mobile and Broadband - Statistics and Analyses
US$575.00 until 24 Apr 2019
(normal price US$1,150.00)
A selection of downloadable samples from our Annual Publications catalogue.