Utility Week

22 | 20TH - 26TH SEPTEMBER 2019 | UTILITY WEEK Operations & Assets Market view The Internet of Energy AI will be at the heart of the new age for the industry, says Dr Nazmiye Ozkan. T he Internet of Energy is coming, a host of disruptive technologies that will mean new business opportunities and competition for traditional generators and suppliers. At the heart of the new age for the industry will be artificial intelligence (AI): tools that can crunch and analyse the barrage of 'big data' from energy consumers on one side, and the growing range of sources of power and generation on the other; making sense of what is happening now, what might happen next and what decisions need to be made. The question is, does the industry have the senior managers able to see and take advantage of the new digital energy context, the insights from data, and make the most of collaboration with technology innovators? Within the next ten years there will be many more individuals, network groups and entire communities capable of generat- ing and sharing their own energy. In recent memory the UK had just four established TV channels and a small number of national newspapers, all of which are now just one part of a huge array of media, mainstream and specialist, providing all kinds of choice and diversity. The same will apply to energy. Transactions via blockchain will allow indi- viduals to 'sell' their own energy, harvested from solar panels, to friends in another part of the country – not just back to the grid. Manufacturers of cars and appliances such as washing machines and refrigerators will be able to sell their own energy as part of their deal: a guaranteed 10,000km from an electric car each year; five washing cycles a week. Market view Transparency is needed Energy purchasers are trying to balance cost and efficiency; the biggest barrier to this is a lack of transparency, says Dan Ibbetson. T he energy market is unrecognis- able from what it was a decade ago. A‹er years of very little change, we have been facing a period of profound transformation that has influenced every corner of the market. This change has been driven by a number of factors, such as the growing demand for lower-carbon solutions. With 196 countries signing the Paris Agreement in 2015, there is a global commitment to limit temperature rise to below 2C this century. As a huge contributor to emissions, the energy market has been under growing pressure to adapt to support global reduction targets. The move to renewable energy has also led to an increase in localised energy sources and microgrids. More customers are becoming independent from the grid, meaning the depend- ency on mass-scale power plants has fallen drastically. Underpinning all of this is the growing role of technology, which has further improved efficiency, as well as huge shi‹s in demographics as more people migrate to urban areas. With more variables to consider than ever before, decision-making has never been so challenging. Energy managers are facing the reality of having to strike a delicate balance between competing variables to meet a number of different priorities, such as cost and emissions targets. But the volume of information required to do so effectively is simply overwhelming. Power providers have an important role to play to equip energy purchas- ers with the information they need. To get a better sense of the priorities of decision-makers, we recently con- ducted a global survey. When compar- ing solutions, 50 per cent of those we spoke to said cost was the first thing they look at. However, the biggest bar- rier to better costing is transparency. What this adds up to is energy purchasers believing that they are not being given the information they need to make the best decisions – 48 per cent said their energy provider does not do enough to help improve the competitiveness of their business. As an industry, we need to stop approaching relationships with cus- tomers as a one-way transaction. Rather, these relationships should be seen as partnerships, and the industry should work alongside decision- makers to enable improved operating efficiency and performance. The industry benefits when the customer benefits. To equip our customers with the information they need, Aggreko has created a Cost of Electricity Calculator. All variables, such as fuel type, cli- mate, and time horizons, can be input into the calculator and then layered with the specific energy data to build a complete and unique picture of every project and the most efficient solutions. While we know that cost is a key priority, we also recognise the need to compare solutions based on other variables, such as emissions. Later this year, the calculator will be expanded to include emissions calculations. This calculator alone isn't going to solve an industry-wide, and indeed global problem about the lack of transparency around energy decision- making. But we do hope it kick-starts a wider conversation about the need to share the right information with decision-makers. With so much complexity in the market, decision-makers are unsur- prisingly overwhelmed as they try to compare solutions. The key to unlock- ing the potential is to establish trans- parent relationships. Only then will energy managers be able to make informed decisions to the benefit of their business. Dan Ibbetson, managing director, global products and technology, Aggreko

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