An Integrated View of the Future of Energy
Updated: Mar 15, 2021
Energy as a lifeblood of the modern economy
Calling energy as the lifeblood of the modern economy won’t be an overstatement because if we glance at post-industrial revolution history then we would know that delivery of reliable energy is fundamental to the economic growth of the world.
Why am I passionate about working on energy transition problem?
The reason I am very passionate about working in energy industry because I am very certain that this is the most exciting time to be a part of energy industry as energy industry is going through significant transformation and disruption that requires creativity, persistence, and energy.
In addition to that, I also find energy transition problem very interesting and challenging from engineering point of view.
Why Energy System Needs to Transform?
The critical infrastructure that is designed and developed to deliver this energy from production to demand centres is called energy system.
Till today, most of the energy used for heating, cooling, lighting, mobility and other energy services come from burning fossil fuels and burning of coal, oil and gas has been inextricably linked to the rising levels of greenhouse gases in Earth’s atmosphere and is a leading contributor of climate change.
Therefore, in order to mitigate global climate change and other environmental impacts related to energy we need to implement a shift in where we get our energy from and the way we consume it which I would say that is one of the grand challenges facing our planet today.
The world’s scientists agree that we are on a path towards disaster that can only be stopped by weaning ourselves off our fossil fuel habit. But that leaves us with a problem. How do we ensure the lights stay on?
How Energy System would Transform?
Transition to sustainable energy is more than just switch off one technology or switch off some types of fuels rather it requires necessary changes in structures, behaviors, laws, and market instruments.
Therefore, It is clear that successfull transition to a sustainable energy future, will not be without problems and challenges. Numerous questions demand an answer. In my opinion, transition to a sustainable energy future requires holistic approach to innovation. It requires to look at a system with all its components, and at all the actors with roles that are necessary to enable large scale use of clean energy.
I think solving energy problem is like solving a jigsaw puzzle there are many areas and fronts (i.e generation, transmission, distribution, consumption and storage etc. ) that needs to be addressed in order to realize a climate-resilient energy future and only when all of these solutions are integrated and fit together then we can have a climate-resilient energy future.
Energy Demand Reduction and Energy Efficiency
First things first, even before we talk about the decarbonization of energy, we really need to make sure that we must always begin with the aim to reduce energy demand or find most efficient way of meeting that energy demand. As they say that the most sustainable energy is the energy we dont consume.
Because energy demand reduction and energy efficiency can help us to cope with the immediate hike in energy demands expected in the coming decades especially from developing regions become more industrialized like Asia, Latin America and parts of Africa. Therefore, even minor improvements in the energy efficiency can reduce global energy intensity in coming decades.
Decarbonisation of all forms of Energy
Needless to say, we need to find carbon neutral ways to meet our growing energy needs.
The good news is that renewables energy technologies are already mature (solar PV, onshore wind, offshore wind etc.) and can help us decarbonize our energy system. Because renewable energy generation technologies such as wind and solar have already gained a foothold in the energy market and are already in a position to knock out fossil fuel based unsustainable baseload plants. As I mention renewables energy technologies as an alternative to fossil fuels I am fully aware of the downsides of green energy as well (materials and energy usage, physical footprint, intermittency, high upfront costs, geographic limitations etc.) but as I already mentioned above that the most sustainable energy is the energy that we don’t use.
Anyways, I support the call for significant investment in low-carbon technologies is, but the unintended consequences of some approaches to the energy transition need to be clearly identified and addressed, especially for developing countries.
Renewables have already become the cheapest source of electricity in almost every country in the world today and still continue to be cheaper and more efficient. The most important thing that needs attention here is that even though renewables are nearly half of our electricity demand but electricity itself is only a quarter of our total energy consumption. It is because most of the energy intensive sectors (heating, transportation, some heavy industry, aviation, shipping etc.) still get their energy from fossil fuels that is less efficient than electricity. We need to electrify as much of this other energy as we can using renewables energy sources.
Transformation of Power Grid
We dont know a lot about the future of energy but we can tell from what we know today is that the future is electric. Electric future demands radical transformation in the power grid or network for distribution of electricity.
Because even though the 20th Century’s electrical energy system has lived up to the expectations by remaining remarkably reliable in connecting large centralized electricity production with our homes, businesses and other demand centres for the electrification purposes. But the tide has turned and the electricity challenges of 21st Century demand radical changes in the way we produce, distribute, and consume electricity to make our electrical energy system more efficient, affordable, resilient, and sustainable.
As ever increasing share of renewable energy sources (such as wind and solar), energy storage points, as well as demand response systems are being connected to our electricity networks the call for upgrading and redesigning power grid or network for distribution of electricity is getting stronger by the day because traditional power network initially designed for much simpler one direction flow of electricity from large fossil fuel powered plants to passive consumers is no longer fit for handling the complex electricity flows.
And it’s just the beginning because current electricity system getting complex with every passing day as thousands of new agents which never existed are entering the picture (such as large-scale intermittent renewable energy generation and growing amounts of distributed energy resources such as rooftop solar panels, small-scale wind turbines, electrolysers, batteries and even electric vehicles etc.). Therefore, it is clear that our grid infrastructure would require significant amounts of innovation and investment in order to handle these complex electricity flows and enable these thousands of new agents to transact safely with each other seamlessly.
How Digitalization can facilitate transformation of Power Grid
Digital technologies such as big data, machine learning and artificial intelligence are undoubtedly going to play a large part in transforming the electricity grid to pave the ground for efficient integration of massive variable renewables and consumer flexibility.
As the penetration of renewables and consumer flexibility increases in the Power Grid (Network for electrification). Power network struggles with the following challenges:
Some examples how digital technologies can transform electricity grid:
Digital tools for consumer – to enable the consumer to become the active actor of the power system
Digital tools for grid – to efficiently operate transmission and distribution grid
Digital tools for assets visibility and a marketplace to exchange energy services between those assets.
Digital Platforms to run electricity markets in different countries
Data management and analytics – decision support to grid operators
Self-healing technologies for balancing the generation and consumption
Tools for integrated monitoring, control, communication
Transitioning to Digital substation - software platform to operate substation, control substation and grid
Tools to enable operation with lower inertia so we don’t have to systematically curtail renewables - Using AI to identify and predict the geographical areas which might have inertia problem in the future so as to be ready to support those areas with enhanced frequency response to stabilize the grid.
If we can get the digitalization thing right for energy then that enhanced collaboration between with industry, regulators, grid operators, consumers can improve the safety, productivity, accessibility and sustainability of electrical energy systems. But as everything else digitalization has a cost too (i.e. new security and privacy risks). The best way to mitigate security and privacy risks associated with digital energy systems is by urging policy makers to include security considerations in all publicly supported technology research and design programmes, and in product manufacturing through standard-setting.
Need for Robust Data Fabric:
In order to fully reap the rewards of digitalization there is a need for robust Data Fabric:
Eliminating data silos
Automating data exchanges
Enhancing interoperability between digital systems - the ability to exchange data and information and coordinate decisions
All of this would require joint cooperation between all actors from generation, grid operators, academia, and technology provider.
There is also an emerging digital economy once the physical assets are digitized there is a massive opportunity for new innovative business models on the IT side.
If we get this right, we have the opportunity to create new businesses and jobs, empower consumers, and help people save their energy bills in the coming decades.
The role of Flexibility Services
If you have the ability to increase or reduce the production of your power generation sources or the consumption of your demand loads then you have a valuable good which is very valuable in today's energy markets and many expect that it will become even more so in the future.
As penetration of intermittent renewables increases in the system, and more and more energy use is getting electrified (for example because of e-mobility and electric heat pumps for heating) the electricity system becomes more decentralised and interactive. The need for flexibility services is getting more important to distribution grid operators to help manage the operations of grid efficiently.
Flexibility services can help energy networks operators to monitor energy flows and create market signals to motivate changes in energy supply and demand, integrating smart meters, smart appliances, renewable energy resources and energy efficient resources accordingly.
The need for complementary energy carriers (i.e. Green Hydrogen) for decarbonization of hard to abate sectors
As mentioned above, there are still many sectors that still rely on fossil fuels that is less efficient than electricity. But the bitter truth is that no matter how hard we can try there are going to be some industrial processes and heavy transport that can’t be electrified at all with the present technology and will have to run on some form of fuel.
Hydrogen can help in decarbonizing those sectors, as renewables are becoming more efficient sources of producing dirt cheap clean electricity it could be a good idea to use that excess renewable power from wind and solar to produce low-carbon fuels like hydrogen, biomethane, as these low-carbon gases can easily be stored in the existing gas infrastructure, and used for heavy-duty transport and energy-intensive industries like steel and cement.
Record low prices for renewable energy technologies such as solar and wind energy, and the need to mitigate the impacts of energy use on the climate change have accelerated the transformation of our current fossil fuel based addictive energy system towards clean renewable energy technologies based energy system.
But there is a limit to how much renewable energy technologies our current energy system can integrate because of the energy storage problem. Because as we know, until very recently, almost none of that power could be stored. Therefore, in order to meet end users demand at the exact second they need it, that power has to be generated, sent over miles of wires, and all of that has to happen in a perfectly synchronized dance.
Renewable energy technologies are intermittent and need to be coupled with some of storage option for optimal exploitation of these resources. Therefore, it is clear that large scale affordable energy storage is fundamental to the sustainable energy future. Out of all energy storage technologies, I foresee battery storage technologies playing critical role in the transformation of our energy system. Battery storage technologies have seen tremendous growth in the last decade. In 2010, batteries could power only our phones, computers and other portable electronics. But by the end of the decade, they have started powering our cars, houses, and power grids too.
According to Robert Armstrong, director of the Massachusetts Institute of Technology Energy Initiative, this puts limits on how much renewable energy you can practically use. Armstrong’s models suggest that without energy storage only about 10% of our power could come from solar. “The reason is that solar is concentrated around midday, so you need generation to match demand in the evenings and the mornings.
Pumped hydro stores most of the electricity today but building new hydroelectric dams is controversial and extremely damaging to local habitats. Some believe that battery electricity storage is a key technology in the world's transition to a sustainable energy system but battery technology is not yet good enough to efficiently store large amounts of electricity. Therefore, there is still need for searching other affordable solutions for storing large amounts of electricity.
Carbon Capture and Storage
If we really serious about getting to low carbon energy future then we need to focus not only on new infrastructure but also on the emissions that are “locked in” to existing systems.
According to some estimate by Robert Armstrong, director of the Massachusetts Institute of Technology Energy Initiative “By 2050 we will still be getting 75% of our energy from fossil fuels”. “A critical issue for us will be to figure out how to reduce carbon dioxide emissions from those energy sources. That is going to require carbon capture storage and utilisation. Lowering the cost of capturing the carbon is probably the toughest piece of that but we also need to figure out how to store it for geological timeframes.”
Market Design Reforms
The other important factor enabling systemic changes in the energy system could come from restructuring existing market design. Because introducing more new low-carbon generation options will require substantial new investment in transmission capacity and considerably larger reserve generation capacity to manage the network efficiently. Without sustained and significant carbon pricing, incentives for undertaking these necessary activities will be blunted.
None of the above is assured by current electricity sector policies in most countries around the globe. Where implemented, carbon prices remain too low and too unpredictable to induce the desired systemic changes. Feed-in tariffs (FITs) for new low-carbon generation carry substantial risks of being set too high (as has been the case for less mature technologies like PV in several European countries), producing excess supplier profits and high consumer prices; or too low, risking undersupply.
The transition to a sustainable energy future, however, will be challenging and all of the above solutions highlight difficulties in reconciling the goal of transition to a low-carbon energy supply with the aims of enhancing energy access, and improving operational and financial performance of the energy system of the future.
All of this would require joint cooperation between all actors from generation, grid operators, consumers, academia, technology providers, and national and local governments. If we get this right, we have the opportunity to create new businesses and jobs, empower consumers, and help people save their energy bills in the coming decades.
Transitioning to a sustainable energy future is not going be an easy journey and I agree that taking the road less travelled is not always the best choice but continuing along a road we have travelled post industrial revolution is a certain disaster.