Which trends will shape the energy industry in 2021?
Energy efficiency is important for companies in many fields of activity: industrial production, distribution and logistics, construction and real estate, etc. Energy efficiency performance depends on the quality of the equipment used, but also on the ability to maintain it in good working order, and here digital and sensor technologies are of great help.
Another important factor is the existence of a rational energy management policy resulting from an open management, oriented towards the implementation of specialized energy services, coupled with expertise in this sector and, very importantly, with the analysis of the monitoring of consumption processes, the indication and highlighting of points of deficiency, the relationship between distributor – supplier – end consumer.
In the year 2020, in all the remaining sectors, the situation generated by the global pandemic has stimulated creativity, digitization and the creation of new services. So what can we expect to see in the energy sector in 2021?
Consumer focus becomes essential
In a changing economic environment marked by uncertainty, customer centricity will be key to attracting and retaining customers and ultimately ensuring a healthy business. People have become accustomed to digital services in most areas of their lives, and expectations for transparency and flexibility are now much higher. As a result, customers are becoming more likely to switch energy suppliers, especially after the liberalization of the electricity market for households. The needs of all end-users are also evolving. For example, the growth of electric vehicles, private solar panels and heat pumps creates a need for integrated solutions, products and services. It’s time for electricity providers to put the customer at the center of every decision and meet the customer’s needs by providing technical support services such as HVAC overhauls and installation of related equipment such as smart home equipment.
Internet of Things and Smart Grids
More efficient operation of electricity grids and smart grids are a key element in transforming the energy sector. The Internet of Things (IoT) and the asset monitoring sensors, inspection drones or satellites used in this field produce a wealth of data. Sharing this data with all stakeholders and using it to find the right answers to efficiency questions will be key to making network operations more resilient, flexible and sustainable. In addition, the use of Data Analytics technology to extract relevant correlations from the huge amount of data generated in the energy and utilities sector provides insights into customer usage patterns. This information enables demand forecasting and efficient energy management, but it can also help prevent fraud, reduce losses, improve compliance with regulatory demands and improve customer service. At the same time, the introduction of blockchain technology will enable traceability of energy supply and how it is produced from renewable sources. Using data in this way will increase user satisfaction and help companies turn data into money.
Smart Meters – Manufacturer and consumer dynamics
The interaction between producers, consumers and grid providers is becoming increasingly close. In recent years, the number of people who are both producers and consumers of energy (e.g. homeowners and industrial installations with photovoltaic panels on roofs) has increased. Every prosumer is a potential energy manager who needs to work with electricity producers and suppliers, and their impact grows with their numbers. But with a growing number of “micro-entities” in the system, how can energy companies take their input into account when production and demand are still so volatile? This is where smart meters show their value as they help bridge the gap between consumers, producers and energy suppliers. Consumers get an overview of their consumption profile and can spot potential savings by changing routines or adapting infrastructure. For electricity producers and suppliers, smart meters provide insights into user behavior and thus lay the basis for large-scale demand response. The backbone of this transformation is a smart grid that “thinks” predictively and provides data-driven recommendations to the market on when to store, sell, transform or consume energy. Smart metering is the basis of all energy efficiency projects and now, with the introduction of mandatory EU-wide legislation to install only smart meters, this impact will increase and result in energy efficiency.
Automated Energy Management and Artificial Intelligence (AI)
Data Analytics solutions provide the real-time analytics needed to optimize operational performance and decision-making. As a consequence of shorter delivery times to market, the focus in energy management is shifting from long-term planning to enabling near real-time reaction to changes. This requires largely automated bidding and delivery processes, but also large volumes of data and artificial intelligence for forecasting , both for energy companies and for companies working in energy-intensive sectors. Increasing adoption of cloud platforms in the energy and utilities sector is expected to have a positive impact on market growth. However, the market faces major data security challenges as well as data privacy issues. In addition, some energy companies lack data analytics expertise and struggle with integrating new software solutions into legacy IT architecture. In order to balance these factors and adapt to market demands, energy companies need to invest in and enhance their IT skills.
Hardware and digital technologies
Hardware and digital technologies will start to co-evolve, both needing each other to deliver the required impact in terms of efficiency and resilience. Traditionally, energy has been an industry with a strong focus on physical processes. Improvements in hardware, machinery and equipment technology and the way it operates will be just as important in the future, but will not be enough to make the difference. Energy companies that want to become more efficient will also need to focus on the digital transformation side. Data analysis with powerful software will be needed to support future improvements in electricity generation, distribution and consumption.
Authorized Energy Services Contracts
The use of authorized energy service providers has shown its value in recent years through energy management and auditing adopted at the company level which is aligned with the energy efficiency law, thus succeeding in implementing and completing European energy policies. These contracts have led to the implementation of essential measures, such as smart metering, a measure that gives a mirror of consumption and profile of the final consumer, financing options for implementing efficiency measures, centralized analysis in monitoring dispatching, prevention and energy management in an efficient way.
To sum up…
To keep up with continuous change and technological evolution, energy companies as well as large consumers will need to focus on technology and digital skills. They will need to invest, gain knowledge and join the competition for well-qualified IT experts. The good news is they don’t have to do it all alone. Experienced energy efficiency partners like EnergyPal can help both energy companies and industrial users build a resilient business and thrive in an environment where change is constant.
