Tens of billions of kWh of electricity are consumed around the world each day, allowing people to communicate, travel, conduct business and live comfortably as in lighting and heating buildings. Currently, 60%[1] of global electricity is generated from fossil fuels and the energy sector accounts for around 70%[2] of global greenhouse gas emissions. Therefore, reworking our energy systems would be a necessity for our future.
It will be essential to increase the proportion of electricity generated by renewables if national emissions pledges, which are being renewed and improved at COP26, are to be met. For example, India’s new 2070 net zero target is complemented by a pledge to increase the fraction of renewables in its energy mix from 38% to 50% over the next decade[3]. However, the greater the share of renewables the trickier it is to control the grid because of their intermittent nature. Wind and solar power cannot be ramped up or down to match the demand for electricity, unlike fossil fuel power stations. As fossil fuels are phased out, this flexibility must arise elsewhere: energy systems should be transformed from a state of centralised generation and unidirectional electricity flows to responsive, decentralised networks.
A key resource now at our disposal to improve energy systems is detailed data from across the energy value chain, from generation to end use. The Digital Revolution has put digital technologies into our hands, homes, and workplaces, generating a staggering volume of data about our activities. Moreover, the flow of information between smart devices enables greater efficiency and convenience. In the context of the energy sector, digitalisation encompasses improvements in data harvesting, sharing, and analysis as well as data-driven decision making. Digitalising energy systems to obtain and interpret data could transform the sector and assist in its transformation to a low-carbon, efficient, and resilient development.
The advantages of digitalisation are manifold. First and foremost, digitalisation helps operators monitor and respond to changes in grid stress level, improving energy system resilience to disruptions. Moreover, with access to the right data, artificial intelligence can be used to predict electricity demand and generation from weather-dependent renewables, enabling the optimisation of electricity production. In addition, demand response facilities – such as ‘smart’ charging of electric vehicles when wind or solar power is abundant - can be utilised to ensure there is the right amount of electricity in the grid at any time, avoiding blackouts. Furthermore, sensing and artificial intelligence technologies can empower consumers to adopt time-of-use tariffs - in which electricity costs less when overall demand is lowest - reducing their energy bills and emissions. Digitalisation can also promote decentralisation of electricity generation and incentivise investment in small-scale energy production, as data analysis allows for the optimisation of microgeneration and storage at the community level.
While the theoretical benefits of digitalisation are well understood, the widespread adoption of these technologies need to be preceded by demonstrations of business and regulatory models that promote uptake. Recently, the United Nations Environment Programme (UNEP) and the Italian Ministry for Ecological Transition (IMET) have launched a call for pilot projects to support digitalisation and development of flexible and resilient energy systems. The initiative was launched with an open call for proposals to provide grant funding for one or more pilot projects in Brazil, Colombia, Morocco, Tunisia, India, Indonesia, and South Africa. Funding is available for pilot projects that demonstrate business and regulatory models for the uptake of smarter digital power infrastructure. Three types of projects are eligible: urban smart energy, islanded systems, and existing asset enhancement.
The aim of the pilot projects is to increase the availability and quality of energy systems data, in addition to building capacity for its interpretation and translation into useful information. On the ground insights and lessons learnt from the pilot projects will further feed into the International Energy Agency (IEA)’s led Digital Demand-Driven Electricity Networks (3DEN) Initiative. 3DEN is a 4-year inter-agency initiative focusing on the policy, regulatory, technology and investment context needed to accelerate progress on power system modernisation and effective utilisation of demand-side resources.
The solutions proposed in the pilot projects will differ for each country, but they will all focus on accelerating energy system modernisation and help position resilient, low-carbon energy systems at the centre of national climate strategies. We must use this critical juncture to transform energy systems across the world if the goals of the Paris Agreement are to be adhered to.
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