Energy: a soon-to-be-renewed industry
The energy sector is heading towards a paradigm shift, driven by countries’ net zero targets and supported by smart tech solutions
The changes we will see in the energy sector in the near future will be characterised by three Ds: decarbonisation, decentralisation and digitalisation.
As worldwide targets to reach net zero by 2050 press the need for a viable alternative to fossil fuels, new technologies and systems are emerging. They are powering our planet into a cleaner and more sustainable future, while in the long term they will shape a more resilient energy economy with less volatility.
The near-future energy sector will be characterised by the three Ds: decarbonisation, decentralisation and digitalisation
Decarbonisation remains an urgent priority for industry, and hydrogen has emerged as a hero fuel for this shift change. Hydrogen production is expected to reach 168 million tonnes by 2030, creating a global industry worth $400 billion in revenue.
The main issues driving innovators in the hydrogen sector are clean generation, optimal storage and safe transportation. In the medium term, blue hydrogen – produced from fossil fuels but using carbon capture – will play a key role in the transition to clean generation. But the future goal is full-scale use of green hydrogen, which is created through electrolysis of water and is a low-carbon process.
Storage and transportation solutions include liquification and fuel cells. Fuel cells in particular will play a role in the development of electric vehicle mobility. Frost & Sullivan predicts that the fuel-cell electric vehicle market in Europe will grow by 78% between 2019 and 2030 to reach more than 300,000 fuel-cell-powered vehicles.
Decentralisation: the internet of energy
The internet of energy (IoE) is a decentralised system designed to harness and deploy renewable energy, and is expected to mature fully in the next 20 years. Three components feed into the IoE: the smart grid, new energy storage technology and distributed energy generation.
Across the world, upgrading to a smart grid is giving energy companies and end users more control over usage and costs. An EU mandate that 80% of consumers in member states had smart meters by 2020 shows the impact of legislation to drive change; many member states have now met or exceeded this target.
Japan, China and Korea are emerging smart grid markets, as is India, whose government aims to transition to 250 million smart metering points. Globally, unit shipments of smart meters are expected to reach 143.3m in 2030, up from 123.6m in 2019.
Distributed energy resources (DER) will see smaller, more localised renewable-power-generation facilities emerge globally over the next 10-20 years. Solar panels, wind turbines and hydro power generators sold as a service will be used to create renewable energy stores. Future DER models will also allow those who generate electricity to sell it back to the grid or to other organisations.
Blockchain is proposed as a mechanism for a new peer-to-peer energy market, although this is yet to bear out.
Of all distributed energy technologies, solar photovoltaic panels are set to be the largest DER contributor, with energy capacity set to quadruple globally over the next 10 years as the technology is adopted by businesses and individuals. Third-generation panels will make use of perovskites, which demonstrate a 70% reduction in costs when compared to silicon-based cells.
Meanwhile, virtual power plants (VPPs) will aggregate energy usage, with the VPP market (including soft- and hardware) expected to grow from $75m to $470m by 2030.
Energy storage is the third key component of the internet of energy. As well as battery storage – which, as with hydrogen, is synergistic with the growth in electric mobility – other solutions include supercapacitors, which store energy as static electricity, and transfer of energy to thermal storage, such as in ice and hot water.
Digitalisation trends include the disruptive impact of drones and artificial photosynthesis
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