Matt Tormollen, CEO of POWWR, discusses how energy suppliers can facilitate data to become more environmentally conscious.
We are currently in the midst of one of the most consequential energy transitions since records began. The increasing availability of clean electrons has motivated businesses in the UK and beyond to think green. And for good reason. Environmental accountability attracts customers, appeases regulators, retains staff, and can even gain handouts from the government.
The world’s move towards a greener future will only continue to gather pace. Renewable energy’s share of the power generation mix is set to rise to over a third by 2025 alone. With solar and wind driving most of the growth, the renewable energy market is expected to grow from its current $1.21 trillion compound annual growth rate (CAGR) of 17.2% between now and 2030.
Capturing even a sliver of this market represents a massive opportunity for energy suppliers. However, some need to work hard to win back customers. In their drive to appeal, certain energy suppliers have been guilty of ‘greenwashing’ to exaggerate their environmental credentials.
Those suppliers – and those that have played fair – have recognised the need for greater environmental accountability. They are looking to produce a certificate of authenticity – such as a Renewable Energy Certificate (RECs) – to prove that the energy they generate comes from the renewable sources they say they are.
The difficulty with energy genealogy
The problem with producing a REC or similar is that ensuring complete energy genealogy throughout the supply chain remains remarkably difficult. One of the reasons is a lack of consistent data from top to bottom. Partly, this is because most energy production globally still runs on clunky, often bespoke, software. This makes data siloed and challenging to assess.
Also, the systems have been designed for predictable assets like coal or oil, not dynamic assets like solar and wind. This dynamism makes the problem of extracting intelligence more complex as it increases the amount of data being produced. The energy industry is now thought to generate up to 200 exabytes of data per year.
Thankfully, there is now technology available – underpinned by Artificial Intelligence (AI) and Machine Learning (ML) – that can promptly sift through this mountain of data. Doing so helps facilitate environmental accountability by collecting the requisite data to produce the aforementioned REC.
Collecting the right data to provide environmental accountability
For some time, technology has facilitated everything from giving an end-to-end connected journey for energy sales to managing risk during unprecedented price volatility.
Yet, recent technological advancements such as Internet of Things (IoT) sensors, robotics, and AI have helped create novel approaches to help meet climate and sustainability goals. However, accessing these devices – and the data held within – can still involve manual and time-consuming processes.
Even when technology such as AI can help, it must be remembered that it is only as good as the data that flows into it.
In 2024 and beyond, it will not be about collecting more data from such devices but the correct data. So much so that the market for such Big Data analytics use within the energy sector is expected to grow from $8.37bn in 2023 to $14.28bn by 2028, at a CAGR of 11.28% during the forecast period (2023-2028).
Completing the circle
As well as legacy energy suppliers looking to clean up their act, countless new entrants want to set themselves apart by being seen as an environmentally conscious alternative. And for good reason. Any suppliers that can help the world access cheaper and cleaner energy sources will only grow into an enduring brand for years to come.
Environmental accountability will be essential. Ensuring energy genealogy throughout the supply chain has been difficult, with energy production becoming increasingly decentralised as it has become decarbonised. However, IoT sensors can facilitate this accountability by collecting energy data from myriad distributed devices.
Data has been imperative in the sector for some time to help predict weather patterns and production demand and optimise operation process efficiency. But as regulators, stakeholders and customers look to hold energy companies accountable for their claims, proving the energy they produce is from renewable sources has never been more important. Or more difficult. Yet, using the latest in AI-empowered technology can help complete the circle.
The benefits are twofold. As data becomes more prevalent and accessible, energy management solutions will also become more precise, amplifying the benefits businesses can derive from renewable energy. At the same time, it will enable companies to save on energy costs, whether by procuring energy from the cheapest supplier or facilitating energy use when rates are most affordable.
