Top 5 Digital Technologies Transforming The Energy Sector in '24
Consumer expectations on the type of service they require from their energy providers are changing. For instance, in addition to wanting a safer and cheaper source of energy, they also demand more sustainability, reliability, convenience, personalization, and control from their energy providers.
According to McKinsey, the increasing demand for energy and changing consumers’ expectations have made the energy sector more complex, competitive, and unpredictable. Digital transformation is how energy companies can overcome these challenges while improving sustainability.
This article will explore five digital technologies that are transforming the energy sector and helping companies improve their business.
1. Implications of IoT in the energy sector
IoT (Internet of things) can help increase efficiency in producing, selling, and distributing.
- IoT-enabled devices can benefit drilling management and improve health and safety in offshore oil and gas (O&G) production. Interconnected static sensors, mobile sensors, and cameras can provide real-time data for preventive maintenance, monitoring energy assets, and optimal decision-making in O&G production.
- IoT-enabled energy storage and analytics tools can analyze market data to help reduce the imbalance in the supply and demand of renewable energy.
- Through an integrated network enabled by IoT, Geothermal energy can be remotely produced and managed. Since Geothermal power plants are located in earthquake-prone areas, remote management can ensure employee safety. Systems such as SCADA (Supervisory Control and Data Acquisition) and performance management systems, AMI, ADMS can be enabled with IoT devices that act as receivers to provide remote access to employees for day-to-day energy production tasks.
- Advanced Metering Infrastructure (AMI) systems enabled by IoT-based smart meters can provide real-time consumption data for monitoring the use of energy, voltage fluctuation, tampering, and power outages. These systems can significantly increase efficiency in energy distribution and can also be operated remotely.
Figure 1. Value of IoT in the global energy market from 2020 to 2025
2. Leveraging AI and advanced analytics in the energy sector
- AI (Artificial intelligence) managed smart grids are networks that enable the intelligent flow of energy and data between the energy provider and consumer. This network enables the collection, storage, and analysis of vast amounts of data that can be used through advanced analytics and machine learning for fault identification in energy production plants and accurate energy demand forecasting. As a result, AI-managed smart grids can drive efficiency across the energy value chain.
- IBM’s new AI program uses self-learning weather models, historical weather data, data from sensor networks, and cloud information to predict solar forecasts, which are 30% more accurate. This also leads to more solar power generation with lower costs.
- More accurate forecasting and prediction from AI programs can harmonize fossil fuel and renewable energy provision. This can lead to increased efficiency and lower costs.
3. Automating the energy sector
Automation can benefit the energy sector in the following ways:
- Repetitive and error-prone tasks such as meter reading validation, billing, payment reversals, and complaint management can be automated with RPA (Robotic process automation) in energy trading.
- Robotics also has various implications in renewable energy. For instance, bots can regularly survey and maintain large equipment in solar farms and help avoid failures and accidents.
4. Connecting the energy sector with cloud computing
The implications of cloud computing are mainly in the management of energy production, distribution, and provision.
- Cloud computing applications can enable collaboration and enhance the visibility of financial and operational data across the network for better cost management and optimal decision-making on spending, productivity, and cycle time.
- Cloud can also be used to enhance customer experience by providing them with real-time insights into their current and forecasted energy consumption.
- Cloud technology can also be used in the predictive maintenance of expensive energy assets. For example, optimal scheduling can be created for maintenance, and backups can be managed automatically to avoid downtime and expected outage.
5. Implications of blockchain in the energy sector
- The growing network of energy transactions has created serious security and trust concerns from the parties involved. Blockchain technology has implications in transparent peer-to-peer energy trading.
- Blockchain technology can also keep track of the source of renewable energy and record the carbon footprint of different parties involved in the network.
- Another potential implication is in energy grids. Excess energy can be stored in the blockchain through smart meters, and algorithms can automatically match buyers and sellers of that excess energy using smart contracts.
- Successful small-scale blockchain technology pilots are being used for transparent and efficient energy trading worldwide.
Figure 2. Global investment in renewable energy technology from 2018 to 2021
To accelerate your digital transformation process, check out:
- Digital Transformation Frameworks from Top Consulting Firms
- Top 7 Digital Transformation Best Practices for the Organizations
- Digital Transformation in different sectors
- Digital Transformation Case Studies and Success Stories
- 3 Ways Towards Stronger Digital Dexterity
You can also check our sortable/filterable list of digital transformation consulting companies to find the most suitable option according to your business needs.
If you have any questions about digital transformation in the energy sector, let us know:
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