Today’s innovation in data and digital tech will save trillions from our outdated energy system: Molly Webb

14 June 2016

Molly Webb, Founder of Energy Unlocked, writes about the role of energy productivity in driving the clean energy transition – and how we can secure and scale the innovation needed to drive this transition.

The world needs a clean power shift. But to drive efficiencies in how the world buys, uses and consumes electricity requires technological, digital and business model advances.

Starting today down a decarbonization pathway which embraces both energy efficiency and demand-side flexibility will save the global economy up to US$2.8 trillion to 2030, compared to a renewable but more energy intensive pathway to limiting global warming to 2 degrees.

One trend driving the shift in focus beyond energy supply to energy demand, is information technology. As American investor and entrepreneur Marc Andreessen observed: “Software is eating the world”. It is certainly licking its lips at the energy system, which has not evolved since our grandfathers’ day.

In 2008, I co-authored the SMART 2020 report for The Climate Group and Global e-Sustainability Initiative which galvanized the global ICT sector to target energy efficiency savings worth €600 billion (US$674 billion) a year in 2020. Eight years later, the potential of the ‘Internet of Things’ (IoT) is even better understood.

SMARTER ICT

Shared electric mobility, which is delivering 70% car utilization. Lighting as a service using data sensors to drive efficiencies. And microgrid as a service to accelerate distributed energy, faster.

These are just some of the innovative products, services and projects companies shared at the Energy Productivity Pioneers event at this year’s Clean Energy Ministerial (CEM7). Diverse organizations like Stem, Ingersoll Rand, Johnson Controls, Legrand, Cree, Tech Mahindra, Cisco, Evercar and Open EE and the Rocky Mountain Institute are united in looking at how to bring solutions to market needs that can accelerate energy productivity.

But getting to market isn’t straightforward – and common international barriers exist. For example, a lack of standards that enable faster efficiency financing to sector-specific regulations as seen in California’s rules for use of ‘personal’ vehicles for ride-sharing companies.

What drives the solutions across sectors are stringent codes, government procurement or innovative challenges, such as the US Department of Energy’s Better Buildings Challenge.

As policymakers look to harness advances in smart technologies, IoT, energy storage and renewable energy, out-dated regulatory frameworks often represent a major barrier to the innovation and competition needed to cut bills, tackle climate change and keep the lights on.

NEW CHALLENGE

There are thousands of new market entrants to the energy sector as companies look at the rewards that could follow from this digital transformation in our energy systems.

So through the Energy Productivity Innovation Challenge (EPIC), an initiative of the ClimateWorks Foundation, Energy Unlocked is seeking out global companies that pledge to double energy productivity.

EPIC will identify the solutions and companies currently in the market, analyze how transferrable and scalable these companies are, and hear what common market and policy barriers are stymying their progress, ultimately producing a report.

We seek participation from companies across several sectors – homes, buildings, systems, mobility and finance – and entrants will be judged by representatives from Bloomberg New Energy Finance, Mahindra, International Energy Agency, the ClimateWorks Foundation and Rocky Mountain Institute, among others.

Judge Michael Wilshire, Head of Analysis and Transformation, Bloomberg New Energy Finance said about the EPIC launch event at CEM7: "Entrepreneurs and new market entrants innovating in the energy sector will help set the framework for a more efficient low carbon energy system, that builds on new technologies and approaches."

Policies that take into account just the supply side of the energy system condemn consumers to higher tariffs. Innovation has fundamentally challenged and disrupted a great many industries and energy should be no different. EPIC will identify and challenge barriers holding back this disruption – and ultimately accelerate our energy transition.

The technology we need to get started exists today. But we must also scale and transfer innovation, in order to map a trajectory to more energy productive systems.

It’s time for energy productivity to drive the global power shift to a cleaner future.

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