Although the energy sector is steadily innovating, the time for real disruption is long overdue.
If we are to have any kind of chance of tackling climate change, reducing the UK’s carbon output to net-zero by 2050 is non-negotiable. To do this, the energy sector simply cannot remain as it is.
The popularity of renewable energy is soaring, but this alone isn’t enough. We need to make serious changes to the way we consume, and think about, energy. It is not a magical, endless, substance that appears at our homes and businesses ready for use. Unless we overhaul our relationship with energy, we continue to harm our already-ailing planet.
When we talk about the disruption of the energy sector, there are several key factors leading this shift:
These ‘four Ds’ of energy are driving the disruption of the energy sector. If you’re a regular reader of the RenEnergy blog, you may have spotted Nigel Cornwall mention them in his Future Voices Q&A.
Really, these four Ds are simply four ways in which the energy sector must change, including how we buy energy, who we buy it from, and how we use it. Below, we’ll explain the terms in more detail, plus why they matter…
Of all the four Ds, this is perhaps the most important.
Reducing society’s greenhouse gas emissions (of which carbon is the biggest culprit) to net zero is our only real strategy for slowing climate change. At this stage, we can’t even stop or reverse global warming: only slow it. The quicker we can structurally decarbonise our energy, the better.
Choosing renewable energy is a good first step when it comes to decarbonising the energy sector. However, we can’t stop there. We must also embrace associated technologies such as battery storage and electric vehicles and take steps to remove or offset the inherent carbon present in our infrastructure.
Overall, we’re moving in the right direction. Electric vehicle ownership and solar PV usage are up, and the price of solar PV is becoming more affordable. But, these moves should not be considered a ‘sticking plaster’ for climate change. Our current infrastructures are heavy with embedded carbon, requiring deep, disruptive change. Check out our Future voices Q&A with Dr Nigel Hargreaves, where he discusses the systems-based change needed in the energy industry.
The decentralisation of energy refers to a move away from one large national grid. Instead, energy is generated closer to where it is used. This could take the form of autonomous local microgrids, or clean local powerplants, such as solar farms.
Decentralising a region’s energy supply poses many benefits. According to a report in Raconteur, deploying local solar plants, small wind farms, battery storage and combined heat-and-power plants, makes the energy market more competitive, reducing prices for the consumer.
Not only are these decentralised renewable systems better for the environment, they tend to be more reliable, too. Any localised issues stay local, so faults may be repaired more quickly, and a reliable energy supply maintained.
As we’ve all heard, knowledge is power. The digitalisation of the energy sector involves the increased use of technology, data, and measurements to better manage our energy. Basically, it means using all the information at our disposal to make sure we’re being as energy efficient as possible.
The increased use of technology allows us to measure energy flows, keeping systems running smoothly, and allows customers to only procure the energy they need, so nothing is wasted.
After all, how can you know if your climate change initiatives are working if you’re not measuring how much energy you’re using, or carbon you’re saving?
Also know as deregulation, democratisation is about making the energy industry fairer for consumers.
This article on Medium explains the democratisation of energy perfectly:
“Historically, utilities emerged as state-regulated monopolies, and they still are in some countries. In a regulated energy market, the government has control over electricity prices, which leaves little room for competition and little choice for customers. However, with the global energy demand increasing, the new capital investments required exceeded the capacities of governments. Unable to create new sources of funding, the governments of many countries started to turn to the private sector and therefore deregulate their energy markets.”
Fortunately, the UK energy market is already largely democratic, with plenty of consumer choice and healthy market competition. However, there is always room for improvement.
As you can see, there is plenty of overlap between the concepts of the fours Ds. Although decarbonisation is the key step in the fight against climate change, factors such as digitalisation, decentralisation and democratisation will help make it possible.
In our fight to manage climate change, switching to renewable energy alone isn’t enough. We need complete disruption of the energy systems as we know them.