Where will energy efficiencies come from?

[Former Member]

If the UK government pushes ahead with its commitment to a low-carbon economy that is in the interests of its citizens, it will necessitate a shift from fossil fuels to renewable or alternative energy sources. However, with nuclear projects being cancelled in the wake of the Fukushima crisis in 2011, and coal-fired power stations slated for decommissioning, the challenge is on to contain rampant growth in energy demand while identifying sustainable energy sources and developing workable carbon capture initiatives.  But can the nation realistically turn down the dial on its energy consumption?

•     Heavy industry – In order to lift our economy out of the doldrums, increasing pressure is being applied to the manufacturing sector to drive productivity and growth.  But heavy, energy-dependent industries have a substantial base load requirement – increased output means increased inputs, so the likes of steel and cement works, chemical companies and industrial gas producers can’t physically elect to “do more with less”. 

•     Domestic consumers – At the other end of the spectrum, domestic consumers are being variously encouraged or exhorted to cut back on unnecessary energy consumption.  Education has a part to play (and it’s anticipated that smart meter insight will be a compelling teacher).  But the rising cost of fuel bills is already prompting householders to turn down the thermostat, turn off the lights and turn over a new leaf in their laundry habits. And with reduced Government incentives around feed-in tariffs, coupled with a lengthy payback period, solar panels remain out of affordable reach for many. 

•     Large enterprise – big corporations, such as offices and retailers, are already using sophisticated management systems to automate and control energy usage in heating, lighting and computing. For example, many supermarkets are already using analytical tools to optimise their energy bills by comparing stores’ power consumption and correlating it to metrics such as square footage, opening hours or sales.

•     SMEs – It would appear that the only energy users with significant underexploited potential and motive to reduce overheads are small and medium-sized businesses. These enterprise have traditionally lacked the intelligent systems needed to automate and measure the impact of energy efficiency initiatives. However, following the UK smart meter roll-out to businesses as well as homes, it is anticipated that energy retailers will be able to use “big data” to profile organisations and benchmark their consumption against their peers in the sector. One of SAP’s energy customers is already doing this to great effect with a tablet-based application to help businesses identify efficiencies. 

•     Energy providers – for energy producers and retailers, digitisation is set to revolutionise power generation and distribution. Tools and platforms such as Complex Event Processing based on real-time “big data” could be used, for example, to trigger forward-buying by combining information on weather patterns with oil prices. Additionally, remote readings from meters could enable automatic monitoring throughout the value chain, and indicate risks such as leaks by calculating where outputs are lower than inputs. 

On the face of it, economic growth and the reduction (or at least, restraint) of our national appetite for energy may seem to be at odds.  But advances in real-time insight are accelerating progress towards smarter use of energy and better management of assets, which will hopefully keep the lights on over the national economy until such time as the innovation gaps in environmental technologies are plugged.