How future energy technology developments may impact your energy projects
How do you ensure that the projects you're implementing today aren't negatively impacted by future energy technology developments?
Technologies like solar PV, battery storage and energy optimization can help get your organization started on the path towards a low carbon future. They can also help you to improve operational resilience and become more cost efficient.
However, new approaches are constantly being developed. When implementing new energy projects, it’s important to think about how they might be impacted by future technological developments, and then adjust your approach accordingly. This can help your energy projects to deliver the best value today, and into the long-term.
While you’re implementing energy projects today, how can you ensure they’re future-proofed for the changes that lie ahead? Let’s take a look at a few important technology trends that are on the horizon, and what they might mean for your energy projects.
Technology and innovation to secure net zero
There are three key areas where developing technologies can help your organization secure net zero. Although many of these solutions exist today, it’s how they will develop and become commercially viable that’s important for the role they will play.
The first avenue area where technology can have an impact is alternative fuels. Using hydrogen as an alternative to natural gas in commercial heating systems and industry operations has great potential to provide a simple way to reduce emissions in the long term, particularly for industrial processes that require high intensity heat.
While hydrogen may not currently be a commercially viable alternative to natural gas, markets and technologies are quickly evolving. As the scope of applications become clearer and demand increases, alternative fuels should become more viable. Large organizations, national governments and regulators need to lead this transition of our energy system.
The second area where technology can help your business achieve net zero is electrification. The explosive growth of renewable electricity from solar and wind, in particular, is enabling the switch from fossil fuels to zero-carbon electrified alternatives.
Using electricity to generate heat, drive transportation and power industrial processes isn't new. However, as the cost of green generation sources reduces, the business case for using electricity is much more attractive. For example, heating may be switched from gas boilers to heat pumps. Many countries are regulating the shift from internal combustion engines vehicles to electric vehicles (EVs) and low-temperature industrial heat could be replaced by high-temperature heat pumps.
Thirdly, the digitalization of energy through data analysis and optimization can help your business reduce its carbon emissions. Through insights, analysis, connected devices and optimization, technology is enabling greater efficiency and lower emissions.
While today’s energy management software can provide insights on energy use, tomorrow's technology will enable real-time carbon intensity data. Advanced controls will be developed that can co-optimize site loads and advance hardware to enable renewable microgrids. This will also allow for greater connectivity among national, local and on-site assets and devices.
See how insights helped a leading restaurant operator to avoid $1.2 million in unnecessary energy costs
The impact of hydrogen on decarbonization
It’s likely that hydrogen is around five years away from being widely available as a fuel in hard-to-decarbonize industrial processes. While it is available today, it’s often expensive and challenging to deliver to site. When it does become more widely used, the impact it will have on decarbonization will largely depend on the level of regulatory and policy support for hydrogen infrastructure.
Within four years, it’s likely that hydrogen from steam methane reforming, or coal gasification will be primarily used as a reactant for industrial processes. Green hydrogen is likely to be limited to niche use cases, such as fuel cells for forklifts, due to the high costs of H2 relative to natural gas.
Five years into the future, we can see the development of the most sustainable form of hydrogen being more commercially available. Known as green hydrogen, this fuel is produced using renewables and/or carbon capture and storage – making it 100% green. Although it’s unlikely to be used widely, due to its current high cost, there could be near-term limited adoption of hydrogen use in industrial equipment as supply grows, enabling costs to fall.
Within the next ten years, we’d expect to see strong regulatory support for hydrogen. Assuming hydrogen infrastructure exists, heat decarbonization is likely to be driven by hydrogen boilers as they have a lower cost compared to heat pumps.
Additional policy support from governments will be required to drive heat decarbonization. The likely result will be a network of heat pumps, electrification of boilers and hydrogen – creating a more sustainable and flexible system for further future development.
See how the hydrogen system of the future will come together:
The electrification of energy
With the explosive growth of renewable energy over the last decade, fossil fuel heating, transportation and industry could also be replaced by electrified alternatives. For example, heating may be switched from gas boilers to heat pumps, transportation will likely shift from combustion engine vehicles to electric vehicles, and low-temperature industrial heat can be replaced by high-temperature heat pumps.
Electric vehicles and smart charging will become more widespread. In fact, ninety percent of U.S. cars need to be electric by 2050 to meet climate change goals.
Five years into the future and vehicle-to-grid (V2G) and microgrids will be capable of islanding and feeding power back into the grid. This would enable further integration of flexible, electrified end-uses, such as heat pumps, heat pump water heaters, and electric vehicles. High-temperature heat pumps will become a substitute technology for low-temperature industrial heating below 180°C, which currently makes up 45% of industrial heat.
Connected software to reduce emissions
Increasing amounts of internet-connected distributed energy resources (DERs) are becoming integrated into the electricity system. As such, insights and optimization software are critical to ensuring these resources are used effectively to reduce emissions.
Today, energy management software can provide insights on energy use, which can be leveraged to identify opportunities for efficiencies. Electric vehicle charging software can optimize loads to meet grid and site needs. Software developed by energy companies and startups can enable companies to automatically respond to demand response signals, based on peak demand or time of use. Building optimization software can take occupancy into account to optimize and reduce energy usage.
Within the next five years, real-time carbon intensity data can be used to provide more accurate insights into an organization’s energy consumption. Real-time marginal emissions data can be used to optimize the dispatch of DERs to maximize their emissions reduction.
Developing technologies like augmented reality for maintenance and repair (ARMAR) could have a role in enabling a faster, more efficient construction and maintenance of DERs. Advanced controls will be developed that can co-optimize site loads, solar PV, batteries and EV charging. The aggregation of DERs for market participation will become widespread, increasing business revenue.
Five years into the future, there will likely be a wide roll-out of 5G technology that will allow for greater connectivity among DERs and devices, particularly small IoT sensors.
Optimizing your energy strategy: how we can help
To achieve full decarbonization and future-proof your organization’s energy portfolio, your energy projects need to align with a carbon reduction strategy that is both financially and environmentally sustainable.
Centrica Business Solutions is working to meet this challenge. We continuously investigate, evaluate and invest in developing technologies, combining them with our Energy Pathway methodology. Our research is focused on coordinating technology with customer projects over the long-term and developing scalable solutions to meet common commercial challenges.
Discover how Centrica Business Solutions’ Energy Pathway can help you optimize your energy strategy for a low carbon future.