Over the last ten years
improved information technology has enabled markets to provide people with more
inclusive, consumer centric services. This change in consumer behaviour and the
response by service providers highlights an opportunity to revolutionise the
UK’s energy system.
Andrew Haslett looks at the challenges
and opportunities in transitioning from the UK’s current energy system
architecture to a low-carbon, energy system of the future.
The last decade has
witnessed an internet revolution that has changed the way in which we shop,
bank, communicate, access entertainment and keep up with the news. This has
meant that industry has had to innovate - adopt or fail. We have seen the
innovations that improve services for consumers, providing greater control and
choice at competitive prices, have been the most successful. This significant
change in information technology and trend for greater consumer participation
has arrived as we face the challenge to decarbonise our energy supply.
We are now looking at transforming our
energy system architecture in the context of a world that is moving rapidly
towards greater consumer centric services. Services that give people more
control and information over the things they purchase. However, the supply and
use of energy is very different from books and electronics, news or groceries.
Information technology alone does have the potential to change the current
energy system. It will therefore take time to develop critical infrastructures
as we work out how to integrate different technologies that work well together
within a whole low-carbon energy system.
We know that the UK’s existing energy
system architecture, doesn’t currently have the capacity to make the transition
from the current dominant system based upon liquid-based fuels for vehicles and
gas for heating, industry and power generation to a more diverse supply system.
We also cannot pinpoint exactly how decarbonisation of the UK energy system
will proceed, but we can predict that it is likely to displace the reliance on
the use of fossil fuels and position electricity to play a much larger role in
transport and heating.
This said, electrifying transport and
heating will present the UK with new and unfamiliar challenges. In this
unpredictable world, it is vital that we revise the current architecture of our
energy system whilst it is still operating, so that it can evolve to meet
changing needs and adopt new technologies. Post privatisation, our energy
system architecture has been operating on incremental investment whilst
maximising its capabilities. With increasing pressure from advancements in IT
in the hands of consumers, there is a question over how quickly and effectively
our energy system can respond in its present form, whether led entirely or
partially by the state.
In terms of making key decisions for a
complex system of energy services, we see a number of mechanisms through which
it will be delivered. Investment in cars and heating will be left to the
market, whilst networks will still need some regulation or direct state
investment. There is a strong argument that future local network decisions
should be integrated into local energy plans, involving local residents for a
more effective outcome. Decisions around the construction and delivery of a new
energy system, as well as control of assets and architecture need to be made
explicitly and up front if we are to mitigate risk for all stakeholders.
Though some modern IT systems have only
just started to penetrate the energy sector we see huge potential for sensors
to capture data and software tools that transform data to produce information
and insight that is easy for consumers to grasp. As part of work commissioned
and funded by the ETI, the Energy Systems Catapult has prototyped various Home
Energy Management functions designed to present heating and heating information
in a new way to consumers. We have seen that these systems have significant
opportunity to create greater consumer involvement. The data that these type of
systems capture will become a major resource to improve the design and
operation of energy systems and help to shape better services matched to
consumer needs and preferences.
The move to decarbonisation will not be
easy. From a whole energy systems perspective we see the most cost-optimal
solution involving decarbonising power first, then heat with transport in
parallel to both as it is a more complicated sector and will take longer. And
this should be through a blended mix of complementary technologies as
decarbonisation does not depend on new revolutionary ideas, more the
development, commercialisation and integration of known but currently