ENERGY INNOVATION 2021

By Florian Kolb Chief Commercial Officer & General Manager Energy Intertrust Technologies Corporation

ENERGYCENTRAL - Feb 3, 2021 - 2020 has been a year of big surprises and disruptions, something which extends to the utilities industry as well. The pandemic has led to an abrupt end of existing B2B energy consumption patterns and, to a certain extent, also in B2C. The energy systems around the world have had no or little time to adapt to these sudden changes. Given the underlying demand and supply structures of the electrical energy industry, these fluctuations were big for energy, but relatively small compared to the disruptions other industries have seen. Overall, it is fair to say that utilities have proven they can respond with the same robustness as they have in previous crisis moments.

Given the pandemic, it’s an interesting task to think ahead about what will happen in the industry in 2021. To boil it down into a short statement: no revolution expected, the evolution to a more digital and carbon-free grid and industry will continue.

What will be the nuances of this evolution in 2021 for the electrical energy value chain?

• Given the successful start of vaccination programs, the pre-pandemic state of electrical energy will be reestablished soon. One of the highlights for 2021 in the U.S. (with global implications) is the start of the Biden presidency. The Biden administration’s pledge to reestablish the U.S. commitments to fight global warming and the climate crisis is a big thing with large implications for the electrical energy industry.

• The push for more wind and solar generation will accelerate in 2021, as well as for the end of coal. In regions such as Europe, the end of coal is already progressing well. This implies that the decentralization of the energy system will accelerate, requiring additional efforts to balance electrical supply and demand. Delivering this balance, as well as ensuring sufficient profitability levels for renewables, will require the industry to push forward with additional efforts to strengthen its digital infrastructure and energy data handling.

• For transportation and distribution grids, one of the biggest issues in 2021 will be the increased penetration of electrical vehicles. All research confirms that certain adjustment measures are required to ensure an efficient and reliable grid. The key question here is how quickly electric vehicle penetration will increase over the long term. Given the relative low elasticity of the grid infrastructure, it will be important to take measures early enough to meet this challenge. One big element for 2021 therefore will be to ensure that efficient digital grid planning and scenario analysis is enabled to meet this challenge. With more volatility from electric vehicle charging approaching the grid, utilities have to expand this capability. Grid scale storage can significantly contribute to solving peak demand issues so this will be another area of innovation.

• Hydrogen in grids will remain an R&D topic in 2021.

• In 2021, downstream (energy B2C and B2B) retail businesses will see continuous efforts by new entrants challenging incumbents in competitive energy retail markets. Energy retailers will also try to offer their customers value-added services beyond standard commodity energy. These can include flex management services for behind-the-meter devices, home IoT services, and electric vehicle charging.
• As for innovation, investment in energy innovation in 2020 has been affected by the pandemic to a lesser extent. Given the contribution of innovation to mega-trends such as electrification of everything and climate change, energy innovation is expected to continue to flourish in 2021.

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This thought leadership article was originally shared with Energy Central's Utility Management Community Group. The communities are a place where professionals in the power industry can share, learn and connect in a collaborative environment. Join the Utility Management Community today and learn from others who work in the industry.

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