IoT, Distributed Renewable Energy, and the Grid

By Traver Kennedy, Chairman and CEO on May 29, 2018
Traver Kennedy
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Closing the 100-Year Gap in the Era of Untethered Devices

When it comes to electricity, we still have a 100-year gap. More than a century after the first cables were laid, 15% of humanity is still in the dark. Hopefully, this may soon change. In 2016, Deloitte published an article that analyzed how the Internet of Things (IoT) was poised to reshape the way utilities do business. In the article, the firm wrote that IoT would most likely transform the grid from “a one-way system where power flows from centralized generation stations to consumers, to a platform that can detect, accept, and control decentralized consumption and production assets so that power and information can flow as needed, in multiple directions.”

Two years later, it’s not just IoT applications that are making the power grid a more intelligent and efficient system, as Deloitte envisioned it would. Rather, IoT devices of all types now feed energy to and from the grid, which are serving to speed up the decentralization of electricity’s consumption and production. The reality is that, in a world of untethered devices, we need equally untethered electricity.

See the edge in a new light.

 A Dark, Dirty Edge

Just a mere decade ago, the “edge” of the grid was relatively easy to identify. Generally, the “grid” describes the core high voltage lines carrying electricity to the “distribution” network, which serves as the edge. The edge is the place where electricity is generated locally. Historically, this was done using diesel generators, which continue to have prevalent use today. Occasionally, you would see wind and solar being used. If you were poor and lived on this edge (which does not only equate to remote locations), you went from zero to intermittent power, depending on what kind of local electric generating fuels and devices your community had access to.

The electricity grid and distribution network has not expanded much in this decade. While 103 million people have gained access annually since 2012, in reality, this expansion is growing only slightly faster than that of the overall population growth rate (Global Tracking Sustainability for All 2017, World Bank). The tendency has been to extend the grid incrementally, reaching towns in order of increasing capital costs, according to the International Energy Agency’s (IEA) World Energy Outlook 2017. The result is that 1.2 billion people still live in the dark edge and remain poor because, among other things, their lack of access to electricity hinders their inability to do work, follow professions, or enjoy communications that the rest of us take for granted. Many of these people live in poor neighborhoods that have sprouted around megacities in the developing world, while others live in isolated communities, where the grid never reaches.

Say Hello to the Microgrid

Innovation has advanced to the point where the edge, once seen as resource-poor when it came to electricity, can now be untethered and thrive with power. Progress makes it possible, and imperative, to finally bring light to the 15% of humanity that still need it. A combination of technology breakthroughs―which range from sustainable power generation in solar, wind, and hydrogen, to IoT―make it possible to create microgrids that not only provide electricity outside the traditional grid but can also give resilience to the grid and feed it power.

It was the advent of “untethered” computers, specifically mobile devices, that accelerated the penetration of computers. Entire communities that never had a computer leapfrogged into using Internet-enabled mobile devices to the point where, by the end of 2017, 50% of the world’s population now access the Internet, most by a smartphone.

An approach similar to the leapfrogging that mobile devices enabled for ubiquitous Internet penetration is required to make electricity, an essential resource for prosperity and well-being, available to all. For this, we need to build distributed sources of power, microgrids, that can operate independent of the centralized electric grid, anywhere. Fortunately, the new technology advances I referred to are coming fast to market in a manner that not only makes this possible, but desirable, from an economic as well as an environmental perspective. One of the final limitations to this, the availability of clean and affordable power 24/7, can be solved using the hydrogen in water, with technologies, such as Hydrogen 2.0.

The final piece to envision a real end to the hundred-year gap is to add brains to the system, literally. A January article from NetworkWorld points to the fact that “the Smart Electric Grid is actually one of the largest IoT deployments, with an estimated 500 million meters installed to date,” which is “expected to grow to 1 billion by 2020.” NetworkWorld further clarifies that the smart grid is “nothing but a network of electrical suppliers, which is managed by a system of digitally controlled interfaces that can dynamically alter the flow and supply of electricity in response to micro and macro changes in demand.”

Technologies in Concert

What all this means is that IoT and emerging distributed renewable energy technologies make microgrids the way to go when it comes to bringing power to everyone, everywhere. With these technologies working in concert, all kinds of power-generating systems can talk to each other, send, and receive electricity, cover the power limitations of each other, and efficiently manage supply and demand everywhere. Working in concert, these technologies can effectively end decades of difficult “peak management,” while making the entire power system as resilient as the Internet. Closing the 100-year gap finally appears to be within our reach.

If you’re attending this year’s Asia Clean Energy Forum in Manila, drop by and see my talk, “Closing the 100-Year Gap: Electricity in Every Home,” where I dive deeper into the subject. Hope to see you there.


Photo courtesy of Christopher Michel.
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