Digitalization & Energy - IETA 23/Side-Event-Presentations/IET… · Digitalization &...

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Digitalization & EnergyGeorge Kamiya, Energy Environment DivisionCOP23 – 16 November 2017

IEA

©OECD/IEA2017

©OECD/IEA2017

Digital technologies are everywhere….

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Internetdatatrafficisgrowingexponentially,tripling overthepastfiveyears

Sources:Cisco(2017).TheZettabyteEra:TrendsandAnalysisJune2017;Cisco(2015).TheHistoryandFutureofInternetTraffic.

Connectivity trends

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Electricity use by data centres and networks

Sustainedefficiencygainscouldkeepenergydemandlargelyincheckoverthenextfiveyears,despiteexponentialgrowthindemandfordatacentre andnetworkservices

0

100

200

300

400

500

2014 2020

TWhDatacentres

Hyperscaledatacentres

Clouddatacentres(non-hyperscale)

Traditionaldatacentres

0

100

200

300

400

500

Moderateefficiencyimprovement

Highefficiencyimprovement

2015 2021

TWhDatanetworks

Mobile Fixed

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Buildings

Widespreaddeploymentofsmartbuildingcontrolscouldreduceenergyuseby10%to2040

0

10

20

30

40

50

60

70

Bysector Byenduse

PWh

Non-residential

Residential

Others

Appliances

Lighting

Waterheating

Spacecooling

Spaceheating

IEAanalysis

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Transport

Intelligenttransportsystemsareimprovingsafetyandefficiencyofallmodes,withthemosttransformativeimpactsexpectedinroadtransport

Roadfreight

• Digitalsolutionsfortrucksandlogisticscouldreduceenergyuseforroadfreightby20-25%.

• Digitalsolutionsincludeplatooning,routeoptimisation,anddatasharingacrossthesupplychain

Roadpassenger

• Automation,connectivity,sharing,andelectrification(ACES)todramaticallyreshaperoadtransport

• Impactsonenergydemanddifficulttopredict

• Automationandconnectivitycouldhalveordoubleenergydemand,dependingonhowtechnology,behavior,andpolicyevolve

©OECD/IEA2017

Industry

Energyusecanbeincrementallyreducedattheplantlevelbutwidespreaduseof3Dprinting,AIandroboticscouldheraldtransformativechanges

0

5000

10000

15000

20000

25000

Conventionalcomponents

AMcomponents

Tons

Metaldemandin2050

Aluminiumalloys Nickelalloys Titaniumalloys Fuelsavings

0

250

500

750

1000

1250

1500

1750

Slowadoption

Mid-rangeadoption

Rapidadoption

MillionGJ

Cumulativeaircraftfuelsavingsto2050

Source:Huangetal.(2016)

©OECD/IEA2017

Supply: oil and gas, coal, and power

Energycompanieshavebeenadoptingdigitaltechnologiesforyears,toincreaseproductivity,reducecosts,improvesafetyandenvironmentalperformance

Oilandgas

• Increasedproductivity,improvedsafetyandenvironmentalperformance

• Coulddecreaseproductioncostsby10-20%;recoverycouldbeenhancedby5%.

Coal

• Coalminingcanexpecttoseeimprovedprocessesandreducedcostsaswellasimprovedenvironmentalperformance

Power

• PowerplantsandelectricitynetworkscouldseereducedO&Mcosts,extendedlifetime,improvedefficienciesandenhancedstability

• SavingsofUSD80billionperyear

©Schlumberger

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Pre-digitalenergysystemsaredefinedbyunidirectionalflowsanddistinctroles,

The digital transformation of the energy system

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Pre-digitalenergysystemsaredefinedbyunidirectionalflowsanddistinctroles,digitaltechnologiesenableamulti-directionalandhighlyintegratedenergysystem

The digital transformation of the energy system

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Smartdemandresponsecouldprovide185GWofflexibility,andavoidUSD270billionofinvestmentinnewelectricityinfrastructure

Smart demand response

1billionhouseholdsand11billionsmartappliancescouldactivelyparticipatein

interconnectedelectricitysystems

Residentialsector

©OECD/IEA2017

EVssmartchargingwouldprovidefurtherflexibilitytothegridsavingbetweenUSD100-280billioninvestmentinnewelectricityinfrastructure

Smart charging of electric vehicles

EVsstandardvs smartchargingCapacityrequirement

150millionEVs

140GW

75GW

500millionEVs

300GW

190GW

StandardchargingSmartcharging

©OECD/IEA2017

Digitalizationcanhelpintegratevariablerenewablesbyenablinggridstobettermatchenergydemandtotimeswhenthesunisshiningandthewindisblowing.

Integration of variable renewables

Curtailmentofsolar PVandwind(EuropeanUnion)

7%

2040

Digitalflexibility

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DigitalizationcanfacilitatethedeploymentofresidentialsolarPVandstorage,makingiteasiertostoreandsellsurpluselectricitytothegridorlocally

Distributed energy resources

Blockchain couldhelptofacilitatepeer-to-peerelectricitytrade

withinlocalenergycommunities

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Building digital resilience

• Todate,cyberdisruptionstoenergyhavebeensmall

• Butcyber-attacksarebecomeeasierandcheaper– malware,ransomware,phishing/whaling,botnets

• Digitalizationalsoincreasesthe“cyberattacksurface”ofenergysystems

• Fullpreventionisimpossible,butimpactcanbelimited:- Raisedawareness,cyberhygiene,standardsettingandstafftraining- Coordinatedandproactivepreparationbycompaniesandgovernments- Designdigitalresilience intechnologiesandsystems

• Internationaleffortscanhelpraiseawarenessandsharebestpractices

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Managing privacy concerns

Source: Newborough andAugood (1999),“Demand-sidemanagementopportunitiesfortheUKdomesticsector”(reproducedcourtesyoftheInstitutionofEngineeringandTechnology).

©OECD/IEA2017

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

1. Builddigitalexpertisewithintheirstaff.

2. Ensureappropriateaccesstotimely,robust,andverifiabledata.

3. Buildflexibilityintopoliciestoaccommodatenewtechnologiesanddevelopments.

4. Experiment,includingthrough“learningbydoing”pilotprojects.

5. Participateinbroaderinter-agencydiscussionsondigitalization.

6. Focusonthebroader,overallsystembenefits.

7. Monitortheenergyimpactsofdigitalizationonoverallenergydemand.

8. Incorporatedigitalresiliencebydesignintoresearch,developmentandproductmanufacturing.

9. Providealevelplayingfieldtoallowavarietyofcompaniestocompeteandserveconsumersbetter.

10. Learnfromothers,includingbothpositivecasestudiesaswellasmorecautionarytales.

No-regrets policy recommendations

©OECD/IEA2017

Digitalization: A New Era in Energy

• Theenergysystemisonthecuspofanewdigitalera

• Thisfirst-of-its-kind“DigitalizationandEnergy”reportwillhelpshinealightondigitalization'senormouspotentialandmostpressingchallenges

• Butimpactsaredifficulttopredict;uncertaintyintechnology,policyandbehaviour

• Muchmoreworkneedstobedone…

• NextstepsforIEA,especiallytofocusonhighimpact,highuncertaintyareas:- Automation,connectivity,andelectrificationoftransport- Electricityandsmartenergysystems- Digitalizationanddecarbonisation

©OECD/IEA2017

iea.org/digital

digital@iea.orgIEA

©OECD/IEA2017

Digitalization & Energy

1. Introduction:Aneweraofdigitalizationinenergy?

2. Energydemand:transport,buildings,andindustries

3. Energysupply:oilandgas,coal,andpower

4. System-wideimpacts: fromenergysilostodigitally-interconnectedsystems

5. Energyuse bydigitaltechnologies

6. Cross-cuttingrisks:cybersecurity,privacy,andeconomicdisruption

7. Policy,includingno-regretsrecommendations

iea.org/digital

©OECD/IEA2017

Digitalization and trucks

Digitalsolutionsfortrucksandlogisticscouldreduceenergyuseforroadfreightby20-25%

-80%

-60%

-40%

-20%

0%Energydemand GHGemissions

Netchange

Systemicmeasures

Vehicleefficiency

Fuelswitching

Approximatecontributionofdigitaltechnologies

Source:IEA(2017).TheFutureofTrucks:Implicationsforenergyandtheenvironment.

©OECD/IEA2017

Impacts on road transport energy demand

Roadtransportenergydemandcouldhalveordouble fromautomationandconnectivitydependingonhowtechnology,behavior,andpolicyevolve

-80% -40% 0% 40% 80% 120%

I)Optimisticscenario:"Haveourcakeandeatittoo"

-80% -40% 0% 40% 80% 120%

II)Pessimisticscenario:"Dystopiannightmare"

Heavy-dutyvehicles

Light-dutyvehicles

Energyintensity

Traveldemand

Energydemand

Totalroadtransport energy

• Automation,connectivity,sharing,andelectrification(ACES)todramaticallyreshapemobility

• Impactsonenergydemanddifficulttopredict

Source:Wadud,MacKenzie andLeiby (2016),“Helporhindrance?Thetravel,energyandcarbonimpactsofhighlyautomatedvehicles”.

©OECD/IEA2017

Oilandgas

• Increasedproductivity,improvedsafetyandenvironmentalperformance

• Productioncostsreducedby10-20%;recoverycouldbeenhancedby5%.

Supply: Fossil fuels

Energycompanieshavebeenadoptingdigitaltechnologiesforyears.Digitalizationhelpstoincreaseproductivity,reducecosts,improvesafetyandenvironmentalperformance.

Coal

• Coalminingcanexpecttoseeimprovedprocessesandreducedcostsaswellasimprovedenvironmentalperformanceandsafety

0% 5% 10% 15% 20%

Conventionaloil

Conventionalgas

Unconventionaloil

Unconventionalgas

Tightoil

Shalegas

%increaseinresources

Oil

Gas

©OECD/IEA2017

Supply: Electricity generation and networks

DigitalizationcouldsavearoundUSD80billionperyear,orabout5%oftotalannualpowergenerationcosts

Power

• PowerplantsandelectricitynetworkscouldseereducedO&Mcosts,extendedlifetime,improvedefficienciesandenhancedstability

0

10

20

30

40

5%lowerO&Mcosts

Efficiency:5%more

electricityoutputperunitoffuel

Efficiency:5%lowertotalnetworklosses

5-yrlifeextensionforpowerplants

5-yrlifeextensionfornetworks

USDbillion(2016) OPEX CAPEX

©OECD/IEA2017

Data centres

Continuedgainsinefficiencycankeepenergyusebydatacentresandnetworkslargelyincheckoverthenextfiveyears.

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50

100

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200

250

2014 2020

TWhWorld

Hyperscaledatacentres

Clouddatacentres(non-hyperscale)

Traditionaldatacentres

0

1

2

3

4

Currenttrends

Improvedmanagement

2014 2020

TWh

India

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Data transmission networks

0.01

0.1

1

10

100

2G 3G 4G

Fixed Mobile

kWh/GB

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1500

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3000

3500

2010

2011

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2021

EB/year

Mobile

Fixed/WiFifrommobiledevices

Fixed/WiFifromWiFi-onlydevices

Fixed/wired

©OECD/IEA2017

CDA Design & Policy Principles for Energy Efficient Connected Devices

Amongotherthings,theprinciplesaddressnetworkedstandbypoweruse.

• DevelopedbytheG20NetworkedDevicesTaskGroup,consistingofindustryandgovernmentrepresentatives.ThePrinciples havetwofocuses:

• TheCDAVoluntaryDesignPrinciplesprovideguidanceonthekeyfeaturesofenergyefficientconnecteddevices,networksandcommunicationsprotocols- forusebydesigners,manufacturersandprotocolsauthors

• TheCDAPolicyPrinciplesencourageacommonglobalframeworkforthedevelopmentofgovernmentpoliciesandmeasures- forusebypolicymakers

• Availableat:http://cda.iea-4e.org/cda-principles

©OECD/IEA2017

Using digitalization for compliance and evaluation

• China isattheforefrontofusingnewtechnologiesformanagingtheirstandardsandlabellingprogramme

• WhyaQuickResponse(QR)code?- HalftheChinesepopulationusessmartphoneapps- Notpatented,lowcostandeasytouseonexistingenergylabelforappliances

• Benefits:- Guidesconsumerstomakebetterinformeddecisions- Supportslocalcomplianceauthorities,reducingcompliancecostsandsimplifyingdatacollection

- Helpsinthemonitoringandevaluationoftheeffectivenessoftheprogramme

©OECD/IEA2017

Energy use by digital technologies - overview

Cloud(datacentres)

NetworkInfrastructure

TraditionalNetworkConnectedDevices

IoTDevices

Mobiledevices(smartphones,tablets)

Computers(PCs,laptops)

Mobiledevices(e.g.smartTVs,set-topboxes,etc.)

SmarthomeSmarthealthSmartfactorySmartmobility…

Battery/self-powered

Mains-connected(e.g.smartlighting,

smartappliances,etc.)

Source:4ETCP(2016)EnergyEfficiencyoftheInternetofThings

©OECD/IEA2017

The number of installed connected devices may triple by 2020

4billiondeviceswereinstalledworldwideintotalbytheendof2016.Thesedevicesareenablingnewservicesthatmayenhancequalityoflife,butsmartdevicesarenotnecessarilyenergy-efficient.

Global household connected devices installed by the end of 2016 and forecasted for 2020

0

5

10

15

2016 2020

Billions

Smart lighting

Smart appliances

Home automation

©OECD/IEA2017

The popularity of smart appliances is quickly growing

SalesvalueintheEUgrewbytwo-and-halfbetween2015and2016.

Sales value of large smart home appliances in the European Union, 2015-16

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50

100

150

200

250

Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2015 Q2 2016

EUR Millions

Other

Space cooling equipment

Clothes washers

©OECD/IEA2017

Smart devices enable new efficiency opportunities

Butmanyoftheseopportunitiesaredrivenbycustomerbehaviour,whichisnotalwaysefficient.

Examples of energy efficiency enabled by household connected devices

Gridlevel

Smartmeters

Time-variantpricing

Loaddisaggregationtechnology

Householdlevel

In-homedisplays

Smartthermostats

DevicelevelIncreasedenergyuse

awarenessbyconsumers

Increasedlikelihoodofappropriatedeviceset-

up

Feedbacktomanufacturerson

consumerbehaviour

©OECD/IEA2017

Smart meters installations are quickly accelerating

Smartmetersdonotdirectlyresultinenergysavingsbutenhanceorenableothersavingsopportunitiesbymeasuringhouseholdelectricityusefrequentlyenoughforhouseholdoccupants(ordevices)torespondinrealtime.

Global contracted installations of electricity smart meters

0

200

400

600

2012 2013 2014 2015 2016

MillionsChina

Asia Pacific (excluding China)

Americas

Europe, Middle East and Africa

©OECD/IEA2017

A greater share of appliance electricity use is network-enabled

Thegrowthinnetwork-enableddevicespresentsopportunitiesforsmartdemandresponsebutalsoincreasesneedsforstandbypower

0

1 000

2 000

3 000

4 000

5 000

6 000

2010 2015 2020 2025 2030 2035 2040

TWh

Network-enabled

Not connected

Household electricity consumption of appliances and other small plug loads

©OECD/IEA2017

Connected devices comes with a hidden energy price tag

Networkedstandby,theenergyusedtomaintainthedevice’sconnectiontothewidernetwork,isalsooftenaconnecteddevice’sbiggestdrawonpower.

Average standby power of household connected devices per unit

0.0

0.5

1.0

1.5

2.0

2.5

Smart LED lightbulbs

Gateways Sensors Actuators Gateways Cameras Appliances Gateways

Smart lighting Home automation Smart appliances

Watts (W)

©OECD/IEA2017

Digitalization: A New Era in Energy?

• Digitalizationiseverywhere;digitalandenergyworldsareintersecting

• Allenergydemandandsupplysectorsarefeelingtheeffects

• Fundamentaltransformationofelectricity– “smartenergysystems”

• Emergingrisksneedtobemanaged,includingbuildingdigitalresilience

• Governmentpolicydesigniscritical;10no-regretsrecommendations