IBM’s latest insights on facilitating the energy transition

While COP27 made progress on many issues, including the establishment of a loss and damage fund, it also made it clear to us that more needs to be done to close the emissions gap and that we urgently need to translate pledges into concrete action. Added to this is the need for companies to continue to manage the impact of the pandemic on supply chains, rising living costs and rising energy costs in Europe. We recognize these are challenging times – what some are now calling the “polycrisis”.

In 2023, energy-focused governments and private companies face a difficult choice: to prioritize addressing the immediate energy crisis – and its associated costs – or focus on the existential and urgent threat of climate change. Fortunately, the answer might be that we can and must focus on both. If 2022 was “the year of consequences,” then 2023 must be “the year of action.”

The EU has set itself the ambitious goal of achieving carbon neutrality by 2050, with concrete plans to enable the energy transition, including its Action Plan on Digitizing the Energy System, published last October, which explicitly recognizes the importance of technological change in this transition.

Companies that are active in the energy sector and want to reduce their energy consumption have both the power and the opportunity to advance the fight against climate change in parallel with political processes.

Four steps to implementing plans:

1. Open the energy market so that all energy consumers can participate. Empowering all consumers to participate in energy systems will help create new energy services and facilitate energy flows. Large energy consumers – such as building owners, real estate companies and supermarkets – can help to adjust heat and electricity consumption and support grid balancing (e.g. by choosing to use less or to switch their ventilation, cooling and freezing systems to the grid). make available if the supply is low). In the city of Copenhagen, IoT, artificial intelligence (AI), blockchain and the cloud have enabled integration into the energy ecosystem to drive real-time smart grid optimization.

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2. Rethink system orchestration for decentralization and decarbonization. The energy transition will be a cross-industry effort, building on new technologies, including systems that accurately track energy consumption, intelligent appliances and energy-efficient computing platforms. The power of data, along with technologies like IoT, AI and blockchain running on open cloud platforms, can create these types of ecosystems, bringing parties together virtually, quickly and at scale in a trusted and secure manner.

3. Provide trust, resilience, and security. With the digitization of complex industrial systems, trust, resilience and security become even more important. With a growing number of distributed, connected devices and assets being used in the system, ensuring cybersecurity risks are better managed will be crucial. While increasing digitization increases these risks, technology tools are also crucial to improve security processes, e.g. B. predicting performance or preventing asset failures. This means that organizations must effectively address high-risk cyber-critical assets and applications with an advanced level of cybersecurity, but also apply a broader holistic cybersecurity foundation across the supply chain. Regulators have a key role to play in this area, promoting risk-based and principle-based cybersecurity policies and leveraging recognized international standards and best practices.

4. Serving social justice, just transition, equal participation and economic prosperity. Our energy systems should be human-centric, engaging citizens in the transition and encouraging participation through better rewards. Digital tools can help increase consumer awareness, optimize consumption and monetize flexibility. At a time when energy costs have become a critical issue, we must ensure equitable access and not unfairly disadvantage certain communities.

However, technology is not ineffective. Greater use of computing power, data centers and networks requires an increase in electricity generation, which is why companies must take measures to improve the energy efficiency of their digital infrastructure and develop new, more efficient devices. BBVA, for example, realized a 50 percent reduction in carbon emissions and energy consumption in its data center processors.

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last words

An effective energy transition will depend on collaboration between all the key players in our economy – energy companies, technology providers, governments and consumers. 2023 is in our hands, and by using data and technology to support the shift to renewable energy and reduce our greenhouse gas emissions, we can ensure the energy transition is at the forefront of doing business.

About Ana Paula Assis


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