The Energy Sector of 2038

The Energy Sector of 2038

10/17/2018

Jessie Lai, Thuy Phi Le, Megan Lorenzen, Geof Cleveland, Theo Johnson

The largest challenge for the energy sector over the next 20 years will be managing disruption and finding the resources to build a new smart grid.  As new business models invert the relationship between energy producer, energy consumer, energy storage, the grid and utility company, both economic and political pressure will mount and governments at all levels and a federally supported framework for energy policy will successfully facilitate private/public partnerships that invest, develop, build and complete a new, smarter grid than ever before that facilitates an energy revolution by serving as a smart platform for a cleaner, more affordable, more profitable, more efficient and more resilient energy sector. It will be the success of sneaky business models that tip-toe around the dinosaurs of the energy industry and emerge and successfully transform the energy industry.

In five years, distributed renewable energy and storage will have percolated throughout the energy system, accounting for a majority share of energy production. In twenty years, we will see that trend continue until the grid is comprised primarily of variable renewables, balanced through an advanced grid and fully integrated battery technology.  Renewables will move beyond clunky rooftop or ground mounted panels. Solar, wind and low impact hydro technology will be built into the very fabric of our society. Road and roofs will double as solar panels, skyscrapers will leverage wind tunnels effect with micro turbines, and water systems will be populated with micro turbines to generate electricity from water flow. Energy storage will shift from lithium-ion battery to a more effective form of storage which overcomes the current limitations of physical transfer capabilities and charge times. Batteries of the future will also take many shapes and sizes. They will be both stationary units (in-house and around the grid) as well as mobile units like electric vehicles or personal electronic devices which can receive power (charge) or push power back to the grid at a moments notice.

To seamlessly integrate all of this advanced technology, a fully integrated smart grid with interconnected grid regions is absolutely essential. The smart grid of the future will be more versatile than any micro grid that exists today, able to handle an inconsistent and variable flow of electricity. The grid will also need to leverage AI and predictive technology to send signals to participants - not customers - throughout the value chain when excess energy is needed or is available for consumption. Everyone will have smart technology in their home that seamlessly communicates with the Grid AI. When the Grid AI dictates a need to buy, sell or consume energy, it will communicate to all the AIs within individual participant’s systems to automatically dictate how resources will respond to market need. Customized preferences will allow the grid to interact with those various systems without the market participant having to take proactive steps. Grid AI will eliminate many of the inefficiencies of the historic utility system by understanding where energy is being used, optimize delivery of supply, eliminate excess energy and increase the efficient distribution of storage resources.

One of the biggest changes this future of energy will bring is that each entity connected to the grid to be an active market participant - both a consumer and a producer. Participants will carry greater freedom and play a larger role in the energy sector than ever before. As this transition takes place, so too will the shift of who captures the value in the market. The energy sector of the future will boast never before seen levels of customization, performance (resiliency) and costs (efficiency). And, as fundamental market participants, residents and businesses will capture an increased portion of the value generated in the market.   

As part of this grid modernization, utility companies will no longer monopolize the market. The future grid platform will establish monetary exchanges that efficiently match energy producers, users and storers into mutually beneficial relationships, in turn encouraging wider adoption and opportunities for businesses to cash in on the energy revolution.  This energy sector revolution will also bring about affiliated benefits including national security, law enforcement and emergency management. It is very likely that In the event of a natural disaster, the grid will automatically shut off to protect you and your family from any energy accident such as arc-flash and auto-turn-on once the disaster passed. Your electronics, car or smart homes will never be out of energy – auto-charging through the grid. The available energy from grids will also be used to aid in natural disasters domestically or internationally with the ability to sell globally to countries with energy deficits.

By 2038, the entire nation will be plugged into the Great American Electric Grid. This fully integrated system will be able to withstand natural disasters, cyber attacks and conventional military strikes while allowing customers to seamlessly connect new energy sources or batteries into the grid.  Each customer is now an active participant in the energy sector ecosystem, producing energy from their onsite resources, consuming energy in their largely electrified home, business or electric vehicle, and supporting grid reliability by offering behind the meter storage resources. Using advanced artificial intelligence (Grid AI), the grid can now effortlessly conduct the symphony of grid resources sending signals to local energy management software controlling the production, storage and consumption of energy in a manner designed to maximize efficiencies at all steps of energy production and use.  It will also function as a monetized platform, matching energy producers, consumers and storers of all sizes into highly efficient market driven relationships.

Theo's additional comments:

While technological breakthroughs in storage capacity and continued lowering of costs for renewable energy production will help it garner a far greater percentage the energy market than it has today, a growing global population and increasing demand for energy will challenge efforts to convert completely to renewable energy.  If extreme weather events continue along with warming trends and a correlation to green house gases, the Republican Party will be forced to change its current energy policy posture and forge an alliance with the nuclear energy industry.   The next generation nuclear and fusion technologies that create less radioactive waste and help to lower the costs of energy production could bring about a reemergence in nuclear energy as carbon neutral means of producing huge quantities of energy to power a growing population demanding increasing quantities of electricity.  The natural gas that will be the fast growing stop gap source of energy over the next five years will be surpassed by nuclear over the next 20, as the fastest growing source of domestic energy.  Domestic usage of Natural Gas will level off and then gradually decline along with oil and coal; however, domestically extracted natural gas be an increasingly valuable export product sold to a developed world that will have largely moved past coal and continue reducing its dependence on oil.