The Energy Market: more agile than you would ever know
You don’t associate the energy industry as nimble and home to start ups, but you’d be wrong.
Many would perceive the Australian energy industry as monolithic and mature; wedded to generation and distribution processes that are outdated in a world where clean energy is rapidly growing in prominence.
But this perception is again inaccurate. Globally, and particularly in Australia, business is walking the talk on energy innovation – and it is cause for excitement.
The energy transition is happening
In recent years, negative sentiment has surrounded much of the energy industry.
There is a growing realisation that over the next thirty years, the assets that provide most of our dispatchable power are going to age out with policy direction, on what’s going to fill that gap and how the transition will be managed, hard to fathom.
One thing we do know is this energy transition will result in multiple sources of flexible energy and a more decentralised market. Already businesses and individuals in Australia are looking to reduce their reliance on traditional generation sources by enthusiastically embracing solar, wind-powered energy and storage. On my global visits I get regularly quizzed on South Australia’s Hornsdale Power Reserve and its Tesla 100MW battery.
The challenge now lies in ensuring this new, decentralised energy market of tomorrow is economically viable, reliable and sustainable – and that is exactly what our energy giants are trying to do today.
Energy industry leaders are not attempting to future-proof themselves through secretive, inward-looking product and service development schemes. Rather, they are being openly collaborative, partnering with a multitude of start-ups in the energy space, as well as institutions of higher learning showing how market-leading research can benefit multiple parties.
These partnerships will help manage the energy transition from centralised energy sources to a decentralised network.
I have had the pleasure of viewing many of these collaborative efforts and the results have floored me.
TransGrid and the University of New South Wales teamed up just last year to install an industrial Tesla Powerpack battery on the main campus. Linked to UNSW’s Old Main Building electricity grid and solar panel system, the battery is able to store 500 kilowatt hours of electricity for use during peak hours, reducing usage and saving money for the university.
If that was the only benefit of the project, it would be worth it. But the project will also allow TransGrid and UNSW to study energy demand management technologies at scale, providing ideas on how to further optimise decentralised energy resources.
The partnership of corporations and start-ups is just as exciting. Two Australian energy companies have joined other global luminaries supporting a global accelerator program called Free Electrons that selects a group of energy start-ups every year to receive the direct support of established energy providers.
The breadth of capabilities of these start-ups is outstanding. Some offer new and efficient solutions for meter data management. Others offer green energy alternatives or services to consumers, preparing corporations and customers to better manage the two-way flow of energy that will come with increased decentralisation.
These kind of partnerships are a global trend. I recently visited the EcoLabs Centre of Innovation for Energy at the Nanyang Technological University in Singapore where energy giants, SMEs and start-ups are working together to create green technology innovations and make them market-ready.
Innovations from many start-ups are being trialled and moving to commercialisation and value is ultimately accruing to consumers through these deployments. In some cases it may not be immediate but in the long term it will. Hydrogen energy applications and virtual power plants may be in this bucket with a number of trials kicking off across the country.
It sounds crazy how far we come – but deployment of flexible sources of energy paired with agile and innovative technologies are going to play a key role if we are to overcome structural changes in our energy market in an orderly manner.
Based on what I’ve seen in action, one of the keys to success will be to create and leverage these new technologies through collaboration created through dynamic partnerships.
When you’re sick of reading about the ups and downs of policy, turn your eyes towards innovation. It’s where the future lies.
View the full program on The Next 5 Years.