Renewable energy: a hidden and inexhaustible source of economic and environmental gains.
Did you know that over a billion people live without electricity? Most of these people live in rural areas in Sub-Saharan Africa. While they have to do without any electrical power at all, the rest of the world is using more and more electricity every year. Where still, most of it is generated by unsustainable non-renewable sources like coal, natural gas, and petroleum. The problem of energy is twofold. On the one hand, many have to live without any energy; meaning they are basically isolated from the rest of the world. This prevents advancements that are key to eradicating poverty like education and health care from reaching these areas. On the other hand, only a small portion of the increasing amount of energy being used by the rest of the population comes from renewable resources. For both cases, It is an unprecedented opportunity for a huge arc of stakeholders
According to the Paris Climate Agreement, global emissions in 2050 must decrease by 20-60 percent compared to 1990, in order for the global temperature to remain below two degrees over the course of the 21st century. This measure against climate change has substantial implications for different sectors of the energy system.
One of the major challenges with renewable energy, in contrast to fossil fuel energy, is that renewables might be at some level unpredictable and variable. For example, at night, there is no solar power and the wind does not always blow when there is energy demand. However, in energy systems, energy supply and demand must match at all times. To increase the share of sustainable energy in the total energy offer, there must be solutions in place to ensure supply-demand matching. Three of the most important solutions are demand response, storage devices, and sector coupling. These three areas are at the heart of the innovation process and a source for companies with disruptive solutions. Also, we will not forget the cost aspect either. We are still at a time when it is necessary to give a significant economic incentive in order to staff the adoption of alternative energy sources. Therefore, the solutions must be cheaper than the alternatives available today.
Let's discuss these solutions a bit more. Demand response is about energy consumers actively collaborating with energy suppliers by shifting their energy consumption. For example, energy suppliers can nudge their consumers to charge their electric vehicles when energy availability is high by offering discount rates. This is both profitable for the consumer and supplier, who can offer energy directly when available. However, this approach also has its disadvantages, as it is impacting the comfort of consumers and dependent on their behavior.
Storage is an alternative solution for supply-demand matching. Innovation in storage devices such as batteries can make it possible to store surplus energy at times when there is more energy than needed and get discharged when the demand is higher than the available power. Unfortunately, though, storage is still too expensive to be used and scaled for larger energy applications.
Lastly, sector coupling is about converting surplus electricity to either gas or heat. This way, renewable electricity can be used to serve heat demand or gas demand, when there is not enough electricity demand. However, sector coupling is not the most efficient way to use surplus electricity, as the conversion also causes substantial energy loss.
Now that fossil fuels are running out and legislations, on for example carbon, are changing, businesses need to anticipate the future. Through anticipating revolutionary changes in the energy sector, they are securing their existence and also anticipating ways to stay profitable, while contributing to reducing CO2 emissions. Luckily, using clean energy is now often integrated among the core objectives of most businesses including IT business, manufacturing and inventory, transportation, and many others. For example, since 2007, Google has attempted to keep its operations carbon-neutral using renewable energy to supply its data servers in an attempt to become a green and sustainable business. This change in the approach of businesses does not stand alone, but is part of a bigger changing future electricity network, also called smart grids.
The emergence of distributed energy generators, electric vehicles, all types of storage, and new business models, such as blockchain and smart metering are all examples of the new elements in these smart grids. Another important element of a smart grid is the electricity market. The electricity market has a lot of faces and applications and could be examined both from the local and global perspective.
On a national and global level, there is an inspiring business case with the attempt of GCC's Emirates to significantly reduce economic dependence on oil by adopting both the mindset of Sustainable development and a responsible and balanced economy. For example, Dubai is stated to be the city with the lowest carbon footprint in the world by 2050. Back in January 2012, HH Sheikh Mohammed bin Rashid Al Maktoum announced the launch of the Mohammed bin Rashid Al Maktoum Solar Park and the Emirate of Dubai has become an international pioneer in developing clean and renewable energy sector.
Not far from Dubai, Israeli-based company SolAround managed to develop a proprietary solar PhotoVoltaic (PV) p-PERT cell technology positioned to revolutionize the world of renewable solar energy. SolAround is a high-efficiency, fully-bifacial, solar cell technology that increases by 20%-40% the efficiency compared to mono facial solar panels, and by 10% compared to the best PERC- Bifacial solar panels per KWp installed today, at the same cost of cell production, decreasing by that the cost of solar energy (LCOE, kWh) by up to 30% vs. mono facial systems in the market, and by 10% to 15% when compared the most advanced bifacial PV solutions in the market. Fascinating, isn’t it?
Quite a few times investments in the fields of sustainability are perceived as less attractive since much of its contribution is "swallowed" up by the environment, and not necessarily captured by the ROI factor. Well, I do not agree with that. More than that, I am convinced that many of these SDG 7 related opportunities are of exponential potential ROI and have also a tremendous environmental impact.
Let's for a second imagine a situation where the entire Dubai's solar park was equipped with the SolAround technology. Let's now imagine a park with an area ten times that. Such a combination is a power that requires a lot of resources, no doubt, but the benefit and contribution of such a move can bear fruit for many generations to come. In this context, the concept of a new Middle East has many meanings.
All in all, investing in renewable energy has a lot of purposes and a lot of challenges. At the technological level, many aspects are still unresolved and in running the required resources these are huge investments needed to make significant moves. In addition, there is the high-risk component and little patience for investors to wait for fruits that are by definition long term, yet I am confident that the SDG 7 will be achieved through uncompromising leadership, and the courage to invest the necessary resources by visionary groups of stakeholders.