Secure energy future can't be built by private sector alone

If today’s release of the International Energy Agency’s (IEA) World Energy Outlook 2011 was the “bad news” part of energy coverage for today, Oracle’s new “Future of Energy” report leans toward the “good news” side.

While acknowledging the many energy and sustainability challenges facing us, the Oracle study focuses on the emerging technologies and strategies that can help address those challenges. It sees the smart grid and electric vehicles, in particular, as necessary and promising developments for building a secure energy future.

“The smart grid will provide utilities with a new wealth of data intelligence and granular insight into customer usage patterns, into near-real-time status of their distribution network and allow better planning of the conventional and renewable energy supply chains and optimization of the network assets,” said Bastian Fischer, vice president of industry strategy for Oracle Utilities. However, he added, “Although good progress has already been made by many countries, we still have a long way to go to make the smart grid a reality.”

“It is one of the most important measures,”  agreed Hans Martens, chief executive of the European Policy Centre, “because it can help achieve goals without changing lifestyles, and sometimes with relatively small investments.” He added that information and communications technologies (ICT) enabled by a smarter grid will help create a “win-win situation” that can reduce the use of carbon-based fuels, cut emissions, save consumers money and promote innovation and new jobs.

Oracle prepared the “Future of Energy” in partnership with The Future Laboratory consultancy. Together, the two organizations assembled a panel of experts from across Europe, the Middle East and Africa (EMEA) to look at how the European Union can meet its 2050 goal of cutting carbon emissions by 85 to 95 percent, compared to 1990 levels, by 2050. The panel considered the impacts of not just technology but of commercial investment, consumer engagement and political leadership as well.

“Demand for energy continues to rise unabated,” the report’s introduction states. “Yet it does so against huge challenges: the long-term environmental sustainability of fossil fuels, vulnerabilities in the energy supply chain and volatility in energy markets. Left unchecked, these could have serious social, economic and environmental impacts worldwide. An energy revolution to rival the rollout of electrification in the 20th century is required.”

By 2050, for example, global electricity demand is set to soar by 115 percent, more than doubling today’s demand.

“The scale of the energy challenge means action must be taken now to secure our future energy needs in a sustainable fashion,” the report states. “The solution lies in the decarbonization of our industry and society. To achieve this we need to develop smart grids capable of integrating clean technologies — such as wind and solar energy — and also be able to efficiently align power supply and demand.”

In a noteworthy echo of the sentiment expressed by the IEA, the Oracle study did acknowledge that decarbonizing industry and society isn’t a job just for the private business sector.

“The complexity and cost associated with the deployment of the smart grid means that market forces alone are insufficient to drive the necessary investment,” it stated. “Governments must take the lead, putting in place the appropriate policy and regulatory framework and ensuring the costs and benefits of investment are aligned.”