How will the energy market look like by 2023?

In today’s multifaceted energy world, a growing number of prosumer assets are increasing the complexity of power grids. Decentralized systems with solar generation, wind turbines, and electric vehicles provide promise for a decarbonized future, but also bring along challenges for both utilities and prosumers.

Distributed Vs. Centralized

The energy market is now moving away from centralized power plants and entering the era of distributed grids and peer-to-peer markets. Multiple elements of the energy ecosystem are evolving at a dizzying speed. We are seeing a very complex market emerging, where the distribution company needs to allow more and more renewables and flexible energy assets to be installed behind the meter, while maintaining a stable local grid. At the same time, prosumers who have installed such flexible assets want to optimize their energy flow to maximize the value of their investment.

SOLAR PRO ENERGY, RESIDENCE, CA

It’s very logical to manage electricity consumption so that you sell when it’s expensive and buy when it’s cheap. Artificial intelligence and deep learning algorithms can be applied in the energy sector in a very interesting way in this context. As the end users are becoming “prosumers”, smart devices are proliferating, big data is available for analysis, renewable energy sources are growing, and business models and regulations are adapting.

Combining it all together can help us get to the point where energy flows at the optimal timing, direction and volume. With artificial intelligence algorithms to determine when to produce, consume, store and trade energy, to the cost benefit of the end user, the service provider and the grid operator. With thousands of emerging energy communities, this vision might become clearer and perhaps even the reality, by the year 2023.

Creating the future.

No one knows what the future holds. However, More and more sustainable communities are currently under simulation and the first phase of the pilot is planned for two years, with possibility for extension. With over 100 million electric vehicles predicted by the year 2025, 1 billion prosumers (private and industrial), more than 10 billion smart devices — it’ll be a huge challenge to maintaining reliability and secured supply and grid stability.

These changes require a completely new operating paradigm, and there is no better test for technology than real life. New models are already being applied at various levels in Australia, California, Germany, Austria, Israel and many other countries around the world.

KIBBUTZ MAALE GILBOA, ISRAEL

In the USA, for example, by 2025 9% of the entire electricity generation will be generated “behind the meter” — by people’s houses. This figure is translated to $12 billion that won’t flow to the traditional power manufacturers — this change is expected to evolve and spread all over the world.

A perfect example for this is Kibbutz Ma’ale Gilboa in the northern area of Israel. The kibbutz is a microcosm of the future electricity market in the sense that is has all the variety of prosumers types: residential, commercial and industrial, agriculture etc., and it also has all the production capabilities: photovoltaic, wind, pumped storage etc.

Early believers will disrupt the energy market.

Examining the latest UN Intergovernmental Panel on Climate Change (IPCC) report shows the tremendous implications of every additional 0.5°C of global warming, and how important it is to accelerate the transition to a carbon-free economy.

I am confident this transition is possible and can be done even faster than expected but it is clear that it will require unprecedented collaboration between countries, companies, organizations and billions of people. I believe we are facing the most complex challenges in the history of our civilization, but if we focus our energy and act together, we will overcome it.