The new energy landscape: Why IoT matters


We are in the midst of a major energy transformation. Our world is becoming more electric, more connected and more distributed and this growth is projected to continue exponentially, with electricity consumption expected to increase by 80% in the next 25 years.

This new world of energy will be defined by the trends of decarbonisation, digitisation and decentralisation, shifting the global focus to technologies that create a cleaner, more reliable and future proof grid infrastructure.

The impact of these mega-trends are broader than we ever thought possible. A distributed infrastructure model is emerging, coupled with an influx of new energy resources like renewables and often changing load patterns according to different regional generation capacity evolutions.This is adding complexity and putting more demand on an already outdated grid infrastructure that was not designed to handle the variability associated with today’s level of demand.

At the same time, the industry has evolved from a traditional value chain to an interconnected business model where end-users now interact with the grid.

A key hurdle of this new world of energy is as a result of the evolving role of the grid operator. Grid operators now take the brunt of the impact of this industry disruption. They are forced to manage the intermittency associated with a higher penetration of renewable energy, more demanding regulatory frameworks requiring increased resiliency and efficiency, along with new market evolutions such as increased customer/prosumer engagement and their interface with the utility.

For grid operators to be successful in the digital age, they must undertake a digital transformation.

Keeping pace with the evolving grid

The grid became smarter by incorporating technologies such as smart meters, insights driven automation, and remote monitoring and management tools. For example, the smart grid incorporates sensors that monitor grid tendencies and evaluate grid activity to enhance reliability and resiliency. In turn, automated algorithms help to evaluate how those tendencies can be optimised in order to cut energy spend, drawing in real-time insights from external factors such as weather data to make automatic changes to distributed resources.

All the while, those sensors are gathering data that is automatically stored and sorted within an operator’s system to allow the system to learn without impacting operations. Software applications can also be applied to the smart grid for remote monitoring and control, allowing further autonomy.

The smart grid as it stands has served as a great foundation that has turned the grid into an asset and greatly increased the level of reliability and efficiency experienced by end-users. However, as we look toward 2025, when analysis suggests the traditional centralised model will be completely transformed by distributed energy, we now know we’ll need a more modern and even more intelligent grid.

The next wave of innovation for the grid will come from the Internet of Things (IoT). The latest advancements in IoT go beyond just connecting smart devices, helping build value to reach every level of the grid, and support a grid operator’s digital transformation. Enabling a new type of framework that connects intelligent devices with real-time control, open software and analytics and services – this advancement in IoT increases collaboration with the new actors in the grid ecosystem to help the entire system work more efficiently.

Providing a strong digital backbone, we can now leverage this IoT framework to maximise the benefits of intelligent devices like smart meters and sensors to increase the grid’s operational efficiency for smarter asset management strategies. More advanced edge control provided by this framework extends the reach of data and enables high-performance grid efficiency with real-time reaction and management across all levels of the distribution network.

Additionally, an IoT framework further maximises the actual value of generated data, enabling more insightful analytics and providing better applications and services that can be customised for localised solutions and better overall decision making.

A key benefit of moving to this framework model comes in additional flexibility. Flexibility becomes critical when looking to ensure a future-proof system. We’re now in a period of great transformation and innovation, meaning new technologies are being implemented rapidly, changing the way grid technologies interact incrementally.

By enabling efficient real-time digital tools and a foundation of open data management, we’re now able to use the best of the information technology (IT) and operational technology (OT) worlds to tackle the massive data deluge created by smart, grid connected technologies and the increased need for software and systems integration platforms to improve grid performance.

This level of flexibility better manages connected consumers, or prosumers, enabling utility engagement for efficiency solutions such as demand response, residential energy storage and electric vehicles. This model also better manages the two-way information flow between the utility and customers, adding insights into consumer behaviour to enhance operations.

The new energy grid operator

As we move to a new system of grid management provided by IoT, the role of the grid operator will also need to change. The new world of energy means the operator is facing new and greater safety, reliability and security challenges. The impact of distributed resources transforms the planning and operations functions, making the management of various and disparate power sources a much more complicated task. Additionally, connected technologies inherently increase the risk of cyber threats.

Thankfully, IoT provides just as many personnel benefits as it does infrastructure benefits. It gives operators a powerful tool that provides a better view into the entire system and thus improves grid observability. This arms operators with more accurate situational awareness, reinforced network stability and voltage management performance, and ultimately helps them improve operational performance. Additionally, IoT allows grid operators to leverage the best capabilities

Additionally, IoT allows grid operators to leverage the best capabilities from the cloud, big data and analytics to intelligently manage more energy data from multiple sources and incorporate new asset management models with predictive maintenance. This also enables new business models that support a cleaner grid, such as microgrid-as-a-service and net metering, simpler and easier to implement on a large scale.

IoT can actually strengthen grid security applications by providing greater data protection and integrity, in addition to more advanced authentication and authorization protocols. IoT can also allow operators to more easily perform patch management, backup, restore and recover procedures and incident management. The combination of these upgraded services helps grid operators demonstrate a stronger risk mitigation strategy and better protect the overall health of the assets under their control. IoT will also help grid operators become more active in overall system management and react more quickly and seamlessly to new regulations and policies.

The combination of these upgraded services helps grid operators demonstrate a stronger risk mitigation strategy and better protect the overall health of the assets under their control. IoT will also help grid operators become more active in overall system management and react more quickly and seamlessly to new regulations and policies.

This will ensure that grid operators can adapt to market mechanisms and add new services to meet future demands. IoT technologies have enormous potential for building a cleaner and more reliable grid, and they are available to adopt today. By looking at the applications for IoT beyond just the connectivity of devices, IoT can become both a comprehensive framework and guiding path toward implementing new and innovative digital technologies. These will increase the flexibility of grid operations and make the entire grid ecosystem, including the operator, more efficient and reliable. Looking closely at the convergence of IT and OT, every level of the grid can be transformed and new services and applications can be implemented. MI




Vincent Petit started his career in Schneider Electric in France, running international power projects across the globe, mainly in Middle-East and Africa. In 2011, Vincent moved to Russia where he led the solution business operations for the CIS zone, including Russia, Ukraine and Kazakhstan. Since 2015, he has run the global energy automation business, a ffast-growingbusiness at the heart of smart grids, made of a very diverse and specialised team across all geographies, including marketing, research and development and operations.