Andrew Jones of S&C Electric calls for better long-term planning to develop a new energy system
Here at S&C we're celebrating our 100th anniversary, and looking back over the last century there are of course massive differences in the world of technology and innovation bewteen now and then. By looking at industry expansion and the strategies that drove them, we can learn much that will ensure the smart grid industry continues to grow at a robust pace that sets a solid foundation for future success.
First, let us consider the polar opposites with the electricity grid and the telephone - consider where each were then, and where they are now. The electricity grid infrastructure is almost exactly as it was a century ago, whereas the telephone industry has changed beyond all recognition.
The electricity grid is, however, expected to manage the incredible demand put upon it in the 21st century with the plethora of devices plugged in, continuously sapping energy on a scale never envisaged at its creation.
This is similar in some respects to how the internet has evolved; it wasn't initially established to carry the data required as millions of people stream episodes of Desperate Housewives concurrently. The content and network load is the near equivalent of trying to flush a swimming pool down a bathroom sink, and as a result we're beginning to see consumer experience lessen without significant investment in rebuilding infrastructure to accommodate the delivery of such vast swathes of material.
The ability to stream content online is now seen as a utility service, and complaints constantly arise when it goes down or fails. We're in danger of seeing the same for energy unless we rethink the growth and consumption models driving the industry and consumer use.
The telephone industry has changed in a different respect, however, with the advent of the mobile phone, tablet PCs and the myriad of platforms, apps and paraphernalia that goes with it. These devices and hardware have developed alongside the underpinning architecture, meaning they are able to function (relatively) smoothly on the infrastructure, and the industry has grown exponentially with it as a result.
Consider also a farmer ahead of the industrial age, who was ploughing his fields with horses. Ask him what would make his life easier and his reply would almost certainly have been 'another horse' rather than 'a tractor'; he'd not have conceived of the latter, and the former would be the most sensible way to increase productivity.
The energy storage industry is facing similar dilemmas right now on how to move forward robustly, sensibly and effectively, taking into account a blend of the above analogies. We're operating on the incumbent (outmoded) infrastructure, yet are in need of a tractor, not another horse, to make the transition from theoretical solutions to practical, workable, comprehensive industry and consumer offerings.
However, the industry needs to heed warnings that what has helped other markets might not necessarily replicate the success in this one - a dramatic and obvious example to return to being the mobile industry. Here we see consistent short-term growth strategies and short-term innovation to cope with the short-term demands from gadget-hungry consumers who change handset every year with each new hot upgrade. This has driven the industry beyond all recognition from that 10 years ago (let alone 100), and has got to the point where being 'always on' and always contactable is almost a paradigm of 21st century life.
The energy industry cannot afford such short-termism to affect its own growth, innovations and ultimate implementation. The planning needs to be for the long term - people are not going to be switching suppliers each year, and the energy storage and solutions companies are not going to be refreshing entire product and service portfolios every two years.
We need to avoid industry growth comparisons with the mobile sector and how its infrastructure rolled out, otherwise we'll always pull up short and perceive growth and genuine innovation as stagnation. We're developing a technology which needs to relevant and functional in 40 years as well as next year.
Ultimately, what is needed for growth is for the same people who have driven the electronic and computer age to be those driving the development of the smart grid sector. We need the technology strategists, developers and innovators to lead the growth of the industry, not those who control the pricing and regulation - the latter play a role, and will undoubtedly steer the industry, but they should not drive it.
These are exciting times for the smartgrid and clean tech industries, but one of the biggest challenges right now is managing expectations from those with an interest in them - from sociological, environmental and, of course, financial perspectives.
We need to challenge the belief that this sector will blossom with the slightest drop of rain, and instead reiterate the fact that we need long-term planning, with long-term infrastructure to properly lay down the foundations of a successful, long lasting success story for all concerned.
Andrew Jones is managing director for Europe, Middle East and Africa at S&C Electric Europe
