Coming off a year when the shale boom made the United States a leading producer of oil and natural gas, coupled with volatile crude oil prices and shifts in climate change policy, business leaders might have trouble predicting where the energy industry is headed in 2018.
For companies of all sizes, the focus should be on the developments that will affect the sources of power they will need to run their businesses. As the world tackles the challenge of reducing carbon emissions, the adoption of new technologies will be accelerated to meet global energy needs in more environmentally sustainable ways.
Because about 25 percent of global greenhouse gas emissions come from electricity and heat production, the push is on to adopt renewable-energy alternatives to fossil fuels – particularly an abandonment of coal, the burning of which produces more pollutants than any other energy source.
Is “going green” on energy a viable option for all nations? Global demand for energy continues to grow, propelled not only by a strong U.S. economy but also by the rising aspirations of the emerging-market nations. For decades to come, that demand cannot be met solely by wind, solar and other alternative energy sources.
“Because about 25 percent of global greenhouse gas emissions come from electricity and heat production, the push is on to adopt renewable-energy alternatives to fossil fuels – particularly an abandonment of coal, the burning of which produces more pollutants than any other energy source.”
It’s true that the costs of wind turbines and solar panels continue to decrease. However, utility-scale installations of solar fields and wind farms that could replace some conventional power plants take considerable time and money to build. Even if there were enough wind and solar capacity, the need exists for conventional power generation to maintain a steady, adequate flow of power that is dispatchable at the immediate time of demand.
In light of these realities, the challenge for public utilities and other power producers is to make cleaner, more efficient use of conventional fuels. Natural gas is already a relatively low-carbon fuel and, thanks to advances in turbine technologies, is becoming cleaner and more efficient than ever. As more of the world’s coal-fired plants switch to natural gas as a fuel source, carbon emissions from electricity generation are falling even as the production of power increases to meet global demand.
Energy efficiency also depends on the smart allocation, integration and distribution of electricity across the grid. Demand requires grid operators to nimbly juggle alternative and conventional power sources and apply digital technologies to manage real-time allocation of energy to ensure steady, reliable power.
Fortunately, the increasing digitalization of power production and consumption means that software systems and networks can remotely monitor and troubleshoot power plants helping them run at peak efficiency with predictive analysis that enables timely preventive maintenance.
Despite the confusing and contradictory energy headlines of 2017, business executives should focus their attention on these longer-term trends that will become more evident in 2018 and the years that follow. The will and the technologies are in place to help the world meet its growing energy needs now and in the decades to come in an environmentally responsible way.