The push towards a more sustainable future is of global importance, and the energy sector is a key player in this task. To achieve this goal, we need to fundamentally shift the way we produce and consume energy. Harnessing the power of artificial intelligence (AI) is one way to achieve this, and this point has been consistently reiterated to me during my career investing in small and medium-sized enterprises and emerging technology companies that look to harness AI.
As I noted in my recent blog post on artificial intelligence and education, AI is changing every industry and will impact society in ways we are only beginning to understand. Many people view AI as the beginning of the fourth industrial revolution, and I wholeheartedly agree. Considering this, I would like to observe the energy sector and examine how the application of AI is transforming energy production and distribution, and the positive consequences it is enabling to ensure we adopt a more sustainable energy system – something we can all agree is necessary.
Our current reliance on fossil fuels is no secret. In particular, Europe’s dependence on fossil fuels recently became evident, as it was exposed to the biggest global fossil fuel price shock since the 1970s. If we continue down this path, it is estimated that all reserves will be depleted by 2060. Therefore, the introduction of AI and its ability to deliver energy optimisation and drive sustainable energy must be seen as a key tool and enabler. By using AI algorithms and machine learning, we can reduce energy waste and improve efficiency. This technology is already being deployed by a host of energy giants, yet there is still a long way to go to ensure we catch up to the pace.
From a consumer perspective, AI has the ability to analyse your home in real time, monitoring your energy consumption patterns. This allows it to adjust heating, cooling, and lighting systems, which can lead to potentially significant reductions in energy use. Similarly, but on a much larger scale, AI can now optimise the operation of power plants, whether they are operating on fossil fuels or sustainable sources, predicting energy demand, and adjusting outputs. Imagine the energy consumption savings that can be made with fossil fuels and the knock-on effect this can have on emissions targets.
Another critical aspect where AI can and must drive sustainable energy sources is by predicting energy demand and supply. Accurately predicting energy demand and supply is vital for efficient energy production and distribution. By using historical data and real-time information, such as weather forecasts and energy market trends, we can predict and plan accordingly. This information can then be used to adjust energy production and distribution systems to ensure that energy is available when and where it is needed.
Most importantly, in my opinion, AI can play its most crucial role now in integrating renewable energy sources into the grid. In the UK, for example, renewables now account for more than 43% of the total electricity generated, and this figure is positively growing worldwide – but still has a long way to go. However, sources such as solar and wind power are intermittent, making it challenging to manage energy output. Where AI can step in and help is by managing this variability, predicting energy output from renewable sources, and adjusting energy production and distribution, ensuring more efficient and reliable integration.
Ultimately, the application of AI in the energy sector has the potential to drive sustainable energy sources. By optimising energy systems, predicting energy demand and supply, integrating renewable energy sources into the grid, and reducing the environmental impact of energy production, we can create a more sustainable and secure energy system. As we continue to face the challenge of climate change, as well as the short-term threat of energy security, it is crucial to leverage the power of AI to achieve these goals.