Digitalization and energy efficiency

The coronavirus pandemic put many investment plans on hold, but it also pushed many national and local governments, as well as lots of companies, to think about how to build a better future and make a more intelligent use of natural resources.

Innovation and smart technology are paramount in the global commitment for sustainable living in energy-efficient cities. A report by the International Energy Agency (IEA) pointed out how far digitalization can change energy production and consumption around the world. While the impact on the supply side is relevant, it can be even more important on the demand side, as the spread of digital devices enables large potential improvements in energy efficiency in buildings, cities, industries and transports.

Any energy efficient decision should start from accurate data collection and analysis. In this perspective, digitalization means designing and implementing technologies that can gather, manage and correlate data to make changes to the physical environment and decrease the overall energy consumption, or use available energy in a more responsible way.

That was exactly the idea of the enCOMPASS project, funded by the EU Commission under the Horizon 2020 program and bringing together 14 partners, including Paradox Engineering, under the supervision of Politecnico di Milano. By developing a technology platform with smart energy or gas meters, a network of smart home sensors, and some friendly digital tools as a mobile app, we provided users the opportunity to monitor power consumption at home, at school or in the office, taking advantage of customized suggestions to save energy while retaining personal comfort levels. The project proved that smart technologies can ignite change and save up to 14.8% power in energy-intensive households and over 20% in primary schools.

The combination of smart data gathering platforms, advanced data processing (for instance leveraging artificial intelligence algorithms), and user-friendly tools can suggest to commuters the most energy efficient route to work according to real-time traffic conditions, switch a building’s cooling system or robots in a production line, automatically dim streetlights upon environmental conditions or vehicle transit.

Digital technologies are already widely used in a number of energy end-use sectors, increasing efficiency as traditionally defined, thus reducing the energy used per unit of activity. However, IEA highlights the real plus of digitalization is the opportunity to both increase end-use efficiency and the efficiency of the entire energy system.

As a more decentralized system is getting a foothold in many countries around the world, flexibility is increasingly important to ensure energy production runs as efficiently as possible, with power supplied when it is needed, and consumed when it is available. Specifically, considering the rising use of renewables and community self-generation, smart digital technologies can ultimately benefit the overall system through avoided investments in additional energy infrastructure, improved integration of renewables, and enhanced energy security, amongst other impacts.

By enhancing both end-use and system efficiency, IEA suggests digitalization forces us to re-examine perceptions that energy efficiency and demand response are separate, or in conflict: smart technologies enable a holistic, future-oriented approach, moving toward increased sustainability and a decisive push to curb greenhouse gas emissions.

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