The Future of Energy: Innovations Shaping a Cleaner World
Since the Russian invasion of Ukraine, European energy markets have been roiled, pushing gas and oil prices to their highest levels in nearly a decade and forcing many countries to reconsider their main sources of energy. A situation that is aggravated with every passing day.
As the largest supplier of gas and oil in Europe, Russia uses its resources as a tool to blackmail European countries that condemn the invasion, as the Guardian notes. At the end of April, the Kremlin refused to fulfil a contractual obligation and halted gas supplies to Poland and Bulgaria.
The recommissioning of coal mines and sourcing energy from other countries and continents are now being considered as temporary solutions. Even if the invasion leads to increased carbon dioxide (CO2) emissions in the short term, it may help propel the world towards a cleaner energy future; in response to the aggression, the EU has amplified its efforts to replace Russian gas with sustainable energy.
In March 2022, the European Commission released a plan to reduce Europe's dependence on Russian fossil fuels by 2030, which includes increased support and investment in various clean energy startups.
At MadAppGang, we worked on the Evergen clean energy project. Using advanced software, this project aims to facilitate the transition to a resilient, decentralised renewable energy system.
During the project, we explored the market and faced challenges that gave us a deeper understanding of the evolution of the energy sector. In this article, we want to give an overview of the technologies leading the way to energy's future, and how IT startups can help promote these.
We hope that with this knowledge, you will be able to make informed decisions about the most promising technologies for your business.
The future of energy
Since the beginning of the century, pollution and concerns about greenhouse gases have pushed the world to reject fossil fuels such as oil and coal. Many developed countries worldwide have invested significant effort and capital in the production of renewable energy in the last fifteen years, in part to meet their Paris Agreement obligations.
This was hampered by a strong gas lobby and heated nuclear power debates. The invasion of Ukraine served to highlight the potential dangers of both nuclear energy and heavy gas dependence; today, there's a heightened emphasis on renewable energy and fewer barriers to industry development.
Aсlean energy future is on the horizon with solutions such as household solar panels and electric vehicles already commonplace and advances in hydrogen and biofuel technologies unsettling the gas market. Here are some of the technologies helping to shape this future:
Since the sun provides unlimited renewable energy with little to no CO2 emissions, solar energy projects garner the most attention and investment. Solar energy has been gaining momentum since the mid-2000s, but solar photovoltaic (PV) systems only become cost-competitive after an 85% decline in prices over the past decade.
In 2022, especially due to the current energy crisis, the industry may see significant growth. For instance, experts suggest that we will see new rooftop and floating photovoltaic modules and a growing number of community solar projects.
The wind is a renewable energy source that emits no harmful toxic elements, accordingly, it’s one of the most popular renewable energy sources. With a global capacity of 743 gigawatts (GW), wind power produced more than 6% of global electricity in 2020.
Still, wind infrastructure requires a lot of space and produces a lot of noise, especially when compared to solar, meaning wind farms are impractical near cities. Fortunately, innovative companies are working to solve these problems.
In addition to clean power generation, investments in wind power offer many benefits such as the creation of new jobs, significant capital infusion in regional value chains, and the public health benefit of reduced CO2 emissions. Investment in the wind sector offers a pathway to a robust and sustainable recovery for developing economies facing the dual challenge of restarting economic growth while maintaining energy security.
Global geothermal energy production sat at 16.40 GW in 2021, which is lower than wind energy. Still, it remains one of the most promising renewable energy sources, particularly in adapted regions like Iceland or New Zealand.
Geothermal heat is heat trapped beneath the earth's crust as a result of its formation and radioactive decay 4.5 billion years ago. It’s possible to harness this heat and produce geothermal energy by converting the heated underground water into steam, which rises and can then be used to power a turbine.
Hydrogen, the most abundant element in the world, could not only shape the future of energy but replace natural gas entirely. When separated from another element (water, for example), hydrogen can be used as a fuel and a power source.
Currently, the industrial and building sectors are the main consumers of hydrogen. However, other sectors like transportation offer considerable hydrogen use opportunities. This is why, for example, the European Commission plans to install 40 GW of renewable hydrogen electrolysis capacity in the EU by 2030. Experts at Goldman Sachs, however, predict that Europe's high gas prices will lead to faster adoption of hydrogen energy than previously thought. It won't be long before hydrogen generation becomes a US$1 trillion industry.
Types of hydrogen energy. Source: Weforum
The gas produced by the decomposition of organic matter can generate a good amount of energy. This energy is not considered green per se as biofuels release CO2 emissions but at the same time, it's a renewable source of energy and, therefore, promising.
For instance, Goldman Sachs invested much time and US$343 million into biomass plants in Japan. It’s anticipated that biomass energy will continue to see a rise in demand during the transition to net-zero. This sector is expected to reach US$92 billion globally by 2026.
Compared to fossil fuels, nuclear power plants produce large quantities of energy without direct CO2 emissions. Just half a year ago, nuclear power was a key part of the world's plan for a sustainable energy future. Nuclear power, despite heated discussions and challenges, such as the storage of nuclear waste, seemed like one of the most promising in the energy industry. As an example, the US budgeted US$1.8 billion for nuclear energy in 2022, a 50% increase from the previous year.
Nuclear power plants in the US. Source: NaturalGasIntel
Since the Russian invasion of Ukraine, things have changed drastically in Europe due to increased security concerns. In March 2022, Russian troops seized Europe's largest nuclear power plant in the southeast of Ukraine. This first-ever shelling of nuclear reactors gave humanity a well-justified fear of radiation spills. At the same time, nations realise that renewables such as wind and solar cannot meet their climate goals alone. Thus, investments in the sector are likely to continue.
Energy storage systems
Battery energy storage systems (BESS) collect energy from a variety of sources, accumulate it, and store it in rechargeable batteries. BESSs come in different sizes and are used everywhere (from smartphones and electric vehicles to large industrial systems). Moreover, BESSs are a key part of the entire transition to green energy as they're an affordable, flexible grid-balancing tool.
In 2021, the global energy storage system market was valued at US$211 billion, with abundant investments expected in the sector, it’s expected to be worth US$435 billion by 2030. BESSs require sophisticated software, so this big energy niche presents a lot of interest to IT entrepreneurs, too.
How can IT innovations help shape the future of energy?
In order to manage batteries efficiently, modern BESSs require advanced software for monitoring and measuring battery cells, protecting batteries from hazards, forecasting consumption, and so on. The demand for this software is growing alongside the BESS market, which isn't yet saturated. Furthermore, some energy management projects still rely on traditional accounting systems or monolithic applications, which are often characterised by inefficiency, expense, long delays and workarounds.
Cloud-native technology is the only solution that can meet the needs of the modern energy sector and BESS management. By building cloud-native software, you can create digital products that are secure, easy to scale, and offer endless opportunities for integrating the latest innovations such as artificial intelligence (AI).
AI, in turn, has the potential to improve management on three levels: through analytics built into the platform, via integrated weather and consumption forecasts, and from supplemental analytics software such as energy demand management, arbitrage, and predictive maintenance.
A good example of modern AI-powered cloud-native software for energy systems is Evergen, one of MadAppGang's projects. For Evergen, our team developed a platform for optimal use of solar energy resources — smart power trading and distribution, peak demand avoidance, demand response services, grid stabilisation management, trading functions, asset dispatching and financial transactions.
The Evergen app, with its automated features and capabilities, is helpful to solar storage operators and individual users who want to get the most out of their solar panels.
An example of AI-powered software for BESSs. Source: Evergen
Low-code solutions, modern developer tools and frameworks, and cloud-native development practices helped us deliver the app to market in less than seven months. In addition, the app, a cloud-native solution, helped the company enhance its workflow and customer service and scale from 400 to 5,000 clients within several months.
If a similar smart solution is what you need for your startup or existing energy company, you can rely on MadAppGang. Our team has the experience and skills to build AI-powered cloud-native software. We can handle any project, no matter how complex. Send us a note and let's work together to make your idea a reality.