I am on the plane returning from the New Energy Update Conference in Munich and a number of themes are spinning through my head. The conference was divided into Wind, Solar and Energy Storage tracks. During the conference I tried to catch what I thought was most interesting on the three different tracks and here are my reflections.
I am on the plane returning from the New Energy Update O&M Conference in Munich and a number of themes are spinning through my head. The conference was divided into Wind, Solar and Energy Storage tracks. During the conference I tried to catch what I thought was most interesting on the three different tracks and here are my reflections:
Wind – the buzzword machine
There is a strong trend for digitalization in wind power. The idea is that utilization of data to create insight that drives action to improve bottom line is solid and one that we at Greenbyte believe strongly in.
Listening to talks and speaking with many people I did get the sense that there must have been something in the water in Munich or that the event organizers were serving coffee infused with AI, Machine Learning, Big Data, Algorithms, Neural Networks, Database, API, False Positives and just about any other word or three letter acronyms relating to data or data science.
Key take away #1: People are talking about things that relate to our business and technologies we very much believe are game changers, that is great.
Key take away # 2: A lot of people who have a superficial knowledge about these technologies could potentially undermine their power.
Solar – the CMMS conundrum
The world of solar is highly fragmented and for the most part faced with slim margins. There are pockets with amazing PPAs, but they are becoming rare. A question many owners and operators are grappling with is how to create O&M models that are cost efficient and guarantee high availability and performance.
While consolidating data into one central platform, like Bright, is high on the agenda for many owners and operators another very real challenge is how to set up the systems that support work order management linked to spare parts inventory and procurement. The challenge is not so much the systems themselves, but how to do it in a world where sub-suppliers with their own internal systems are heavily relied on with contractual arrangements that tend to be relatively short compared to, for example, the wind industry. How much money should be spent on integrating systems with sub-suppliers and how much should be kept in-house? Is it possible to get sub-suppliers to input data into the owner’s system? Etc.
We intend to play a part in this world and think the companies that establish world-class O&M strategies with a large amount of software and data enablement will have a significant competitive advantage. This may lead to portfolios becoming larger and larger.
O&M just got sexy.
Energy storage – the simple idea & the complicated reality
Renewable energy is volatile. Let’s store electricity when prices are low and then sell electricity when prices are high. The idea is so simple. Over the last few days I have learned that the reality is more complicated.
My impression is that, at this stage in the industry, complexity is driven mostly by regulation. Every market has its own special challenges that drive regulation. According to a recently released Accenture report the most common drivers for energy storage are:
- Grid frequency regulation
- Forecast accuracy improvement
- Power quality
- Peak shaving
- Quick start
- Energy arbitrage
- Backup capacity
These drivers are being shaped into regulation that should ideally drive investment and technology development.
It was surprising to me that nearly all the talk about energy storage at the conference was about regulation; very little was about technology and how technology can address the drivers above. Maybe it’s a good thing, maybe investors see technology as a non-issue and believe that the technology is already well proven and ready for deployment. After all, Mr. Musk built a 100 MW battery in less than 100 days.
Being a regulator in this market may be the most difficult (and most important) job in the world right now.