As vice president of Innovation at National Grid Partners, I’m responsible for developing initiatives that benefit National Grid’s current business and have the potential to become stand-alone businesses. So I have strong views about the future of the energy industry.
But I don’t have a crystal ball; no one does. To be a good steward of our innovation portfolio, my job isn’t to guess the correct “basket” for our “eggs.” It’s to optimally allocate our finite eggs across multiple baskets with the most significant collective upside.
Put another way, global and regional trends make it clear that the Next Big Thing isn’t any single thing at all. Instead, the future is about open innovation and integrating elements across the energy supply chain. Only with such an open energy ecosystem can we adapt to the highly volatile — some might even say unpredictable — market conditions we face in the energy industry.
Just as the digital internet rewards innovation wherever it serves the market — whether you build a better app or design a cooler smartphone — so will the internet offer greater opportunities across the energy supply chain.
I like to think of this open, innovation-enabling approach as the “energy internet,” I believe it represents the most significant opportunity in the energy sector today.
The internet analogy
Here’s why I find the concept of the energy internet helpful. Before the digital internet (a term I’m using here to encompass all the hardware, software, and standards that comprise it), we had multiple silos of technology, such as mainframes, PCs, databases, desktop applications, and private networks.
As the digital internet evolved, however, the walls between these silos disappeared. You can now utilize any platform on the back end of your digital services, including mainframes, commodity server hardware, and virtual machines in the cloud.
You can transport digital payloads across networks that connect to any customer, supplier, or partner on the planet with whatever combination of speed, security, capacity, and cost you deem most appropriate. That payload can be data, sound, or video, and your endpoint can be a desktop browser, smartphone, IoT sensor, security camera, or retail kiosk.
This mix-and-match internet created an open digital supply chain that has driven an epochal boom in online innovation. Entrepreneurs and inventors can focus on specific value propositions anywhere across that supply chain rather than having to reinvent the supply chain itself continually.
The energy sector must move in the same direction. We need to be able to treat our various generation modalities like server platforms. We need our transmission grids to be as accessible as our data networks, and we need to be able to deliver energy to any consumption endpoint just as flexibly. We need to encourage innovation at those endpoints, too — just as the tech sector did. Just as the digital internet rewards innovation wherever it serves the market — whether you build a better app or design a more great smartphone — the energy internet will also offer more excellent opportunities across the energy supply chain.
