Digitalisation

Making energy systems smarter, more connected, efficient and resilient

Rapid advances in data, analytics, artificial intelligence and connectivity are opening up a range of new digital applications that can create more efficient, cleaner, resilient and sustainable energy systems.

Introduction

Smart grids can collect and coordinate data from generators, system operators, end users and electricity market stakeholders to operate power systems more efficiently, minimising costs and environmental impacts while maximising reliability, resilience and stability. Digitalised energy systems in the future may be able to identify who needs energy when and deliver it at the right time, in the right place and at the lowest cost, such as choosing to recharge electric vehicles either when demand elsewhere is low, or when renewables are operating at surplus output.

So-called `smart cities’ can leverage traffic, air quality and weather data collected from everything from appliances to street lamps, relying on artificial intelligence to make real-time decisions about public transport and energy consumption, making our roads more fluid, our electricity grids more stable and our street lighting more effective.

But digitalisation also raises new security and privacy risks. Integrating diffused and decentralized renewables generation creates new entry points for cyberattacks.

Policy makers, business executives and other stakeholders increasingly face new and complex decisions. Adding to this challenge is the extremely dynamic nature of energy systems, which are intermingling the latest technologies with large legacy physical infrastructure and assets.

Global renewable energy power purchase agreements by sector, 2010-2021

Open

Data centres and data transmission networks are responsible for nearly 1% of energy-related GHG emissions

Since 2010, the number of internet users worldwide has more than doubled, while global internet traffic has expanded 20-fold. Rapid improvements in energy efficiency have, however, helped moderate growth in energy demand from data centres and data transmission networks, which each account for 1-1.5% of global electricity use. Significant additional government and industry efforts on energy efficiency, RD&D, and decarbonising electricity supply and supply chains are necessary to curb energy demand and reduce emissions rapidly over the coming decade to align with the Net Zero by 2050 Scenario.

ICT companies invest considerable sums in renewable energy projects to protect themselves from power price volatility, reduce their environmental impact and improve their brand reputation. In fact, Amazon, Microsoft, Meta and Google are the four largest purchasers of corporate renewable energy PPAs, having contracted over 38 GW to date (including 15 GW in 2021).

Data Centres and Data Transmission Networks: Tracking Progress 2022

Our work

The IEA is expanding cross-Agency efforts to assess the policy, regulatory, technology and investment context needed to accelerate progress on power system modernisation and effective utilisation of demand side resources, leveraging the opportunities offered by digitalisation. The project draws from global experience and lessons learned to address emerging economies challenges and provide actionable recommendations.

Learn more about the Digital Demand-Driven Electricity Networks Initiative

The IEA is exploring the potential impacts of digitalisation on energy efficiency and implications for policy makers. We are looking at how digital technologies enable greater control, optimisation and analytics, and how this in turn enables greater end-use and systems efficiency, especially when combined with the right policy frameworks and innovative business models.

Energy efficiency and digitalisation

The aims of the 4E TCP are to promote energy efficiency as the key to ensuring safe, reliable, affordable and sustainable energy systems. As an international platform for collaboration between governments, the 4E TCP provides policy guidance to its members and other governments concerning energy using equipment and systems. The 4E TCP prioritises technologies and applications with significant energy consumption and energy saving potential within the residential, commercial and industrial sectors (not including transport). To meet its aims, the 4E TCP harnesses the expertise of governments, industry, experts and other TCPs for joint research related to the development and deployment of energy efficient equipment.

The Users TCP’s mission is to provide evidence from socio-technical research on the design, social acceptance and usability of clean energy technologies to inform policy making for clean, efficient and secure energy transitions. Decarbonisation, decentralisation and digitalisation are embedding energy technologies in the heart of our communities. Communities’ response to these changes and use of energy technologies will determine the success of our energy systems. Poorly designed energy policies, and technologies that do not satisfy users’ needs, lead to ‘performance gaps’ that are both energy and economically inefficient. User-centred energy systems are therefore critical for delivering socially and politically acceptable energy transitions.